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Silvergate Capital announced on Wednesday the termination and liquidation of Silvergate Bank. The company’s shares fell more than 25% in after-hours trading.
Silvergate is one of the two main crypto banking giants. Another is New York-based Signature Bank, which has more than $114 billion in total assets. Silvergate has just over $11 billion.
“In light of recent industry and regulatory changes, Silvergate believes that an orderly wind-down and voluntary liquidation of the bank is the best way forward,” the company said in a statement.
All deposits will be fully repaid in accordance with the liquidation plan announced on Wednesday afternoon. However, it is unclear how the crypto-friendly bank plans to address the claims against its business.
Centerview Partners will act as financial advisor to Silvergate and Cravath, Swaine & Moore will provide legal services.
The announcement comes a week after Silvergate said it would delay reporting its 2022 full-year earnings until it looked at the “viability” of its business. The company disclosed that the delayed 10-K filing was due in part to an imminent crackdown from regulators, including an investigation already underway by the Department of Justice.
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