Crypto Could Be Heading Into Its Biggest Week Ever After Wild Bitcoin, Ethereum, BNB, XRP, Cardano, Dogecoin, Polygon And Solana Price Swings

March 5, 2023 Brazen Crypto Team Dogecoin 0

Bitcoin
BTC
, ethereum and other major cryptocurrencies seen their recent rally collapse as a regulatory “war” on crypto heats up.

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The bitcoin price had rocketed by 50% since the beginning of 2023 but stalled out and crashed back, wiping away $100 billion from the combined ethereum, BNB
BNB
, XRP
XRP
, cardano, dogecoin, polygon and solana market and reviving fears other crypto companies could follow FTX into bankruptcy.

Now, fears are swirling around whether Silvergate, the crypto bank once described by FTX founder Sam Bankman-Fried as a major game-changer for the industry, is teetering on the verge of collapse—with one short-seller predicting the bank will implode this week.

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”I would be very surprised if the bank is open next week,” veteran short seller Marc Cohodes told The Block following a long-running Twitter campaign against the California-based company.

Silvergate, which reported a $1 billion loss for the fourth quarter, has seen its share price crash by around 95% over the last six months.

On Friday, ratings agency Moody’s downgraded Silvergate’s deposit rating after the bank said it would be delaying its annual report and warned over its “its ability to continue as a going concern.”

“The recent news regarding Silvergate’s failure to file a report to the U.S. Securities and Exchange Commission (SEC) on schedule, and Galaxy Digital and Coinbase’s decision to cut ties with them may have fueled fear amongst investors that the company’s bankruptcy is imminent,” Yuya Hasegawa, crypto market analyst at Tokyo-based Bitbank, said in emailed comments.

Crypto heavyweights led by major exchange Coinbase
COIN
 and crypto financial services company Galaxy Digital dropped Silvergate as their banking partner this week while the bank shuttered its 24-hour money transfer system known as the Silvergate Exchange Network (SEN).

“Silvergate’s death spiral is going to be rough for crypto,” venture capitalist Adam Cochran posted to Twitter. “I don’t think retail investors realize how much market maker money moved around quickly via SEN, and how many crypto exchanges were/are banking with them.”

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Silvergate, along with rival Signature Bank
SBNY
, began banking crypto exchanges and other crypto companies over the last few years, helping the industry expand via a so-called “bridge” to crypto from the world of traditional finance.

“Life as a crypto firm can be divided up into before Silvergate and after Silvergate,” FTX founder Sam Bankman-Fried was once quoted on the company’s website.

In the aftermath of FTX’s shock explosion last year, investors withdrew over $8 billion from Silvergate while the bank is also being probed by U.S. authorities over its links with FTX and sister trading company Alameda Research.