Silvergate Capital Shares Plunge 46% Amidst $8 Billion Fall in Crypto Deposits

Silvergate Capital Corp (SI) is facing significant headwinds as its shares plummeted 46% following a reported $8.1 billion outflow of digital-asset deposits during the fourth quarter. This dramatic drop has triggered widespread concern and scrutiny within the crypto market.

According to a limited update to its fourth-quarter earnings, Silvergate said deposits from digital asset customers fell by a staggering $8.1 billion over the three months ended in December. (Reuters) -Silvergate Capital Corp reported a sharp drop in fourth-quarter crypto-related deposits on Thursday as investors spooked by the collapse of FTX pulled out.

The massive withdrawal of funds underscores the ongoing volatility and instability within the cryptocurrency sector, particularly in the wake of the FTX collapse. Investor confidence has been severely shaken, leading to a flight to safety and a contraction in crypto-related banking activity.

In response to these challenges, Silvergate Capital Corp reported a sharp drop in fourth-quarter crypto-related deposits on Thursday and said it would cut its workforce by 40%, or about 200 employees, as it seeks to streamline operations and reduce costs. This restructuring is a clear indication of the pressure the company is under.

The sharp decline in Silvergate Capital's (SI) stock plunged 46% after the crypto bank said it saw an outflow of $8.1 billion in digital-asset deposits during the fourth quarter and has slashed deposits reflects broader concerns about the long-term viability of crypto-focused financial institutions and their exposure to the inherent risks of the digital asset market.

Analysts are closely monitoring the situation, and the future of Silvergate Capital remains uncertain as it navigates these turbulent times. The company's ability to regain investor confidence and adapt to the evolving regulatory landscape will be crucial for its survival.