The crypto-friendly bank Silvergate says it has decided to stop doing business and go out of business. This makes it the latest company to fail after FTX.
The news caused the bank’s stock to drop by 36% after business hours. At the time of publication, Bitcoin (BTC) went from $22,100 to $21,777.
The bank is based in California and has assets worth about $11 billion. It says it will pay back all deposits in an orderly way.
Silvergate is also shutting down its SEN platform, which let institutions quickly trade crypto for cash 24 hours a day without having to use slow and complicated bank wires.
Silvergate says that closing down is the best thing to do because of “recent changes in the industry and in regulations.”
Many people in the industry will probably turn to Signature Bank in New York, which is another important banking partner in the industry.
After the collapse of the offshore crypto exchange FTX in the Bahamas, Silvergate is the next domino to fall. FTX stole and gambled with customer deposits by giving them to its hedge fund, Alameda Research.
One of the biggest financial scams in history is thought to have been run by FTX founder Sam Bankman-Fried.
Bankman-Fried was brought quickly from the Bahamas to the US and then given a $250 million bond to get out of jail.
He has pled not guilty and faces up to 115 years in prison for conspiracy to conduct wire fraud on consumers, customers, lenders, commodities, securities, money laundering, and U.S. campaign financing laws.
