BlocksInform
On March 2, 2023, the cryptocurrency COINBASE announced that, based on recent developments, the company is "no longer accepting or initiating payments to or from Silvergate Bank." The news follows the crypto bank’s delay of its annual 10-K filing with the U.S. Securities and Exchange Commission (SEC) and JPMorgan’s downgrade of the company’s shares from “neutral” to “underweight.”
Coinbase reduces links with Silvergate Bank, the company's stocks should be very volatile following recent developments.
Coinbase announced on Thursday that it will no longer accept or initiate payments towards or from the Silvergate crypto-friendly bank. Recently, Silvergate delayed their F'22 deposit of $10,000, citing the need to have more time to finish the deposit. Following the delay, the financial institution JPMorgan downgraded the company’s stock from “neutral” to “underweight.”
Prior to the opening bell on Wall Street Thursday morning, Silvergate’s shares had slid 17.20% in value over the past five days. At 8:23 ET, Coinbase made their announcement. "coincidentally, all customer funds continue to be safe, accessible and available," the company said. "In light of recent developments, Coinbase is no longer accepting or making payments to or from Silvergate as a precautionary measure."
While further noting that funds held at Coinbase are safe, the company added:
Coinbase has de minimis corporate exposure to Silvergate.
The JPMorgan downgrade and Coinbase announcement regarding Silvergate come amid reports that the crypto derivatives platform Ledgerx has informed customers that it is no longer working with Silvergate. The so-called ledgerx email to clients indicates that wire payments will now be made via the signing bank.
While ledgerx has already been part of FTX, it is now one of the subsidiaries that are not involved in the FTX bankruptcy proceedings. Hours before the Coinbase announcement, CNBC reported that Silvergate’s stock was expected to be one of the most active during Thursday’s trading session.
How do you see the recent developments involving Silvergate Bank impacting the cryptocurrency market overall? Reflect on these in the comments section below.
