Silvergate Bank Sees Increase In Bitcoin Trading Volume In The First Quarter Of 2020
Silvergate Bank Sees Increase In Bitcoin Trading Volume In The First Quarter Of 2020
May 7, 2020
Silvergate Bank Sees Increase In Bitcoin Trading Volume In The First Quarter Of 2020
Silvergate Bank Sees Increase In Bitcoin Trading Volume In The First Quarter Of 2020
May 7, 2020

Silvergate Bank, the crypto-friendly bank, saw an increase in the number of digital currency customers and Bitcoin (BTC) trading and transaction volumes in the first quarter of 2020.

It has been reported that according to an April 29 transcript filed with the US Securities and Exchange Commission (SEC) on its Q1 2020 earnings, Bitcoin trading volume on the Silvergate Exchange Network (SEN) grew 75% over the previous quarter, as SEN’s BTC transaction volume also increased 118%, with more than 31,000 transactions.

However, the bank is serving 850 digital currency-related clients including cryptocurrency exchanges and miners, custodians, and global investors, as of April 2020.

It has been analyzed that as many holders saw negative returns from the crypto bloodbath, Silvergate reported “a fairly significant increase” in deposits of $447 million BTC following the March 12 downturn.

Based on the firm’s performance for the rest of Q1, Silvergate believes that it is “well-positioned” for the additional expansion of digital assets and potential volatility in the future.

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The bank said that the volatility had been a good test for SEN, which was joined by both Kraken and the Winklevoss’ Gemini exchange last year.

The exchange said:

“One of the things that we were eager to test in the pilot was the mechanism by which we are—we monitor the price of the bitcoin collateral, and then also make the “margin calls” or our—whether our customers are covering collateral shortfalls and/or whether we have to liquidate bitcoin collateral. In order to really test that, you need to see some volatility in the asset class… we saw quite a bit of volatility during the first quarter, and I’m happy to say that our monitoring worked well.”

Thus, Silvergate approved $12.5 million in BTC collateralized loans for Q1.

Source: Cointelegraph | Image: Currency


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Ishita Bora

Ishita Bora is a Senior Content Creator at Digital Notice Media Labs with an experience of 1 year. She has completed her Master's Degree in Language and Linguistics in 2019 from Gauhati University, India. Her interest lies in blockchain technology and cryptocurrency space. She loves writing about blockchain and other blockchain-related articles.