- Silvergate Capital has announced that it will discontinue the Silvergate Exchange Network.
- The news led to the crypto bank’s share price tanking over 2% in after-hours trading.
Silvergate Capital Corp has announced that it will suspend the Silvergate Exchange Network (SEN), its crypto payments network.
The move to discontinue the network comes just two days after the crypto-focused bank raised doubts about the viability of the network. The decision to suspend SEN was reportedly made after assessing the risks associated with the network.
Silvergate was down 2% in after-hours trading
According to a report by Reuters, the Silvergate Exchange Network was one of the bank’s most popular offerings, enabling round-the-clock transfers between investors and crypto exchanges.
This was a major advantage over traditional bank wires, which sometimes take days to settle. This service counted industry heavyweights like Binance U.S and Kraken among its customers.
A statement posted on Silvergate’s official website read, “Effective immediately Silvergate Bank has made a risk-based decision to discontinue the Silvergate Exchange Network (SEN). All other deposit-related services remain operational.”
Companies operating in the crypto space received similar statements from a spokesperson for the crypto bank. “Unfortunately, we have no additional information to share at this time,” the spokesperson added.
The share price of Silvergate Capital (SI) tumbled following the news of SEN’s suspension.
Data from MarketWatch showed that the stock tanked more than 2% in after-hours trading after closing at $5.77 following a modest hike of 0.87% over the previous trading day.
The past week has been nothing short of brutal for the stock, which slumped more than 66%, thanks to a string of controversies that cost the crypto bank its partnerships.
Earlier this week, Silvergate disclosed in a filing that it had offloaded additional debt securities at a loss since the beginning of 2023.
The crypto bank added that further losses may lead to it being “less than well capitalized,” and that its ability to operate properly may be affected. This was followed by Coinbase and Galaxy Digital ending their partnerships with the bank.
