Rahman Ravelli
Rahman Ravelli Solicitors Logo
Switchboard: +44 (0)203 947 1539

About Us Expertise PEOPLE International Legal Articles News Events Contact Us toggle button for phone toggle button for search

The US bank Silvergate is going into liquidation

Author: Nicola Sharp  21 March 2023

Nicola Sharp, of financial crime specialists Rahman Ravelli, considers the cryptocurrency-related factors that brought about its demise.

The US bank Silvergate is to go into voluntary liquidation after being badly affected by customers withdrawing their funds following the collapse of crypto exchange FTX.

The liquidation of the California-based bank, which had a strong cryptocurrency focus, came after it had warned that it was assessing whether it could continue to operate.

In its announcement, Silvergate said its voluntary liquidation was “the best path forward” in light of “recent industry and regulatory developments”. FTX’s collapse had created volatility in the crypto markets. FTX and its trading arm, Alameda Research, had accounts with Silvergate. Silvergate has also stated that it is being investigated by the US Department of Justice.

Silvergate reported a $1billion (£840 million) loss for the fourth quarter of 2022. This came after investors withdrew more than $8 billion in deposits, forcing Silvergate to suffer losses as it sold assets in an attempt to cover the cost of the withdrawals.

The crypto exchange Coinbase and the crypto financial services company Galaxy Digital had ended their business dealings with Silvergate before the liquidation announcement.

Silvergate was founded in 1988. It became involved with the cryptocurrency sector in 2013. Before the liquidation announcement, it had closed its Silvergate Exchange Network (SEN) crypto payments platform, which enabled transfers between investors and crypto exchanges that were quicker than traditional bank wire payments.

Silvergate had been one of a number of financial institutions that became involved with the rapidly-evolving cryptocurrency industry. It is now one of those that has paid a high price for its involvement in what can be a very volatile sector. Once a number of major crypto companies had decided to end their relationship with Silvergate, liquidation always looked to be an unwelcome possibility.

Nicola Sharp C 09983

Nicola Sharp


+44 (0)203 910 4567 vCard

Download Profile PDF

View Profile

Nicola is known for her fraud, civil recovery, arbitration and business crime expertise, her experience of leading the largest financial disputes and multinational investigations and her skills in devising preventative measures and conducting internal investigations for corporates.

Share this page on