Silvergate Capital has recently reported that its subsidiary Silvergate Bank lost $1.05 billion in the fourth quarter of last year.
According to the company, the losses are related to a “transformational shift” in the industry with several major bankruptcies.
The press release reads as follows:
“This dynamic has created a crisis of confidence throughout the ecosystem and has resulted in many participants switching to risk-free positions between digital asset trading platforms.”
In this situation, Silvergate Bank faced an outflow of deposits and took a number of actions to maintain liquidity. For example, the company initially resorted to wholesale financing, then to the sale of debt securities.