Crypto bank Silvergate’s (SI) deposit relationship with BlockFi is limited to less than $20 million of its total deposits from all digital asset customers. The company said this on Monday, hours after the crypto lender filed for bankruptcy.
Silvergate was quick to clarify BlockFi is not a custodian of its Bitcoin-collateralized SEN leverage loans. The crypto-focused bank also said that it has no investments in BlockFi.
“As the digital asset industry continues to transform, I want to reiterate that Silvergate’s platform was purpose-built to manage stress and volatility,” said Silvergate CEO Alan Lane. “The SEN continues to operate as designed, and our support teams are available 24 hours a day, 7 days a week to help our customers during this period of adversity.”
Silvergate added that it maintains a “first priority lien and security interest in a cash collateral account.” This account has $10 million “for the benefit of Silvergate to support ACH services provided to BlockFi.”
Silvergate’s announcement comes just hours after BlockFi filed for Chapter 11 bankruptcy. Filings show that the crypto lender has $257 million in cash on hand and $1-10 billion in total assets and…
