Silvergate Capital Corp has stated it would cease crypto payments on its exchange network, Reuters revealed on Friday. The news comes just two days after reports surfaced over its financial standing.
It said in a statement: “Effective immediately Silvergate Bank has made a risk-based decision to discontinue the Silvergate Exchange Network (SEN). All other deposit-related services remain operational.”
The developments triggered a two percent decline in the company’s shares, which closed at 0.9 percent, or 5.77 percent and a 97 percent decline from November 2021.
The news as Silvergate allowed investors and cryptocurrency platforms to perform rapid transfers compared to bank transfers.
It said in a filing it would reassess its operations amid the concerns. The company explained that it had sold further debut securities and would become “less than well capitalized.”
Cryptocurrency firms such as Galaxy Digital, Coinbase Global, Gemini, and Bitstamp, among others, have also cut their banking partnerships with the embattled bank.
Many of Silvergate’s troubles began after reported ties to now-defunct cryptocurrency platform FTX. Silvergate allegedly facilitated illegal banking transactions for FTX and Alameda Research transactions just days before the latter cryptocurrency exchange filed for Chapter 11 bankruptcy.
