Silvergate Bank signs 59 new crypto clients in Q4 2018

Silvergate Bank is one of the few financial institutions in the United States saw an increase in new cryptocurrency customers in the last quarter of 2018, according to the recent filing with the United States Securities and Exchange Commission (SEC).

The filing reveals that Silvergate got an additional 59 crypto businesses signed with the bank. This brought the total number of customers to 542 by December 31, 2018, more than those filed in September 2018. Silvergate’s customers include global investors, miners and cryptocurrency exchanges.

Reportedly, about 232 crypto customers were in various stages of the bank’s ongoing customer process, including regulatory compliance.

As per the filing, in the last quarter of 2018, the bank saw 33 companies. Twenty-four investors and two exchanges come on board.

In 2018, Silvergate’s deposits from cryptocurrency customers increased by $150.4 million, or about 11.4%. Startup deposits increased to reach $273.9 million, while deposits by crypto investors saw a tremendous rise from $4.8 million to $577.5 million.

Silvergate is among the many banks globally that have chosen to accept digital currencies. The bank believes that soon more traditional financial institutions will begin to accept digital currencies. The bank stated:

“Currently, there are more than 300 institutional investment funds with aggregate estimated assets under management of between approximately $7.5 billion to $10 billion. Over $8.3 billion has been invested in digital currency-related projects, excluding initial coin offering funding, since December 31, 2013. Approximately $1.3 billion in venture funding was raised in the digital currency and blockchain market in the 12 months ended June 30, 2018, which is the most recent date such information is available.”

In the filing, the bank attributes their success to the competitive advantage they have in the industry. Silvergates explained:

“We believe our first-mover advantage serving the digital currency industry has led to numerous strategic advantages, many of which are significant barriers to entry for potential competitors. We expect that these advantages will enable us to maintain our leadership position in the industry.”

This is the first time that the bank has identified some of these clients in their filing. Silvergate mentioned Genesis Trading and investment funds Polychain Capital and Kenetic.