The Business Intelligence firm Microstrategy and Stablecoin Issuer Tether have become the latest firms to deny any meaningful exposure or interaction with Silvergate bank publicly.
Silvergate is a Fintech company known to provide financial infrastructure solutions and services to the largest cryptocurrency exchanges, mining companies, and institutional investors across the globe. Further, it gives a 24*7 payment platform called Silvergate Exchange Network which has processed around $1 trillion in transactions since 2017. This cryptocurrency bank also provides Stablecoin infrastructure platform digital asset custody management, and Collateralized lending services for the cryptocurrency industry.
Microstrategy also confirmed that none of its 130,000 BTC is custodied with the talked cryptocurrency bank. It also added that Microstrategy only needs to pay back the loan from Silvergate in Q1 2025. Moreover, the bankruptcy or insolvency event will also not accelerate the loan repayment. On the other side, the CTO of Tether also confirmed on March 2, 2023, that Tether is also not exposed to Silvergate either.
This news came after Silvergate announced its plan to postpone the filing of the annual 10-K financial report which puts this cryptocurrency bank on the brink of the bankruptcy filing. Alongside this, the collapse of this cryptocurrency bank would prove costly for the rest of the industry.
Gemini also announced that the company has stopped accepting deposits and processing withdrawals through Silvergate wire transfers and ACH. Besides this Blockchain .com, Crypto.com, Wintermute, Cboe Digital, and GSR have cut or reduced their ties which Silvergate.
The reports about Silvergate’s financial troubles surfaced first in Q4 2022 when the cryptocurrency bank reported a net loss of $1 after the collapse of FTX in November. As a result, the United States Department of Justice has also probed the exact dealings between Silvergate and FTX.
