‘Crypto Friendly’ Bank Silvergate to Wind Down Operations – Decrypt

Blaming "recent industry and regulatory developments," cryptocurrency-friendly bank Silvergate announced today that it is shutting down operations.

according to a wednesday Press release For Silvergate Capital Corporation, the holding company of Silvergate Bank, an orderly winding down of the Bank's operations and a voluntary winding up of the Bank is the best way forward.

“The Bank's winddown and liquidation plan includes the full refund of all deposits,” the press release said. "The Company is also considering how best to resolve the claims and preserve the residual value of its assets, including its proprietary technology and tax assets."

In the announcement, Silvergate Capital said it is voluntarily liquidating the Bank "in an orderly manner and in accordance with applicable regulatory processes."

Silvergate previously announced that it will also discontinue the Silvergate Exchange Network (SEN).

Beyond the prolonged cryptocurrency bear market, Silvergate has recently attracted scrutiny from US regulators, with the White House confirming it was bank condition monitoring. US Senator Elizabeth Warren accused “Crypto-friendly” banks like Silvergate to open the banking system to the increased risk of “crypto crash,” which she says will leave US taxpayers with the bag.

“It is the job of banking regulators to insulate the banking system and taxpayers from the risk of crypto fraud,” Warren said in a recorded speech in January. “They have the tools and they need to use them.”

Warren's comments were the preface to a virtual panel discussion titled "Meeting the Crypto Challenge: Learning from a Crash."

Per today's announcement, all other deposit related services remain operational while the company works through the liquidation process.

"Customers will be notified in case there are any further changes," the company said.

The news comes a week after Coinbase, the largest US-based cryptocurrency exchange, said it is hesitant payments with Silvergate Bank.

Silvergate did not immediately respond to a request for comment from decipher.