Silvergate Stock Crashes 50%, Causes Ripple Effect in Crypto Market

• Silvergate Capital Corp (NYSE: SI) stock was cut nearly in half on Thursday after it delayed the submission of its annual 10-K report.
• JPMorgan analyst Steven Alexopoulos downgraded the financial services company to „underweight“ citing continued liquidity challenges.
• Coinbase also announced today that it had stopped payments to or from the crypto bank.

Silvergate Stock Crashes After 10-K Delay

Silvergate Capital Corp (NYSE: SI) stock was cut nearly in half this morning after it delayed the submission of its annual 10-K report. In a filing with the U.S. Securities and Exchange Commission (SEC), Silvergate said they were evaluating their ability to continue as a going concern and are reevaluating their businesses and strategies due to business and regulatory challenges they currently face. The lender also confirmed that it had to offload more assets than expected over the past two months, which could weigh on its capital ratio, causing Silvergate’s stock to be down 65% since its year-to-date high.

JPMorgan Analyst Downgrades Silvergate

JPMorgan analyst Steven Alexopoulos downgraded the financial services company to „underweight“ citing continued liquidity challenges, as short-sellers appear to have caused a bank run of sorts with Silvergate reporting a much greater level of deposit outflows than anticipated in Q4 and this likely continuing. In its latest reported quarter, Silvergate Capital had $1 billion of loss.

Coinbase Stops Payments To/From Crypto Bank

Coinbase also announced today that it had stopped payments to or from the crypto bank. Analysts at Canaccord Genuity also downgraded Silvergate stock on Thursday and trimmed their price target o $9 per share.

Existential Crisis For Crypto Bank

Silvergate is facing an existential crisis following the FTX fiasco in early November, which has caused investors to doubt whether the company can remain solvent for long periods of time without external assistance or major restructuring efforts from management.

Conclusion

In conclusion, Silvergate’s stock has been cut nearly in half due to its delay in submitting its 10-K report and various other factors such as liquidity issues, deposit outflows and Coinbase stopping payments involving them have contributed further towards plummeting prices for their stocks leading analysts at JPMorgan and Canaccord Genuity to downgrade them significantly while lowering their price targets too

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