Silvergate’s SEN Transfers Down 41% to $112B In Q3 2022

Silvergate Capital, the owner of the leading crypto bank, recently released its Q3 earnings statement. The statement was somewhat mixed with regard to performance but the bank’s president and CEO Alan Lane considers that “Silvergate delivered another quarter of strong performance.”

Silvergate Releases Q3 Earnings Statement

According to the statement, Silvergate achieved a net profit of $43.3 million—a notable increase over the second quarter’s $38.6. Out of this amount, $40.6 million will be available to common shareholders at $1.28 per share.

Silvergate also stated that its digital asset customer number grew to 1,677 from 1,305 in late September 2021. Despite this increase, digital asset fees dropped from $8.8 million in Q2 to $7.9 million. This decrease is likely just one of the effects of the current “crypto winter” which, among other things, rendered as many as 12,000 cryptocurrencies dead in the water by October.

Perhaps the most dramatic decrease found in the statement concerns The Silvergate Exchange Network (SEN). This crypto-to-fiat transaction service saw a significant drop of 41%. It handled transactions worth $112 billion in Q3 compared to $191 billion in the second quarter.

The Market Reacts to Silvergate’s Earnings Statement

The markets were quick to react to Silvergate’s report. Despite Lane’s statement that he believes his company performed well, the company’s stock fell by 22% to $55.1 on Tuesday. Afterhours didn’t bring much improvement to the situation as the slight uptrend amounted only to about 0.7%.

While the lower-than-expected results are certainly partially the cause, they likely aren’t the only ones. In a conference call with shareholders, Silvergate’s CEO announced that his company is no longer on track when it comes to issuing its stablecoin.

Lane expressed his regret that Silvergate will not be launching the stablecoin this year but stated the delay is not related to any technological issues. He explained his belief that his bank is in a better position than other banks when it comes to the issuance of its own token. He went on to state that Silvergate is also working hard on ensuring regulatory compliance—a step that is necessary to ensure a smooth launch, especially with the recent push to expand the regulatory framework.

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