Although Silvergate has confirmed its exposure to BlockFi, it remains measured due to a total of less than $20 million. Despite this, the company is performing poorly on the stock market, with its share price falling nearly 90% in the space of a year.
Silvergate clarifies its position on BlockFi
Institutional digital asset services specialist Silvergate yesterday responded to rumors about its relationship with BlockFi. While the lender has filed for bankruptcy under Chapter 11 of the United States Bankruptcy Act, Silvergate has confirmed its exposure. Nevertheless, it remains very measured, i.e. less than $20 million.
This amount is therefore negligible compared to the money supply that the company manages on behalf of its customers, i.e. $11.9 billion as of September 30. The company had put forward this figure after the bankruptcy of FTX, announcing that it kept “less than 10 %of his assets, which is much more substantial in this case.
Regarding BlockFi, Silvergate wanted to clarify the rumors of which it is the subject, as are many players in the ecosystem at the moment. She warned against false information:
“Recently, Silvergate has been the subject of false and misleading statements. For factual and accurate information, Silvergate refers individuals to its recent press releases, which are available on the company’s website […], in the Investor Relations section and in Silvergate’s most recent quarterly report on Form 10-Q and other filings with the Securities and Exchange Commission. »
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Although this is not an infallible guarantee of transparencyits status as a listed company obliges Silvergate to communicate on its accounts.
Regarding stock market listing, the price of its share on the New York Stock Exchange suffered the full brunt of the fall in the markets that began in November 2021. In one year, Silvergate shares have seen their price melt by nearly 90%which represents a devaluation of its market capitalization of just over $6.7 billion:
Silvergate share price
Silvergate’s action also conceded more than 11% on yesterday’s session after the announcement of its exposure to BlockFi.
Regardless of the current turmoil, Silvergate said its loan products called SEN were in no way affected by the bankruptcies of FTX and BlockFi. Indeed, the funds of this investment vehicle are not kept with these players.
Note also that Silvergate’s SEN product is the one that MicroStrategy used to carry out its collateralized loan in Bitcoin (BTC).
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Sources: Silvergate, TradingView
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I timidly discovered the world of blockchain at the end of 2018 during my quest for financial freedom. Initially invested moderately, it was only two years later that I took the gamble of betting everything on the movement that was taking shape then. I then dedicate 2021 to training myself better to acquire more knowledge and seriousness. As I often like to say: I still have a billion things to learn. And what I do know, I want to share with you.
Vincent Mayor
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