Silvergate Adds 59 New Crypto Clients

According to its recent filing with the US SEC (Securities and Exchange Commission), Silvergate Bank signed on 59 new cryptocurrency clients for the last quarter of 2018. However, the bad news is that the bank’s deposits fell by 8% from the cryptocurrency industry.

Updated IPO Prospectus

Silvergate had filed an updated IPO (initial public offering) with the SEC. The information revealed that as of December 31, 2018, the bank, which is based out of San Diego, had a total of 542 clients from the cryptocurrency industry.

This clientele included cryptocurrency exchanges as well as institutional investors in cryptos, among others. This number is up from the 483 crypto-based clients that the bank had reported for the third quarter that ended on September 30, 2018. That is also the time that the bank had filed for its IPO.

Of the new clients that signed up with Silvergate, 2 were crypto exchanges, 24 were crypto investors and another 33 companies came under the miscellaneous category, which included Blockchain developers, service providers as well as crypto miners.

This is the first time since its SEC IPO filing that the bank identified some of its customers, a few of which were not previously known to be banking customers, such as the market maker Genesis Trading as well as Kinetic and Polychain Capital, two investment funds.

Earlier reports published by Silverbank also revealed that the bank had clients such as Xapo, the Bitcoin wallet service provider, Paxos and Circle, and crypto exchanges such as Kraken, Bitstamp, Coinbase, bitFlyer, Bittrex and Gemini.

Decline in Deposits

Despite the fact that Silvergate has seen an increase in the number of crypto customers, the deposit amounts in terms if US Dollars has actually declined by $123 million in Quarter 4 of last year.

In the third quarter, the total amount of USD deposited at the bank was $1.593 billion, however, by the end of the fourth quarter, that figure had dropped to $1.470 billion.

This shrinkage came completely from the exchanges, whose account balances went down from $174.4 million in Q3 to $618.5 million in Q4. However, deposits from investors and startups went up.

Cryptocurrency investors’ deposits went up from $4.80 million in the third quarter to $577.5 million in the last quarter of 2018. Crypto and Blockchain startups’ deposits also went up from $46.4 million to a huge $273.9 million.

Investors from the crypto industry not only make up most of the bank’s clientele, but they also own a majority stock of 13.1% in Silvergate.