Coinbase, Galaxy, Paxos stop accepting transfers via Silvergate Network

economictimes.indiatimes.com:

This time, the counterparty is Silvergate Capital Corp., the bank behind a widely used payments network that facilitates the real-time transfer of money between crypto firms. Silvergate suffered from a run on deposits already last year, triggered by the bankruptcy of its key client FTX. On Wednesday, the bank said it sold more debt holdings at a loss and was reviewing whether it can remain viable. It also indicated it was being investigated by the US Justice Department. That warning prompted swift reactions by crypto exchanges, stablecoin issuers and trading desks. Coinbase Global Inc., Galaxy Digital and Paxos Trust Co. announced that they will no longer accept or initiate payments through Silvergate, as did Gemini Trust Co., Crypto.com and Cboe Clear Digital LLC.

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Circle Internet Financial Ltd., the issuer of stablecoin USDC, said it’s “unwinding certain services” with Silvergate. Cumberland, the crypto division of Chicago-based trading giant DRW, said that it had “minimal exposure” on Silvergate over the last few months.

Shares of the La Jolla, California-based Silvergate fell 58% Thursday. The stock fell 88% last year as the prices of cryptocurrencies tumbled amid a series of industry scandals and bankruptcies, including FTX. Silvergate delayed the filing of its 10-K annual report Wednesday and said “it is working diligently to file its 10-K as soon as possible.” The exodus threatens