Sun, July 21, 2024

Silvergate Bank Wants to Handle Cryptocurrencies

Crypto news on Monday

The crypto market continues to develop thanks to new ideas and projects. However, many banks in the U.S. as well as abroad are reluctant to work with crypto-related companies. Thus, crypto companies have to look for financial institutions willing to work with them. One such bank is Silvergate Bank from the State of California. This bank serves hundreds of crypto-related companies. Moreover, it wants to handle cryptocurrencies directly according to the CEO.

It is important to mention that Silvergate Bank is a small institution. For instance, its assets equal to 0.07% of JPMorgan. Moreover, most of the assets are composed of real estate loans.

The bank wants to focus on SEN (Silvegate Exchange Network) Leverage products. This product would allow proprietary traders to use Bitcoin as collateral for fiat loans. Traders will have the opportunity to use this loan to buy more Bitcoin.

Moreover, Silvergate Bank is working to increase the number of fiat currencies; it supports foreign exchange transactions. It plans to include at least the top five to 10 major global currencies.

Cryptocurrencies and new opportunitiesCrypto markets and financial institutions

This relatively small U.S. bank is willing to expand its crypto-related services. Silvergate Bank applied for the New York trust license; after obtaining the license, the bank will provide custody and settlement for crypto.

The bank will provide settlement services for the bitcoin trades. Silvergate would be the ensuring intermediary settlement of a fiat-for-Bitcoin exchange between two participants on the SEN. This payment platform would allow commercial customers to move U.S. dollars between crypto exchanges instantly.

Last week, the bank released fourth-quarter results. According to the data, the number of crypto client increased by 6% while deposits fell by 4%.

CEO of Silvergate Alan J. Lane commented on this topic. According to Lane, it is vital for the bank to handle digital assets.

Most likely, this service will become the first of its kind offered by a U.S. commercial bank. Such projects would help to make cryptocurrencies more popular among the clients.


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