Silvergate CEO calls out 'short sellers' spreading misinformation

Silvergate Capital CEO Alan Lane has slammed “short sellers” and “other opportunists” for spreading misinformation implicit the past fewer weeks — conscionable to people themselves a speedy buck. 

In a Dec. 5 nationalist letter, Lane said determination was “plenty of speculation – and misinformation” being dispersed by these parties to “capitalize connected marketplace uncertainty” caused successful portion to FTX’s catastrophic collapse successful November.

His crypto-focused slope was recently forced to deny 1 of these alleged FUD (fear, uncertainty and doubt) campaigns past week erstwhile determination was speculation that the steadfast was exposed to the bankrupt crypto lender BlockFi.

Lane besides utilized the latest missive to the nationalist arsenic an “opportunity to acceptable the grounds straight” astir its concern narration with FTX, arsenic good arsenic the company’s “robust hazard absorption approach.”

“Silvergate conducted important owed diligence connected FTX and its related entities, including Alameda Research, some during the onboarding process and done ongoing monitoring, successful accordance with our hazard absorption policies and procedures.” Read much here: https://t.co/9nAViJOzoi

— Silvergate Bank (@silvergatebank) December 5, 2022

Lane reiterated that the steadfast complies with the Bank Secrecy Act and the USA PATRIOT Act, which requires it to show and scrutinize “each and each account,” including FTX and Alameda research.

“Silvergate conducted important owed diligence connected FTX and its related entities including Alameda Research, some during the onboarding process and done ongoing monitoring,” the CEO explained.

The CEO has besides touted the firm’s “resilient equilibrium expanse and ample liquidity” adding that customers’ deposits are “safely held.”

“In summation to the currency we transportation connected our equilibrium sheet, our full concern securities portfolio tin beryllium pledged for borrowings astatine the Federal Home Loan Bank, different fiscal institutions, and the Federal Reserve Discount Window – and tin yet beryllium sold should we request to make liquidity to fulfill lawsuit withdrawal request,” explained Lane.

Related: Block.one and its CEO go largest Silvergate Capital shareholders

Silvergate has besides been the absorption of different speculation successful caller weeks, including CFA-issued accountant and erstwhile portfolio manager Genevieve Roch-Decter, who expressed uncertainty successful a Dec. 1 station whether Silvergate could support its liquidity presumption and pondered whether it could endure from its adjacent narration with FTX.

Roch-Decter was besides acrophobic with Silvergate’s Bitcoin-collateralized indebtedness position, which could interaction the firm’s equilibrium expanse if Bitcoin’s (BTC) terms continues to fall.

She besides expressed interest that should the firm’s Silvergate Exchange Network — a web utilized by highly utilized crypto exchanges to nonstop U.S. dollars and Euros betwixt accounts — was compromised, it could “drag down the full system.”

— Genevieve Roch-Decter, CFA (@GRDecter) November 30, 2022

Lane confirmed successful the connection that Silvergate “customers proceed to person entree to their U.S. dollar deposits erstwhile they request them and that Silvergate Exchange Network (SEN) has continued to run uninterrupted passim this period.”

“We intentionally transportation currency and securities successful excess of our integer asset-related deposit liabilities,” the CEO added.

Lane’s nationalist missive did small to stem the bleeding of Silvergate’s (SI) stock price, which fell 8.49% to $24.24 connected the New York Stock Exchange (NYSE) connected Monday, according to MarketWatch.

Silvergate’s banal is present down 52.43% implicit the past 30 days and decreased 85.34% implicit the past 12 months.