[Rejected] Silvergate Bank Releases Bitcoin Trading Platform with Leverage Offerings to Institutional Customers

Silvergate Bank has partnered with cryptocurrency exchange Bitstamp to release a new product, SEN Leverage, that will let its institutional customers get US dollars loans collateralized by Bitcoin held at the crypto exchange. 

A New Product for Better Customer Experience 

The new product uses the SEN (Silvergate exchange network) to process repayments and fund loans in real-time 24 hours each day, 7 days every week. The API-enabled SEN of the bank was first developed in 2017 and has experienced rapid adoption with more than $10 billion in USD transactions processed just during the third quarter of 2019 alone. 

Silvergate bank will now allow its institutional customers to gain access to greater trading capital by offering leverage on Bitcoin. Bitstamp Ltd. acts as Silvergate’s agent to custody and manages Bitcoin collateral. 

Miha Grcar, Bitstamp’s Head of Business Development said, “We see rising demand from our institutional customers to access greater trading capital. We’ve already put in place SEN to enable deposits to and withdrawals from Bitstamp accounts within minutes at any given time. We aim to offer our clients greater flexibility to manage their Bitcoins through SEN Leverage.” 

Alan Lane, Silvergate Bank CEO mentioned: “Our digital currency customers have requested us to assist them in creating greater capital efficiency, and we are happy to working in partnership with Bitstamp to address this need for them. The work and integration, which our collective team has created over the previous six months, is a demonstrated testimony we have to serve our customers.” 

Bitstamp is the largest Bitcoin exchange in Europe by trading volume, and it has become the exchange launch partner for SEN Leverage. Currently, Bitstamp supports five cryptocurrencies for trading, including BCH, EXP, LTC, ETH, BTC; the average daily trading volume was about $113 million in 2019.  

Silvergate Bank was founded in 1988 and is headquartered in California. The bank has been profitable for 22 consecutive years and has concentrated its strategy on developing the banking platform for innovators, particularly in the digital currency industry, and creating service and product solutions that address entrepreneurs’ needs. 

As of Oct. 28, 2019, Silvergate’s filling with the U.S. Securities and Exchange Commission (SEC) indicates that as of Sep. 30 2019, Silvergate Bank had stockholders’ equity of $230.6 million, total deposits of $1.8 billion, and total assets of $2.1 billion. The bank is also serving crypto clients, with more than a 15% rise over June. 

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