Jamie McNeill
The prices of major crypto assets are crashing once more, with Bitcoin having fallen below $23k and many other top assets falling significantly harder.
The total global crypto market cap has shrunk almost 4% on the previous 24hrs to $1.03 trillion, with leading coins such as BTC and Ethereum all more than 5% down.
Shares in Silvergate Crash 50%
One of the main reasons for the fall in prices today is the fact that shares in Silvergate bank have now fallen by more than 50% as rumors abound that the bank could be insolvent.
Silvergate has been one of the most significant companies in the entire industry and has previously issued loans to many of the top players in crypto.
Silvergate has issued loans to everyone from KuCoin to Microstrategy to Coinbase, and is the official banking partner for many of the top exchanges.
However, the crypto-friendly bank delayed the filing of its annual 10-K report earlier this week – which gives an overview of its finances – sparking panic in its clients and investors.
Timeline of #Crypto Crash Today:
1. Coinbase suspends Silvergate payments
2. SEC says crypto exchanges not "safe"
3. Crypto․com suspends Silvergate payments
4. FTX confirms $8.9 billion in missing funds
5. Crypto loses $200+ million in hours
This can't be a coincidence.
— The Kobeissi Letter (@KobeissiLetter) March 3, 2023
A Good Time to Buy the Dip with Prices Crashing?
Silvergate’s implosion could be a disaster for the industry in the short term, as many companies could have loans recalled and the amount of liquidity in the space once more faces a huge crunch.
Nevertheless, many people are optimistic that the worst of market fears are over and that now could be a fruitful time to buy the dip – particularly when one considers that much of the leverage has already been flushed out of the markets courtesy of Sam Bankman-Fried and FTX.
If it is the case that Silvergate is the last large firm that is forced to close thanks to the FTX debacle, then it could prove to be an interesting buying opportunity,
The upcoming Bitcoin halvening is now on the horizon – and expected in early 2024 – and is expected by many analysts to spark another bull run.
The crashing crypto prices today could have been significantly worse, but one must always be wary not to catch a falling knife.
It could well be the case that Silvergate’s collapse isn’t an isolated incident.
Relevant news:
- Will Crypto Regulatory Crackdown Turn the US Into a Web3 Failure or Cement its Domination?
- US Regulator Clamps Down: SEC Demands Tighter Custody Rules for Cryptocurrency
- Canadian Crypto Firms Face 30 Day Countdown to Meet Regulator Demands
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This article was written for Business 2 Community by Jamie McNeill.
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