Shares of Signature Bank fell Thursday after Silvergate, another leading bank for crypto firms, said it plans to wind down operations.

Signature’s stock price fell upwards of 10% to around $92.40 per share, its lowest price in over two years. Silvergate’s stock price plummeted over 20% to around $3.88. 

Silvergate Capital Corporation, the holding company for Silvergate Bank, cited “recent industry and regulatory developments” in its announcement Wednesday that the California-based bank would voluntarily liquidate.


The bank said it plans on repaying bank deposits to customers in full. The announcement came after Silvergate said it would shut down its Silvergate Exchange Network (SEN), a round-the-clock settlement service used by its clients.

Over the past week, multiple firms native to the digital assets industry have stepped away from Silvergate. At least four cryptocurrency exchanges including Coinbase and Gemini said their relationship with Silvergate would change as well as stablecoin issuers Circle and Paxos.

Investment firm Galaxy Digital warned it has stopped accepting or initiating transfers to Silvergate. Firms like Tether and MicroStrategy—which has the largest Bitcoin treasury among public companies—took to Twitter to quell fears about their potential exposure to the bank’s closure. MicroStrategy received a $205 million loan from Silvergate last March.

Silvergate’s stock price has been in a free fall since the bank delayed the filing of its annual financial report with the Securities and Exchange Commission last week, signaling it sustained more losses during the final quarter of last year than previously reported.


In its initial earnings report, Silvergate reported that it had $11 billion in total assets as of the end of last year. For the same period, Signature reported it had $110 billion in total assets, according to the New York-based bank's most recent earnings release.

Silvergate’s decision to close down has caused cryptocurrency prices to tumble. Ethereum and Bitcoin fell Thursday by 1.6% and 2.5%, respectively.

Though Silvergate’s troubles could result in more companies tapping Signature as a banking partner that’s familiar with crypto, Thursday’s declines suggest investors are hesitant towards banks that are involved with the asset class more broadly.

Last month, Signature was hit with a class-action lawsuit over its prior relationship with bankrupt cryptocurrency exchange FTX, which alleged Signature “had actual knowledge of and substantially facilitated the now-infamous FTX fraud.”

Last year, Signature said it planned to reduce its exposure to the digital asset industry by decreasing bank deposits for crypto firms. The bank reaffirmed that priority in a statement released Wednesday.

“We have repeatedly communicated that our relationships in the digital asset space are limited to U.S. dollar deposits only,” Signature President and COO Eric Howell said. “We remain fully committed to executing on our plan to deliberately reduce these deposits further.”

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