Silvergate Stock Crashes After Closing Crypto Bank

Businessman checking stock market on digital tablet and a desktop computer with stock exchange graph on screen. Financial stock market. Analyzing data in office background.
ipopba / Getty Images

Shares of Silvergate Capital (SI) crashed more than 37% at Thursday's market open after the California-based crypto bank said it is shutting down operations and starting the liquidation process.

Key Takeaways

  • Shares of Silvergate Capital Corp. crashed after announcing the liquidation of its crypto bank and SEN network.
  • The San Diego bank had failed to file its annual report and faced investigations.
  • Silvergate was unable to recover from an $8 billion run on its deposits.

Regulators have been investigating Silvergate since it failed to submit its annual report on Form 10-K to the Securities and Exchange Commission (SEC) for the fiscal year that ended on Dec. 31, 2022. The company was given an extension until March 16 but has decided to close its business.

"In light of recent industry and regulatory developments, Silvergate believes that an orderly wind-down of bank operations and a voluntary liquidation of the Bank is the best path forward," the company said in a statement. "The bank’s wind-down and liquidation plan includes full repayment of all deposits."

Previously, Silvergate had said it would discontinue the Silvergate Exchange Network (SEN). Industry players had already begun distancing themselves from the bank, with crypto exchange Coinbase stating a day earlier that it was, "no longer accepting or initiating payments to or from Silvergate". 

Silvergate is the latest victim of the contagion that has rocked crypto markets after the collapse of FTX. Alarm bells began ringing for Silvergate investors after the company announced a loss of more than $1 billion and an $8 billion run on deposits.

Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
  1. Silvergate Capital. "Announces Intent to Wind Down Operations".

  2. Silvergate Capital. "Fourth Quarter 2022 Results".

Take the Next Step to Invest
The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace.