Silvergate Bank Shuts Down Silvergate Exchange Network (SEN)

The end appears to be near for Silvergate Capital (NYSE: SI). The bank this evening published a notice at the top of its website indicating that it has shut-down its Silvergate Exchange Network, although it currently states that other deposit-related services remain operational.

“Effective immediately Silvergate Bank has made a risk-based decision to discontinue the Silvergate Exchange Network (SEN). All other deposit-related services remain operational,” reads the notice issued by the company.

The Silvergate Exchange Network billed itself as a 24/7 banking service, which enabled digital currency and institutional clients to send US dollars at any time of day, 365 days a year. Funds could be sent via the service to other Silvergate accounts, and the accounts of other Silvergate clients. Prior to the service falling apart in recent days, crypto platforms such as Coinbase, Bitstamp, Paxos, Gemini and others had signed on to the service as a means of providing further legitimacy to the crypto market.

The service however is just another piece of Silvergate that has fallen apart since the firm revealed that it was “less than well-capitalized” earlier this week. Following that announcement, it has seen a mass exodus of major clients as those clients look for stable banking partners.

Separately, it’s been reported on social media that document disposal trucks are currently in front of Silvergate’s offices, while the offices themselves are rather empty. Market commentators as a result have started drawing parallels to the downfall of Enron two decades ago.

Those crypto clients that have left Signature Bank are largely turning to Signature Bank (NASDAQ: SBNY), however that firm is facing troubles of its own – it’s named as a defendant in a new class action complaint against failed crypto exchange FTX, amongst other issues.

Silvergate Capital last traded at $5.77 on the NYSE.

Information for this briefing was found via Edgar and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.