Crypto lender Silvergate’s descent into voluntary liquidation

(Reuters) – Crypto-focused bank Silvergate Capital Corp became the latest casualty of a meltdown in the industry after announcing plans to wind down operations and voluntarily liquidate.

Founded in 1988, Silvergate ventured into crypto in 2013. The bank in December said it would shut its mortgage warehouse business amid rising interest rates and declining mortgage volumes.

Date Development

Jan 31, 2022 Meta Platforms Inc-backed Diem Association

sells Blockchain Payments Network and other

intellectual property assets to Silvergate

Oct 18, 2022 The company posted Q3 adj EPS of $1.28, 10

cents below Refinitiv IBES estimate as volumes

on its Silvergate Exchange Network (SEN)

decreased

Nov 11, 2022 The company said it has no outstanding loans or

investments in FTX and as of Sept. 30, 2022 the

crypto exchange represented less than 10% of

total deposits from digital asset customers

after FTX said it would initiate bankruptcy

proceedings in the United States

Nov 28, 2022 The company said it has a minimal exposure to

BlockFi with deposits limited to less than $20

million of its total deposits after the

cryptocurrency lender filed for Chapter 11

bankruptcy protection

Jan 5, 2023 Silvergate cuts 200 jobs and said total

deposits from digital asset customers declined

to $3.8 billion at the end of Dec. 31, 2022,

compared with $11.9 billion at Sept. 30, 2022

Jan 6, 2023 Moody’s Investor Service downgraded

Silvergate’s long-term deposit rating to Ba1

from Baa2

Jan 17, 2023 The company reports a net loss of $1 billion in

the fourth quarter

Jan 27, 2023 Silvergate suspends dividend payouts on some of

its preferred stock to preserve capital

Jan 31, 2023 U.S. senators ask Silvergate for details of its

risk management practices and its dealings with

bankrupt exchange FTX

Feb 2, 2023 U.S. custodian bank State Street Corp reports a

9.32% passive stake in Silvergate Capital as of

Dec. 31

Feb 2, 2023 Federal prosecutors in Washington are also

probing Silvergate and its dealings with

bankrupt crypto exchange FTX and Alameda

Research, according to a source

Feb 14, 2023 Citadel Securities, the market maker owned by

Ken Griffin, reports a 5.5% stake in Silvergate

worth about $25 million, according to a

regulatory filing.

March 1, 2023 Silvergate warned it was delaying its annual

report and said it was evaluating its ability

to operate as a going concern

March 2, 2023 Cryptocurrency heavyweights including Coinbase

Global Inc and Galaxy Digital drop Silvergate

as their banking partner

March 3, 2023 The company said it made a “risk-based

decision” to discontinue payments network

Silvergate Exchange Network

March 6, 2023 A slew of crypto firms issue statements about

material exposure and services with the bank

March 8, 2023 Silvergate plans to wind down operations and

voluntarily liquidate

(Reporting by Mehnaz Yasmin in Bengaluru; Editing by Sriraj Kalluvila)