The now-defunct California bank Silvergate is settling probes brought by federal and state regulators by dishing out $63 million. Silvergate collapsed spectacularly last year after its customers rushed for exits as a result of the collapse of FTX.
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According to the Financial Times, Silvergate’s settlement includes penalties stemming from the charges brought by the SEC, the Federal Reserve, and the California Department of Financial Protection and Innovation.
The Debacle at Silvergate
At one point, Silvergate was the largest cryptocurrency bank in the U.S. However, the collapse of Sam Bankman-Fried led FTX proved to be its undoing. Nearly a billion dollars of Silvergate’s deposits were accounted for by FTX and other companies controlled by Sam Bankman-Fried. In the wake of FTX’s collapse, Silvergate’s deposits plunged by nearly 52% in the final quarter of 2022. The bank had to sell off its debt and assets at a loss to meet the withdrawals. Subsequently, Silvergate shut shop in March 2023.
The SEC alleged that Silvergate failed to adequately monitor and detect suspicious financial transactions. The securities watchdog has also accused Silvergate and three of its executives of deceiving investors about legal compliance and the bank’s financial health in the aftermath of FTX’s collapse.
While both FTX and Silvergate are now pretty much out of the cryptoverse and Sam Bankman-Fried received a 25-year prison sentence, cryptocurrencies are back in full swing. Bitcoin (BTC-USD), the largest cryptocurrency in the world, is up by nearly 108% over the past year.
Is BTC Expected to Go Up?
This bullish action in BTC could continue over the coming days as the TipRanks Technical Analysis tool is flashing a Buy signal for Bitcoin on a monthly timeframe.
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