Board Member of Crypto-Friendly Silvergate Bank Leaves for Polygon

By André Beganski

A member of Silvergate’s board of directors resigned Thursday, the crypto-friendly bank disclosed in a recent filing with the Securities and Exchange Commission (SEC).

Rebecca Rettig, who initially joined Silvergate’s board in March of last year, notified the company that she would be resigning yesterday. A graduate of Columbia Law School, she previously served as general counsel at Aave Companies, the group behind the decentralized finance (DeFi) platform Aave.

Silvergate stated in the filing that Rettig has decided to leave the company because she “has accepted an executive position at another company” and will focus on her new commitments, adding it was “not the result of any dispute or disagreement.”

Rettig tweeted Thursday that she’d be moving on to Polygon Labs to serve as the company’s first chief policy officer. Silvergate nor Rettig responded immediately to Decrypt’s request for comment.

“I did some soul searching about the industry & how to build a future I believe in,” she wrote. “I kept coming back to the same idea: the most important thing right now is getting crypto policy right.”

Silvergate has recently come under scrutiny from the Department of Justice, which is looking into the La Jolla-based bank’s handling of bank accounts tied to bankrupt cryptocurrency exchange FTX and Alameda Research—the trading firm owned by the exchange’s former CEO Sam Bankman-Fried.

When Bankman-Fried’s crypto empire crumbled and sparked an industry-wide bout of contagion last November, Silvergate’s crypto-related deposits were rocked. The bank disclosed that it had seen its crypto deposits fall $8.1 billion in the last fiscal quarter of last year.

At the same time, Silvergate said it drew a $4.3 billion loan from the Federal Home Loan Bank (FHLB) to weather the torrent of withdrawals, in addition to selling roughly $5.2 billion in debt securities.

U.S. lawmakers, including Elizabeth Warren (D-Mass) and John Kennedy (R-La), have criticized the bank for introducing “crypto market risk into the traditional banking system,” pressing Silvergate CEO Alan Lane in a letter.

“Congress and the public need and deserve the information necessary to understand Silvergate’s role in FTX’s fraudulent collapse, particularly given the fact that Silvergate turned to the Federal Home Loan Bank as its lender of last resort in 2022,” the officials wrote.

The bank originally launched in 1988 but has become increasingly involved in the digital assets industry over time. In early 2022, it purchased assets from Meta related to its failed Diem stablecoin project for $200 million.

Silvergate said during its most recent earnings conference that it took a $196 million impairment charge on the intellectual property and technology that it had acquired—a 98% loss. Citing the current crypto environment, Lane said it would be difficult to bring its planned stablecoin to market “anytime soon.”

“Given the significant changes in the digital asset industry landscape, this charge reflects the Company’s belief that the launch of a blockchain-based payment solution by Silvergate is no longer imminent,” Silvergate stated.

Silvergate’s stock price toppled 9% Thursday before markets closed and fell 2% further to $15.44 per share in after-hours trading. The price represented a 93% decrease from its all-time high of $222.13, set in November of 2021.

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