The company promises to require full recovery of all customer deposits.
The company’s stock had fallen more than 30% quickly after the news as traders reacted to it, and it finished in the red on Wednesday. Shares of the ailing cryptocurrency-friendly financial institution were 48.8% lower before the markets opened on Thursday at 7:50 am ET.
Because the revelation exacerbated the negative market sentiment, cryptocurrency prices also plummeted.
Silver gate said late on Wednesday that it might be closing the Silver gate Bank and selling off its assets in a news release.
“In light of recent business and regulatory events, Silver gate feels that a voluntary liquidation of the financial institution is one of the best paths forward. This would be an orderly wind-down of the financial institution’s operations. In accordance with the financial institution’s wind-down and liquidation strategy, all deposits will be fully refunded. The Company may be thinking about the best way to handle claims and safeguard the remaining value of its assets, such as its specialized knowledge and tax property, according to the report.
The company previously this year disclosed a $1 billion loss and a significant drop in customer numbers. With intensifying financial difficulties, the crypto financial institution has recently come to the attention of US regulators.
Due to Silver gate’s withdrawal from the cryptocurrency market, Signature Financial Institution, a New York-based banking provider with more than $114 billion in assets, is now the only financial institution that supports cryptocurrencies.