The Federal Home Loan Bank of San Francisco, the bank that supplied $4.3 billion to Silvergate late last year, did not force Silvergate to repay the advances which have been rumored to be the reason why the crypto-friendly bank went into voluntary liquidation, it said.

“FHLBank San Francisco did not request or compel Silvergate Bank to prepay its outstanding advances,” a spokesperson for the bank told CoinDesk. “Silvergate made their determination to prepay their outstanding advances based on their own assessment of their position.”

Silvergate Capital disclosed in a securities filing on March 1 that it had to accelerate sales of securities to raise money to repay advances from the Federal Home Loan Bank of San Francisco. It fully repaid these loans by the start of this month.

Some people in the crypto industry have speculated that that ultimately triggered the bank run on Silvergate. Silvergate’s stock price tanked a day after making the disclosure, and it announced it would suspend operations and voluntarily liquidate a few days later.

“We can't speculate as to what went into their final decision to prepay, however, the existing tenure of their remaining advances before the prepayment was short term,” the spokesperson said.

The spokesperson said that the FHLBank could require prepayment if the bank it’s loaning to experiences a “material adverse change,” but that did not happen with Silvergate.

“Again, we did not request or compel Silvergate Bank to prepay its outstanding advances. We would assume that any prudent borrower in their position would assess their own position and upcoming disclosures and make their own decisions about what was in their best interest in terms of all of their assets and liabilities,” the statement said.

#bitcoindifficulty

Good morning. Here’s what’s happening:

Prices: Bitcoin is leading the crypto rally as a flight from USDC accelerates.

Insights: Banks serving the digital asset industry will continue to exist, despite the recent banking crisis.

Prices

#Web3 #bitcoindifficulty #bicasso