Why Block, Coinbase, and Silvergate Capital Sank Today
Shares of crypto-focused stocks Block (NYSE: SQ), Coinbase (NASDAQ: COIN), and Silvergate Capital (NYSE: SI) were down big again on Tuesday, with the stocks down 8.7%, 8.6%, and 10.9%, respectively, as of 1:30 p.m. ET.
Although these three stocks are not cryptocurrencies in and of themselves, each is related to the health of the cryptocurrency market in some way. Yet with the current stock market sell-off, investors are fleeing newer and flashier kinds of assets like cryptocurrencies for more safe-haven stocks and assets. It also didn't help that the European Central Bank issued a warning over cryptocurrencies today on top of a down day for the markets.
Today, the European Central Bank (ECB) issued its biannual financial stability report, which included the warning that "Systemic risk increases in line with the level of interconnectedness between crypto-assets and the traditional financial sector." It doesn't appear that the ECB is warning about a current financial crisis due to crypto; rather, it seems to be saying that if cryptocurrencies continue on their growth path and become more interconnected with the financial system, significant risks could appear.
Source Fool.com
