What Does The Largest US Crypto Bank’s Collapse Mean for Crypto?
Silvergate Capital is shutting down. The bank for crypto companies is returning deposits to customers and ceasing operations.
Here’s Margot Robbie breaking down what happened:
In January, Silvergate was forced to sell assets to cover customer withdrawals — totaling over $8B.
Goes to show — nothing is truly safe in crypto. Not even the largest US bank of its kind with a $5B market cap at its peak and customers that once spanned nearly all major US crypto exchanges.
How’s the crypto market reacting? Bitcoin ($BTC) and Ethereum ($ETH) are both down nearly 13% since Silvergate warned of a potential “going concern” last week.
Silvergate’s collapse is having ripple effects on the industry. Thousands of crypto startups are now desperate for banking services. Smaller companies without established banking relationships will find it even harder.
Regulators will continue to attack crypto. Silvergate’s downfall gives regulators fresh ammunition to go after the industry.