Silvergate Capital reveals BlockFi deposit exposure under $20 million

Silvergate Capital’s client deposits held on BlockFi accounts do not exceed $20 million, and the lending platform itself is not participating in the SEN Leverage program. The crypto bank said in a statement.

Silvergate Provides Statement on Minimal Exposure to BlockFi https://t.co/FoBqzylpr6

— Silvergate Bank (@silvergatebank) November 28, 2022

On November 28, BlockFi and eight subsidiary filed for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code. The company has more than 100,000 creditors, and its assets and liabilities are estimated to be between $1 billion and $10 billion.

The risks associated with the deposited funds in Silvergate were described as “minimal”:

«BlockFi is not acting as custodian for the bitcoin-collateralized loans SEN Leverage, which remain active—with zero losses and without forced liquidations. Silvergate has no investments in the platform». 

In conversation with The Block, a representative of the crypto bank said the organization “retains a senior lien and a security interest in the cash-secured account holding $10 million in favor of Silvergate Bank to support the BlockFi service ACH, provided by BlockFi”.

Earlier, the crypto bank disclosed that on the FTX less than 10% of its deposits were placed. The exchange did not use the SEN network.

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