Silvergate Capital CEO Alan Lane has slammed “short sellers” and “other opportunists” for spreading misinformation over the last few weeks — just to score themselves a quick buck.
In a Dec. 5 public letter, Lane said there was “plenty of speculation – and misinformation” being spread by these parties to “capitalize on market uncertainty” caused in part to FTX’s catastrophic collapse in November.
His crypto-focused bank was recently forced to deny one of these so-called FUD (fear, uncertainty and doubt) campaigns last week when there was speculation that the firm was exposed to the bankrupt crypto lender BlockFi.
Lane also used the latest letter to the public as an “opportunity to set the record straight” about its investment relationship with FTX, as well as the company’s “robust risk management approach.”
“Silvergate conducted significant due diligence on FTX and its related entities, including Alameda Research, both during the onboarding process and through ongoing monitoring, in accordance with our risk management policies and procedures.” Read more here: https://t.co/9nAViJOzoi
— Silvergate Bank (@silvergatebank) December 5, 2022
Lane reiterated that the firm complies with the Bank Secrecy Act and the USA PATRIOT Act, which requires it to monitor and scrutinize “each and every account,” including FTX and Alameda research.
“Silvergate conducted significant due diligence on FTX and its related entities including Alameda Research, both during the onboarding process and through ongoing monitoring,” the CEO explained.
The CEO has also touted the firm’s “resilient balance sheet and ample liquidity” adding that customers’ deposits are “safely held.”
“In addition to the cash we carry on our balance sheet, our entire investment securities portfolio can be pledged for borrowings at the Federal Home Loan Bank, other financial institutions, and the Federal Reserve Discount Window – and can ultimately be sold should we need to generate liquidity to satisfy customer withdrawal request,” explained Lane.
Related: Block.one and its CEO become largest Silvergate Capital shareholders
Silvergate has also been the focus of other speculation in recent weeks, including CFA-issued accountant and former portfolio manager Genevieve Roch-Decter, who expressed doubt in a Dec. 1 post whether Silvergate could maintain its liquidity position and pondered whether it could suffer from its close relationship with FTX….
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