Crypto Companies Cut Ties with Silvergate, Leading to Market Losses
The cryptocurrency market experienced a significant decline this week, with most leading tokens posting losses. The drop in prices is believed to be a reaction to the recent developments surrounding Silvergate, a crypto-friendly bank that delayed filing its yearly 10-k report with the US Securities and Exchange Commission. As a result, the bank’s shares plummeted by 57% as of Friday.
Since the news broke, several crypto companies have moved to cut ties with Silvergate. Among them are Coinbase, Crypto.com, Bitstamp, and Gemini. The move is seen as a precautionary measure to protect their businesses from any potential fallout from the bank’s troubles.
Bitcoin, the world’s largest cryptocurrency, declined by 3.1% in the past seven days, and as of this writing, it’s trading at $22,447. Meanwhile, Ethereum, the second-largest token, weathered the news better, dropping by only 1.6% to trade at $1,571, according to data from CoinGecko.
However, several top tokens saw their prices decline by double-digit percentages. Cardano, for instance, dropped by 12.5%, while Binance Coin and Polkadot lost 10.7% and 10.5%, respectively.
The market’s reaction to Silvergate’s troubles highlights the growing importance of regulatory compliance in the cryptocurrency industry. As more institutional investors and mainstream companies enter the space, they are demanding greater transparency and accountability from crypto firms. Those that fail to meet these standards risk losing the trust and support of their customers and partners.
