Silvergate Capital’s share price slumped more than 11% earlier today.
Officials from the U.S. Federal Deposit Insurance Corp are currently in talks with the crypto bank.
The federal regulator and the bank’s management are discussing ways to salvage the company.
FDIC examiners were reportedly authorized by the U.S Federal Reserve to visit Silvergate’s offices.
Silvergate Capital Corp (SI) has seen its share price tank more than 11% since the New York Stock Exchange (NYSE) opened today. The bank’s share price opened at $5.21 and fell as low as $4.60. The double-digit slump in the crypto bank’s stock came amid talks with federal regulators in the United States.
Silvergate and FDIC are trying to resolve the bank’s crisis
According to a report by Bloomberg, officials from the U.S. Federal Deposit Insurance Corporation are currently holding discussions with Silvergate’s management to explore ways to salvage the company in a bid to keep it in business. The United States Federal Reserve reportedly authorized examiners from the FDIC to visit Silvergate. The examiners reached the crypto bank’s offices in La Jolla, California, last week.
People familiar with the matter revealed that the potential options to rescue the troubled bank involve lining up investors from the crypto industry to support its liquidity as it navigates its financial predicament. While Silvergate and the Federal Reserve declined to provide a comment to Bloomberg, the FDICs stated that it does not comment on “open and operating institutions.”
Silvergate’s share price has seen a month-over-month decline of more than 72%, going from $17.3 last month all the way down to $4.8 at the time of writing. Once the go-to financial institution for companies operating in the crypto space, the bank has lost several high-profile banking partners, including Coinbase and Mike Novogratz’s Galaxy Digital, over the past few days.
The crypto bank’s financial turmoil worsened last week after it revealed that it was evaluating its ability to continue its operations. Silvergate is currently facing a probe by the U.S. Department of Justice for its dealing with bankrupt crypto exchange FTX. The crypto bank was also grilled by U.S. Senators for its role in the mismanagement of client funds by FTX.