Silvergate Bank, which primarily served the cryptocurrency sector, was the first major bank to fail during the 2023 U.S. banking crisis, which also included collapses of First Republic Bank, Silicon Valley Bank, and Signature Bank.<\/p>\n
Despite its role as a significant player in the crypto market, Hetrick\u2019s filing indicates that the bank struggled to adapt to a shifting regulatory landscape in early 2023. Agencies like the Federal Reserve and FDIC signaled an unwillingness to support banks heavily involved with digital assets, forcing Silvergate to reconsider its business model.<\/p>\n
The filing highlights that Silvergate had rapidly increased its deposits from $1.8 billion at the end of 2019 to $14.3 billion by 2021, mostly from crypto clients. However, the fallout from high-profile failures like FTX in 2022 led to a dramatic decrease in deposits and a bank run, ultimately resulting in a net loss of $948.7 million in 2022.<\/p>\n