The bank facilitated $142 billion worth of transfers between crypto exchanges and financial institutions in Q1.
On Tuesday, Silvergate Bank, a crypto-fiat gateway network designed for financial institutions, announced
its results for the first quarter of 2022. During this period, its
revenue and net income grew by 93% and 94% year-over-year, respectively,
to $59.9 million and $24.7 million. The company is most notable for its
Silvergate Exchange Network, or SEN, which facilitates U.S. dollar and
euro transfers between cryptocurrency exchanges and institutional
investors.
Despite its growth, however, institutional interest in crypto took a significant hit in Q1 due to the ongoing bear market.
As told by Silvergate, the amount of SEN transfers it facilitated
decreased from $167 billion in Q1 2021 to $142 billion in Q1 2022.
Simultaneously, as part of broader industry trends, Bitcoin (BTC) and Ethereum (ETH) spot trading fell 33% year-over-year to $1.046 trillion in Q1 2022.
Nevertheless,
the company also saw a sharp increase in its cryptocurrency storage
segment. Partly due to an annualized cost of deposit of 0.00%,
institutional investors placed an average of $14.7 billion in digital
assets in Silvergate's hands, compared to $6.4 billion in Q1 2021.
Cointelegraph previously reported that Silvergate purchased Mark Zuckerberg's stablecoin project,
Diem, for $182 million after it became defunct. Silvergate currently
sees expanding its stablecoin infrastructure as a key area of growth. At
the moment, like traditional banks, the company derives the vast
majority of its revenue from interest income; that is, using borrowers'
deposits as collateral to issue loans, purchase interest-bearing
securities or depositing them in interest-bearing accounts at other
banks.
source link : https://cointelegraph.com/news/silvergate-bank-revenue-soar-in-q1-as-institutional-crypto-trading-activity-falls
