Block.one Exits its Silvergate Equity Position; Reports Say
- Block.one announced that the company exited its Silvergate equity position.
- The decision was a result of Silvergate’s failure in filing the Annual Report.
- B1 added that financial institutions should use technology to benefit both traditional and modern assets.
The blockchain software company Block.one, also known as B1, announced on Wednesday that the company has withdrawn its equity position with the descending crypto and fintech financial institution, Silvergate Bank. This declaration was an aftermath of Silvergate’s failure in providing the Annual Report on Form 10-K and the subsequent decision to discontinue its SEN platform.
Notably, Block.one asserted that it exited its “Silvergate equity position” as the bank hasn’t filed its Annual Report. The platform also announced that its portfolio company, Bullish, has “no exposure to Silvergate.”
Subsequent to the Securities and Exchange Commission’s (SEC) notification regarding Silvergate’s inability to file the Annual Report for the year 2022, the latter announced its “risk-based decision” to cease its connection with its crypto payment network, the Silvergate Exchange Network (SEN).
The company announced that:
Effective immediately Silvergate Bank has made a risk-based decision to discontinue the Silvergate Exchange Network (SEN). All other deposit-related services remain operational.
Significantly, Block.one purchased a 9.27% stake in Silvergate Capital (NYSE:SI) in November, increasing it to 9.9 in the next month, making them one of Silvergate’s largest stakeholders.
Nonetheless, when the bank started falling, with its shares plummeting almost 37% to $3.11, Block.one stressed that the company is “disappointed” with the outcome.
Further, B1 added that it believes that the banks and other financial institutions will embrace the digital asset and cryptocurrency sectors. Moreover, the blockchain software company claimed that banks can take advantage of digital asset features to benefit both, traditional financial services and the new burgeoning digital asset economy to better serve the needs of the public.
Interestingly, being one of the biggest investors of Silvergate, Block.one cited in November 2022 that Silvergate’s “strong balance sheet, their strategic positioning, or their market-defiant growth trajectory” has made it a “unique investment opportunity.” However, the platform removed the post later.
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