Silvergate Bank Increased Total Cryptocurrency Assets To $2.1 billion

Silvergate Bank is generating income for some of the risks it took to be one of the first banks to let bitcoin businesses open bank accounts. What is important however, is that the bank is opening the way for other banks to do anything that was formerly the sole domain of unconventional cryptocurrency startups: raise real income by working with assets issued on a blockchain.

The bank’s revenue for digital currency customers jumped by almost 40% to $3.3 million, with more than 68,000 transactions on the Silvergate Exchange Network (SEN).

According to Forbes, in an investor call, the California-based bank announced that it approved $586 million in cryptocurrency deposits in Q3 2020, bringing its overall cryptocurrency reserves to $2.1 billion as of September 30, 2020, relative to $1.5 billion as of June 30, 2020. 

Alan Lane, president and chief executive officer of Silvergate, said “As we continue to grow both our digital currency customers and their utilization of the SEN, the network effect and competitive moat of our global payments platform further expands. As part of this, I am very pleased with the expansion of our newest product, SEN Leverage, which during the quarter expanded our bitcoin collateralized loans to $22.5 million in approved credit from $12.5 million in the first quarter.”

Silvergate Capital, headquartered in La Jolla , California, is a holding firm for Silvergate Bank, a supplier of solutions for the digital currency industry. Silvergate Finance, which became public in November 2019, offers services in commercial banking , corporate lending and real estate mortgage solutions. In addition, the Silvergate Exchange Network runs, a network of digital currency exchanges and digital currency investors.

The bank added 47 new digital currency clients, bringing its total customer base from the industry up to 928. It also has 200 cryptocurrency clients in the pipeline or onboarding process, Lane said. As of June 30, 2020, Silvergate had total assets of $2.3 billion, total deposits of $1.7 billion, and total stockholders’ equity of $268 million.



Image: David Schwarzenberg

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