The fall of FTX and Alameda Research in 2022 began a tidal wave that has since severely affected other crypto-related companies, including Digital Capital Group-backed Genesis Trading, which was even recently compelled to file for chapter 11 bankruptcy protection.
As a result, regulators in the United States, who described the FTX implosion as the largest modern corporate failure, have intensified the crackdown on cryptocurrency-related companies.
For instance, the United States Securities and Exchange Commission (SEC) has indicated that all digital assets apart from Bitcoin are unregistered securities.
Additionally, the SEC has indicated that all crypto staking programs, like the one previously offered by Kraken exchange, are offering unregistered securities. As a result, Web3 firms registered in the United States have found it challenging to continue operating competitively with other companies from crypto-friendlier markets.
The notion is well elaborated by the shutdown of Silvergate Capital Corp. (NYSE: SI), whose stock market has plummeted over 96 per cent in the past year. Notably, Silvergate Capital officially announced its intent to shut down and liquidate its assets in an orderly manner on March 08.
Binance, Coinbase, and OKX Reassure Zero Exposure to Silvergate
In light of Silvergate Capital’s closure, top centralised cryptocurrency exchanges with billions in customers’ assets under custody have clarified zero exposure to the defunct crypto bank. Binance CEO Changpeng Zhao (CZ) announced through Twitter that the exchange does not have asset losses connected to the Silvergate Capital closure.
Six days ago, Coinbase Global announced that it is not accepting or initiating payments to or from Silvergate Capital. Following the closure of Silvergate Capital yesterday, Coinbase has announced that there is no client or corporate cash at Silvergate.
According to OKX CEO Hong, the fall of Silvergate is a loss to cryptocurrency adoption as it will take a longer time for a crypto to reach more people.
