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Author: Admin | 2025-04-28
Open, you can transact with others in seamless method and transfers are instant.” He noted there is also “more liquidity since the crypto markets are active on nights and weekends while the traditional banking system is closed.” Customers have responded to that. Silvergate announced in October that it had done more than $100 billion in transfers since it started the SEN in 2017. Lane said the bank’s customers are primarily institutional investors and other firms doing business in bitcoin and other cryptocurrencies. Customers can’t, as individuals, set up an account at the bank for their bitcoin or other digital assets. Silvergate’s clients include Coinbase, the bitcoin wallet firm that is planning to go public later this year, and Square (SQ), the Jack Dorsey-led payments giant that allows customers to buy and sell bitcoin. The company has also expanded its lending business to take advantage as more financial firms are looking to invest in bitcoin. The bank launched a product called SEN Leverage last year, which gives investment firms bitcoin-collateralized loans. “Think of it like a margin loan: Customers deposit bitcoins and we then lend them dollars, which many of those clients use to buy more bitcoin,” Lane said. This all makes Silvergate’s stock kind of a proxy for bitcoin. Shares tend to go up when bitcoin does and fall when the crypto’s price dips. That’s been good for the stock lately but it’s clear that Silvergate is much riskier than your average bank stock. Shares of Silvergate were down 4% Monday, for example, as bitcoin (XBT) prices sank. Another possible concern is the threat of more competition. So far, Silvergate is one of the few banks with big exposure to bitcoin, but it’s not the only one. New York-based Signature Bank (SBNY) has a growing bitcoin business too, with about
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