U.S. Senator Elizabeth Warren recently tweeted that Silvergate Bank’s bankruptcy is regrettable but unsurprising given that it was the preferred bank for cryptocurrency. She said she had found serious due diligence shortcomings and warned of Silvergate’s dangerous and criminal behavior. Customers now need to be compensated, and regulators need to take action against the crypto danger.
This is regarding Silvergate recently winding down operations and voluntarily liquidating its bank after a collapse in the crypto market which saw billions in deposits leaving the bank in recent months.
The Senator’s words have garnered heavy criticism. Here’s the whole story.
Novogratz mocks Warren
Mike Novogratz, a cryptocurrency investor and the creator of Galaxy Digital, tweeted a dig at U.S. Senator Elizabeth Warren after she criticized Silvergate.
Novogratz mockingly commended Warren for being “so smart” in his tweet and joked that people should inquire about Modern Monetary Theory (MMT), calling it a “great idea.” He also said that Warren was the ideal partner for Bitcoin.
He suggested that Warren’s remarks about the actions of Silvergate Bank and the need for regulation are misguided and show her ignorance of the advantages of cryptocurrencies, particularly Bitcoin (BTC).
What happened with Silvergate?
According to reports, the collapsed bank lost $1 billion in the fourth quarter. Several of its partners, including well-known companies like Coinbase and Galaxy Digital, which is owned by Novogratz, have hurried to disassociate themselves from the troubled bank.
Warren, who has established herself as one of the most vocal opponents of cryptocurrency, has begun enlisting conservative Republicans in the Senate to back her crypto legislation. The contentious measure aims to enforce stricter anti-money-laundering regulations.
Novogratz’s remark is just one example of how those in the crypto business are growing public in their disapproval of Warren and her crypto attitude. There have been harsh criticisms leveled against her. Some claim that she causes issues before attempting to fix them. Others have reminded her that this could have been minimized and mitigated if her public servant friends had ceased meeting criminals in private and really performed their duties.