Keeping Tabs On This Crypto Bank is Making US Watchdogs Anxious
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About 30 Percent as Silvergate Bank Shares Sink after Trading Cut-throat
The SI stock price dropped by more than 30 percent in the hours following the market shutdown. This happened when Silvergate Bank stated that they would need more time to figure out how much damage the crypto crash of 2022 had done to its finances. The company's actual results may differ from its forward-looking statements due to a number of factors. The crypto bank also gave a hint that it might be subject to future regulatory scrutiny.
Banks Facing New Regulatory Risk from Crypto
The recent losses on the bank's securities portfolios may have an impact on the capital ratios. The bank has been selling securities in response to the substantial withdrawals from its crypto customers, describing the situation as a "crisis of confidence" in the crypto industry. The regulatory capital ratios will suffer as a result of these additional losses and may result in inadequate capital for both the bank and the business. The recent occurrence of events at Silvergate Capital has compelled US authorities to reevaluate whether or not to incorporate cryptocurrencies into the conventional financial system. As a result, legislators in the United States have begun to question whether banks can manage digital asset risks.