Silvergate's deepening crisis jolts crypto stocks

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Shares of Silvergate Capital Corp fell 10% in early trading on Monday after the bank suspended its crypto payments network and expressed doubts over the viability of its business.

"The crypto market reacted to the negative news from Silvergate Bank, with both bitcoin and ethereum down about 4.8% for the week," analysts at brokerage Bernstein said.

Shares of Silvergate hit a record low of $4.86 on Friday, shedding nearly 98% of their value since an all-time high close in November 2021 and wiping out more than $7 billion from the company's market capitalization."We believe a receivership/liquidation scenario is a distinct possibility and arrive at a liquidation value of $5 per share," Wedbush analysts said. The estimated price marks a roughly 13% downside to the stock's previous close.Silvergate as their banking partner.

The firm has been struggling to stay afloat after the collapse of Sam Bankman-Fried's crypto exchange FTX in November drove investors to pull out $8 billion in deposits from the bank in the last three months of the year.Reporting by Manya Saini in Bengaluru; Editing by Anil D'Silva and Devika Syamnath

 

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Crypto stocks fall as Silvergate crisis deepensShares of cryptocurrency-related companies fell in premarket trading on Monday after Silvergate Capital Corp pulled the plug on its crypto payments network, following its doubts about keeping its business viable. Gotta diversity that portfolio with some NFTs bro.
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