Crypto News: Fears over Silvergate finances, $8B hole at FTX and other news


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A week in review: Feb. 26 – March 4

Your weekly highlights to stay up to date with the latest crypto news

#1. Silvergate stock plunges after delayed filing raises doubts over future

Silvergate made headlines this week after postponing the filing of its annual 10-K financial report, raising fears of an upcoming bankruptcy filing. The collapse of the cryptocurrency bank could prove costly for the rest of the industry. Within 24 hours after the announcement, Coinbase, Circle, Bitstamp, Galaxy Digital and Paxos confirmed that they will scale back their individual partnerships with Silvergate in some capacity. MicroStrategy and Tether joined a number of firms publicly denying any meaningful exposure to the bank. On March 2, Silvergate's stock plummeted by over 50% on the NYSE.

#2. FTX presentation shows 'massive shortfall' in firm's assets

Bankrupt cryptocurrency exchange FTX has revealed a "massive shortfall" in its digital asset and fiat currency holdings, with billions worth of customer funds missing from both the exchange and its United States-based arm, FTX US. In total, FTX recorded an $8.6 billion deficit across all wallets and accounts while FTX US recorded a deficit of $116 million. Among the week's headlines, former FTX engineering director Nishad Singh pleaded guilty to charges of wire fraud along with wire and commodities fraud conspiracy. Singh's plea follows a number of Sam Bankman-Fried's close associates reportedly agreeing to cooperate with U.S. prosecutors in recent months.

#3. Celsius Custody customers finally begin withdrawals 263 days after freeze

For the first time in 263 days, Celsius customers have been able to withdraw funds following a freeze before its bankruptcy filing. Affected customers received an email listing those who were eligible to withdraw funds a few weeks ago, followed by another on March 2 notifying them that withdrawals were available. Customers who held funds in custody accounts — only available to U.S. residents — were able to withdraw 94% of their original funds. Customers who transferred funds from earn or borrow accounts to custody accounts can currently withdraw 72.5% of funds.

#4. Prediction of the week. Bitcoin price slides amid Silvergate uncertainty

Bitcoin fell 5% in a single hour overnight into March 3, dropping to its lowest levels in over two weeks, data from Cointelegraph Markets Pro and TradingView shows, as cryptocurrency markets reacted to Silvergate bank's liquidity and BTC bulls failed to defend already weak support.

For some traders, the leg down for Bitcoin was already only a matter of time, as BTC price action has spent weeks trying and failing to overcome resistance above $25,000.

Pseudonymous trader Credible Crypto noted in an update that the target support price lies around the $20,000 mark — a key psychological level originally reclaimed as support in January. "If they fail to, then my downside target will be met sooner rather than later," the trader said.

#5. FUD of the week. Bitcoin ATM decline: Over 400 machines went off the grid in under 60 days

Crypto ATMs have seen a drastic reduction this year. In the first two months of 2023, the net number of cryptocurrency ATMs installed globally reduced by 412 machines. Between December 2020 and January 2022, more than 1,000 crypto and Bitcoin ATMs were being installed every month. Its growth was hindered, however, by the bear market. Crypto ATMs are considered one of the key infrastructure pillars for the mass adoption of cryptocurrencies.

#6. FUD of the week. Robinhood subpoenaed by SEC over crypto listings and custody

Robinhood Markets received an investigative subpoena from the United States Securities and Exchange Commission (SEC) in December, the company disclosed on Feb. 27. The subpoena relates to its digital asset business's crypto listings, custody and platform operations, and it was received a month after crypto exchange FTX filed for bankruptcy, following "several other major cryptocurrency trading venues and lending platforms earlier in 2022."