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March 9 (Reuters) - Shares of crypto-focused companies fell Thursday in pre-market trading after Silvergate Capital Corp. BREAST revealed plans to wind down operations and liquidate voluntarily as the aftermath of the FTX implosion last year reverberates through the industry.
Analysts said the full shutdown of the crypto lender could take one to two years, depending on how quickly outstanding loans are paid off and assets disposed of.
Silvergate's latest move adds to a list of high-profile crashes among crypto market players since last year.
Its share value halved to $2.44, a day after hitting a record low and has lost 64% since March 1 when the company marked a ongoing concern risk.
"We believe this decision was made, at least in part, to help mitigate Silvergate Bank's legal liability related to the FTX bankruptcy," the Wedbush analysts wrote in a note.
Silvergate did not immediately respond to a request for comment on analyst opinion.
Meanwhile, the short sale of Silvergate shares has proved profitable for bear investors, as its shares have lost 95% of their value in the last 12 months and 72% so far this year.
Nearly 85% of the company's free float is in short positions and short sellers have reported $241 million in market-adjusted earnings to date, according to research firm S3 Partners.
Signature Bank Stock SBNY.O, which uses blockchain technology, fell 9%. Coinbase Global cryptocurrency exchange CURRENCY.O, which cut ties with the bank last week, fell 4%. Riot Blockchain Miners RIOT.O and Digital Marathon MARA.O they slid 3.7% each.
BitcoinBTC = BTSP It stabilized at $21,608, near its lowest level since mid-February, and analysts and investors said the news's impact on the market was limited, as widely expected.
Silvergate Stock Performance Since the FTX Crisishttps://tmsnrt.rs/3F5X7b9
(Reporting by Medha Singh and Niket Nishant in Bengaluru; Editing by Sriraj Kalluvila and Arun Koyyur)
((Medha.Singh@thomsonreuters.com; +91 80 6210 0592; Twitter: https://twitter.com/medhasinghs;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
