• Crypto-friendly bank Silvergate announced the suspension of dividend payment on its series A preferred stock.
• Silvergate reported a $1 billion loss in the fourth quarter and also cut its staff by 20%, due to the crypto bear market and impact of FTX collapse.
• Silvergate shares fell by 11% in early morning trading following the news of the dividend suspension.
Crypto-friendly bank Silvergate recently announced the suspension of dividend payment on its series A preferred stock, a move that the company says is aimed at preserving capital in the face of recent turbulence across the crypto ecosystem. The news caused Silvergate’s shares to fall by 11% in early morning trading, hitting lows of $12.55.
The news of the dividend suspension follows Silvergate’s announcement of a $1 billion loss in the fourth quarter and the cutting of its staff by 20%. Both of these moves were attributed to the crypto bear market and the impact of FTX collapse. Silvergate, which is one of the leading banks in the crypto industry, saw its share price steadily increase throughout the summer before finally peaking at $17.73 on October 2nd.
Silvergate’s board of directors is expected to re-examine the company’s payment of quarterly dividends at a later date, with the decision dependent on how market conditions evolve. The company has said that it is committed to maintaining a highly liquid balance sheet and a strong capital position in order to navigate the volatility of the digital asset industry.
Silvergate’s announcement of the dividend suspension comes at a difficult time for the crypto industry, which has seen a sharp decline in prices since the beginning of the year. Many companies have been forced to reduce staff, cut costs, and take other measures in order to remain competitive.
In the face of such turbulence, Silvergate’s decision to suspend dividend payments on its series A preferred stock is an understandable move. The company is committed to preserving capital in order to maintain a strong position in the market and to ensure the long-term success of its operations.
Although the news of the dividend suspension has caused Silvergate’s shares to take a hit, the company remains firmly committed to its operations and its mission of providing secure and reliable banking services to the crypto industry. By taking the necessary steps to ensure its long-term success, Silvergate is well-positioned to weather the current storm in the crypto markets and to emerge stronger on the other side.