Silvergate Capital sells assets, lays off… It fell more than 45% during the day
A US bank specializing in virtual currency is considering selling the company as it faces a won 10 trillion won ‘bank run’ (mass withdrawal of deposits) following FTX, one of the three largest currency exchanges in the world, file for bankruptcy.
Silvergate Capital, a digital asset bank in California, said on the 5th (local time) that it is in the process of restructuring its business in response to calls for raising $8.1 billion (10.3 trillion won).
According to Silvergate’s preliminary fourth-quarter earnings report released last year, the company saw a 68% drop in cryptocurrency-related deposits over the past three months, and lost $718 million to settle a bank run and sell some assets.
He also laid off 200 people, or 40% of the company’s workforce, to cut costs.
Silvergate executives discussed the possibility of selling the company on a conference call, saying the company could become a target for acquisition by a larger financial institution, Bloomberg reported.
The company’s share price plunged more than 45 percent on the New York Stock Exchange that day, sinking into the $11 range.
Silvergate has provided major virtual currency companies such as FTX, Coinbase, and Gemini as customers and provided a service that converts digital assets into dollars and euros and stores them.
The bank seemed to be cruising thanks to the surge in cryptocurrency prices in 2021, but fell into a liquidity crisis last year with a sharp drop in coin prices and the FTX crisis.
/happy news
