Silvergate bank is no longer associated with Coinbase
Due to some delay in filing reports, the crypto exchange Coinbase decided to end its ongoing partnership with Silvergate bank. Thus, the exchange will neither accept nor initiate any payments with the bank.
Coinbase no longer associates itself with Silvergate banking which was its US dollar payment facilitator. They’ve also decided for the SIgnature bank, to enable cash transactions for institutional clients who are prime customers. It is also another banking partner of Coinbase.
In one of their tweets, the cryptocurrency exchange stated :
“In light of recent developments & out of an abundance of caution, Coinbase is no longer accepting or initiating payments to or from Silvergate.“
US-SEC a finance regulatory body requires a document called a 10-K report. While the bank demanded additional 2 weeks to complete it for the fiscal year 2022. Coinbase decided to part ways with SIlvergate banks after it delayed its annual 10-k report.
Not only that the stock value of Silvergate bank has also decreased ever since, and recently it dropped 40% more in pre-marketing. JP Morgan downgraded the Silvergate capital from ‘neutral’ to ‘underweight’ due to the bankruptcy scare. However, this does not impact the bank’s payment instructions in euros or pounds.
After the FTX crypto exchange collapsed it dragged down the Fintech bank with it. Silvergate formerly a crypto bank, because of its emerging branches in the crypto world and crypto partnership. With the downfall of the FTX exchange, Silvergate also came under investigation by the US department of justice for its involvement in the incident.
Moreover, the CEO of Silvergate bank Alan Lane was also accused of facilitating the multi-billion fraud by Sam Bankman-Fried. Consequently, due to the ongoing investigations with Silvergate Capital, it shorted around 72% of the stock by the end of January, Now after the termination of its crypto partnerships Silvergate has become one of the most shorted stocks in the currency market.