Block.One and Founders Buy Almost 9.27% of Crypto Bank Silvergate (SI)
- The founder and CEO of developer Block.one acquired 571,351 shares from crypto bank Silvergate (SI).
- Block.one got 2,363,186 shares. Both purchases make up about 9.27% of the company, making Blumer and Block.one the largest shareholders in Silvergate.
Brendan Blumer, founder and CEO of Block.one, developer of the EOS blockchain, has bought 571,351 shares of crypto bank Silvergate (SI), according to a US Securities and Exchange Commission (SEC) document filed on Wednesday.
Blumer’s company Block.one also owns shares in Silvergate, with 2,363,186 shares purchased on November 16, the same day Blumer bought his shares. Both purchases – a total of 2,934,537 shares – represent about 9.27% of the company.
The deal makes Blumer and his company the largest shareholder in the crypto bank, according to CNN.
The Blumer purchase comes at a difficult time for Silvergate. Crypto bank shares are currently trading at around $28, which is more than 50% lower than at the beginning of November, according to data from Yahoo! Finance.
Selling pressure on Silvergate shares has occurred after the explosion of the crypto exchange FTX. Although the company denies having a large exposure to the bankruptcy exchange, there are about $1 billion in deposits with FTX. However, Silvergate has said that they represent less than 10% of all customer deposits.
Silvergate wants to launch its own stablecoin lately. It bought Meta’s failed stablecoin project, Diem, where the two companies worked for some time. This is done in hopes of integrating it into the Silvergate Exchange Network. However, in October, the world’s largest bank specializing in crypto said it was suspending its stablecoin project due to regulatory hurdles.
Silvergate’s newest and biggest shareholder is believed to have conducted the largest initial coin offering (ICO) in crypto history. Block.one raised about $4 billion for the EOS project back in the 2017-2018 ICO craze. However, it was later sued by the SEC for not registering the ICO. The company settled with the SEC for $24 million.
On the Flipside
- It’s unclear what plans Blumer and his company have for Silvergate.
Why Should You Care?
Silvergate is the largest public bank specializing in crypto. Having new investors will help weather the current crypto storm.
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