Silvergate Reveals Positive Financial Data, Shares Rebound

Silvergate, the financial institution oriented to the crypto industry, released data related to its fourth quarter, 2022. Following the collapse of one in every of its partners, crypto exchange FTX, the bank saw over $8 billion in customer withdrawals resulting in rumors about its potential bankruptcy. 

Today, Silvergate has set some minds and hearts comfortable because the bank revealed that it has enough assets and liquidity to proceed its operations. In response to the information, the financial institution has over $11 billion in total assets as of December 31s, 2022, with $6 billion in deposits. 

Silvergate assets and deposits. Source: Silvergate, Q4, 2022 financial report

Hope At The End Of The Tunnel?

Nonetheless, because the image above shows, the financial institution did experience massive losses across the board. Per their financial report, deposits fell by over $8 billion while the corporate recorded a net lack of $948 million

The bank’s flagship product, the Siilvergate Exchange Network (SEN), enables 24/7 transfer between its customers and saw a 4% spike in its dollar transfers in Q4 2022. Despite this increase, the payment solution still recorded a decrease of around $250 million in its year-to-year transaction volume. 

Crypto customers followed the trend, because the collapse of FTX and the bankruptcy of other major crypto firms triggered a widespread “confidence crisis.” By the tip of 2022, the financial institution recorded 1,620 crypto customers in comparison with 1,677 in September 2022. 

Overall, the financial institution could still capture the eye of crypto investors. Despite the persistent downside price motion across digital assets and the “confidence crisis,” the bank saw a rise in crypto investors in comparison with December 2021, when just one,381 “digital asset customers” used the platform. 

Because of this of this financial data, Silvergate’s (SI) shares saw a boom in its pre-market open and market price motion. As of this writing, SI trades at $16, rebounding from a 12 months low of around $10. Still, the corporate is much from its yearly high of $20 and its $240 all-time high.

Silvergate SI SIUSD
SI’s price sees small profits during today’s trading session on the every day chart. Source: SIUSD Tradingview

Silvergate Expects More Issues, The Worst Is Yet To Come?

The financial institution announced additional measures to make sure liquidity and a positive money balance. These measures include letting go of over 40% of its workforce, selling debt, evaluating its product portfolio, and more. 

Alan Lane, CEO of Silvergate, stated the next: 

While we’re taking decisive actions to navigate the present environment, our mission has not modified. We imagine within the digital asset industry, and we remain focused on providing value-added services for our core institutional customers. To that end, we’re committed to maintaining a highly liquid balance sheet with a powerful capital position.

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