Crypto Bank Silvergate Capital Says It Will Shut Down; Stock Plummets

Silvergate’s decline tracked the unraveling of the broader crypto industryARIANA DREHSLER/BLOOMBERG NEWS

Silvergate Capital, one of the crypto market’s top banks, is shutting down.

The bank will repay all deposits and “is also considering how best to resolve claims and preserve the residual value of its assets,” it said in a news release Wednesday.

Silvergate caters to companies in the crypto business. It helped institutional investors move dollars in and out of crypto-trading platforms through its Silvergate Exchange Network, which it stopped operating last week.

The bank’s implosion makes it one of the few non-crypto companies to go out of business as a result of the industry’s downturn.

Silvergate’s decline tracked the unraveling of the broader crypto industry. What once was a novel business strategy soured as crypto companies withdrew their deposits, bank regulators cracked down on lenders’ exposure to the sector and investors grew wary of the approach.

Silvergate’s share were down more than 28% in after-hours trading. It closed Wednesday at $4.91, an all-time low in data going back to November 2019, according to Dow Jones Market Data, and off 98% from its all-time high set in November 2021.