MicroStrategy said it has no assets held in custody by Silvergate and has no other financial ties to the bank other than a loan promised to be repaid in 2025.
It is reported that MacroStrategy, the subsidiary of MicroStrategy responsible for purchasing Bitcoin, obtained a $205 million loan from Silvergate in March 2022 through the Silvergate Exchange Network (SEN) leverage program. The loan matures in the first quarter of 2025 and will not be prepaid due to Silvergate's insolvency or bankruptcy.
According to previous news, Silvergate Capital Corporation stated in a document submitted to the U.S. Securities and Exchange Commission (SEC) that it may be "undercapitalized" and is "re-evaluating its business" and will not be able to submit its annual report on time. Following the announcement, several crypto companies including Coinbase, Paxos, Galaxy Digital, and Kraken ended their partnerships with Silvergate. Silvergate's shares fell 57% on Thursday. (CoinDesk)