March 6 (Reuters) – Shares of cryptocurrency-related companies fell in premarket trading on Monday, following doubts over whether Silvergate Capital Corp ( SI.N ) could keep its business in its crypto payments network viable.
The digital assets-focused bank said late on Friday that it had immediately implemented a “risk-based decision” to shut down Silvergate Exchange Network (SEN).
Shares of the La Jolla, California-based bank fell more than 4% in pre-market trading, while crypto lending peer Signature Bank ( SBNY.O ) fell 3%. Crypto exchange Coinbase Global ( COIN.O ) and BTC mining machine maker Ebang International both fell 1% each.
“The crypto market responded to negative news from Silvergate Bank, with both Bitcoin and Ethereum down ~4.8% for the week,” analysts at brokerage Bernstein said in a trade note.
As several crypto heavyweights, including Coinbase Global and Galaxy Digital, dropped Silvergate as their banking partner, the lender’s recent filing raised questions about its ability to continue.
Latest Updates
See 2 more stories
Shares of Silvergate hit a record low of $4.86 on Friday, shedding nearly 98% of their value since its record close in November 2021 and wiping more than $7 billion from the company’s market capitalization.
The firm has been struggling to stay afloat since the collapse of Sam Bankman-Fried’s crypto exchange FTX in November, prompting investors to pull $8 billion in deposits from the bank in the last three months of the year.
Silvergate reported a net loss of $1 billion in the fourth quarter.
Reporting by Manya Saini in Bangalore; Cinematography by Anil de Silva
Our Standards: Thomson Reuters Trust Principles.
