California lender Silvergate settles regulatory probes for $63 million

Now-defunct California bank Silvergate is settling investigations by federal and state regulators by paying out $63 million. Silvergate collapsed spectacularly last year as its customers rushed for the exits in the wake of the FTX collapse.

According to Financial TimesThe Silvergate settlement includes penalties stemming from charges brought by the SEC, the Federal Reserve and the California Department of Financial Protection and Innovation.

Debakl at Silvergate

At one point, Silvergate was the largest cryptocurrency bank in the U.S. However, the collapse of Sam Bankman-Fried led to the collapse of FTX, which proved to be its undoing. Almost $1 billion in Silvergate deposits went to FTX and other companies controlled by Sam Bankman-Fried. In the wake of FTX’s collapse, Silvergate deposits fell by almost 52% in the final quarter of 2022. The bank had to sell its debt and assets at a loss to meet the payouts. Silvergate then closed shop in March 2023.

The SEC accused Silvergate of failing to adequately monitor and detect suspicious financial transactions. The securities watchdog also accused Silvergate and three of its executives of deceiving investors about the bank’s legality and financial condition following the collapse of FTX.

While both FTX and Silvergate are now effectively out of the cryptocurrency business, and Sam Bankman-Fried has been sentenced to 25 years in prison, cryptocurrencies are returning to full bloom. Bitcoin (BTC-USD), the world’s largest cryptocurrency, is up almost 108% over the past year.

Do we expect BTC to increase in value?

This bullish trend in the BTC market could continue in the coming days as TipRanks technical analysis tool issues a buy signal for Bitcoin on a monthly basis.

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