Coin Edition -
- Three U.S Senators have written to crypto bank Silvergate’s parent firm Silvergate Capital.
- The Senators are demanding clarity about the relationship between Silvergate and FTX.
- A similar letter was sent in December last year but the bank’s response was deemed evasive and incomplete.
Crypto bank Silvergate has once again come under fire for its questionable ties with FTX, the Bahamas-based crypto exchange that went bankrupt in November last year. United States Senators Elizabeth Warren, John Kennedy, and Roger Marshall recently penned a letter to the bank’s parent firm Silvergate Capital, seeking details about its relationship with FTX and whether it was aware of the exchange’s alleged misconduct.
The letter, addressed to Silvergate Capital’s CEO Alan Lane. highlighted the bank’s role in the improper transfer of customers’ funds from FTX to Alameda Research, the quantitative trading firm founded by Sam Bankman-Fried. The Senators also took note of the failure of Silvergate’s risk management measures.
The lawmakers took particular issue with the Federal Home Loan Bank’s $4.3 billion exposure to Silvergate. This exposure reportedly stems from a cash injection that the crypto bank received in 2022 following liquidity concerns. The Senators believe that in the event of Silvergate’s failure, the American taxpayers would be left hol ...
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