Beautiful Virgin Islands

Wednesday, Sep 03, 2025

This bitcoin bank's stock has jumped nearly 1,300% in just over a year

This bitcoin bank's stock has jumped nearly 1,300% in just over a year

The boom in bitcoin prices is giving a huge lift to a California bank that accepts cryptocurrency deposits and doles out bitcoin-backed loans.

Shares of Silvergate Capital (SI) are up more than 120% so far this year -— and the stock has skyrocketed nearly 1,300% since going public in November 2019.

Increasingly more financial services firms, such as Bank of New York Mellon (BK), Visa (V), MasterCard (MA) and BlackRock (BLK), are starting to embrace bitcoin. But arguably no bank is as "all-in" on crypto as Silvergate.

CNN Business spoke to Silvergate CEO Alan Lane about the bank's bitcoin business and what he predicts next for the world of crypto.

Silvergate decided to venture into cryptocurrencies after Lane personally invested in bitcoin for the first time in 2013, he said. He realized there was a need for a financial institution that could focus on the "plumbing" of cryptocurrency transactions, taking in deposits and making loans.

Such a bank would have to be able to serve clients at any hour of the day, he said, since bitcoin -— unlike government-backed currencies, stocks, bonds and other financial assets — never stops trading. You can't have traditional banking hours for a non-tradtiional asset.

"We started with crypto deposit accounts for customers and quickly learned that companies need more help beyond traditional 40-hours-a-week banking," Lane said. "We needed to build a bank for a 24/7 digital world."

Silvergate Capital CEO Alan Lane


Silvergate currently has about $5 billion in crypto-backed deposits. But the bank's biggest selling point for customers is its Silvergate Exchange Network (SEN), which lets clients transfer dollars to digital currency exchanges at any time.

"There is a lot of friction in banking. Wire transfers can be time consuming," Lane said. "The beauty of SEN is that once a deposit account is open, you can transact with others in seamless method and transfers are instant."

He noted there is also "more liquidity since the crypto markets are active on nights and weekends while the traditional banking system is closed."

Customers have responded to that. Silvergate announced in October that it had done more than $100 billion in transfers since it started the SEN in 2017.

Lane said the bank's customers are primarily institutional investors and other firms doing business in bitcoin and other cryptocurrencies. Customers can't, as individuals, set up an account at the bank for their bitcoin or other digital assets.

Lending to customers that want to buy more bitcoin


Silvergate's clients include Coinbase, the bitcoin wallet firm that is planning to go public later this year, and Square (SQ), the Jack Dorsey-led payments giant that allows customers to buy and sell bitcoin.

The company has also expanded its lending business to take advantage as more financial firms are looking to invest in bitcoin. The bank launched a product called SEN Leverage last year, which gives investment firms bitcoin-collateralized loans.

"Think of it like a margin loan: Customers deposit bitcoins and we then lend them dollars, which many of those clients use to buy more bitcoin," Lane said.

This all makes Silvergate's stock kind of a proxy for bitcoin. Shares tend to go up when bitcoin does and fall when the crypto's price dips. That's been good for the stock lately but it's clear that Silvergate is much riskier than your average bank stock.

Shares of Silvergate were down 4% Monday, for example, as bitcoin (XBT) prices sank.

Another possible concern is the threat of more competition. So far, Silvergate is one of the few banks with big exposure to bitcoin, but it's not the only one.

New York-based Signature Bank (SBNY) has a growing bitcoin business too, with about $10 billion in crypto deposits.

"It's been a very solid area of growth," said Eric Raymond Howell, Signature Bank's senior executive vice president of corporate and business development, on the bank's most recent earnings conference call. "We're very excited about what's happening there. It's obvious that digital assets and cryptocurrencies are not going away."

Signature Bank CEO Joseph John DePaolo added that the company is "staying ahead of the pack and not being a follower but being the leader technologically wise" and that the bank's crypto business is "growing by leaps and bounds."

Lane conceded that "Signature is probably the closest thing to competition" for Silvergate. But he thinks the bitcoin banking business is big enough for multiple players, especially since other banks are only just starting to dip their toes in the crypto waters.

"Suffice it to say that we are one of only a few banks working in bitcoin so we hope to be involved with any businesses that want to be engaged in cryptocurrencies seriously," Lane said.

Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
Germany in Turmoil: Ukrainian Teenage Girl Pushed to Death by Illegal Iraqi Migrant
United Krack down on human rights: Graham Linehan Arrested at Heathrow Over Three X Posts, Hospitalised, Released on Bail with Posting Ban
Asian and Middle Eastern Investors Avoid US Markets
Ray Dalio Warns of US Shift to Autocracy
Eurozone Inflation Rises to 2.1% in August
Russia and China Sign New Gas Pipeline Deal
China's Robotics Industry Fuels Export Surge
Suntory Chairman Resigns After Police Probe
Gold Price Hits New All-Time Record
Von der Leyen's Plane Hit by Suspected Russian GPS Interference in an Incident Believed to Be Caused by Russia or by Pro-Peace or by Anti-Corruption European Activists
UK Fintechs Explore Buying US Banks
Greece Suspends 5% of Schools as Birth Rate Drops
Apollo to Launch $5 Billion Sports Investment Vehicle
Bolsonaro Trial Nears Close Amid US-Brazil Tension
European Banks Push for Lower Cross-Border Barriers
Poland's Offshore Wind Sector Attracts Investors
Nvidia Reveals: Two Mystery Customers Account for About 40% of Revenue
Woody Allen: "I Would Be Happy to Direct Trump Again in a Film"
Pickles are the latest craze among Generation Z in the United States.
Deadline Day Delivers Record £125m Isak Move and Donnarumma to City
Nestlé Removes CEO Laurent Freixe Following Undisclosed Relationship with Subordinate
Giuliani Seriously Injured in Accident – Trump to Award Him the Presidential Medal of Freedom
EU is getting aggressive: Four AfD Candidates Die Unexpectedly Ahead of North Rhine-Westphalia Local Elections
Lula and Putin Hold Strategic BRICS Discussions Ahead of Trump–Putin Summit
WhatsApp is rolling out a feature that looks a lot like Telegram.
Investigations Reveal Rise in ‘Sex-for-Rent’ Listings Across Canada Exploiting Vulnerable Tenants
Chinese and Indian Leaders Pursue Amity Amid Global Shifts
European Union Plans for Ukraine Deployment
ECB Warns Against Inflation Complacency
Concerns Over North Cyprus Casino Development
Shipping Companies Look Beyond Chinese Finance
Rural Exodus Fueling European Wildfires
China Hosts Major Security Meeting
Chinese Police Successfully Recover Family's Savings from Livestream Purchases
Germany Marks a Decade Since Migrant Wave with Divisions, Success Stories, and Political Shifts
Liverpool Defeat Arsenal 1–0 with Szoboszlai Free-Kick to Stay Top of Premier League
Prince Harry and King Charles to Meet in First Reunion After 20 Months
Chinese Stock Market Rally Fueled by Domestic Investors
Israeli Airstrike in Yemen Kills Houthi Prime Minister
Ukrainian Nationalist Politician Andriy Parubiy Assassinated in Lviv
Corporate America Cuts Middle Management as Bosses Take On Triple the Workload
Parents Sue OpenAI After Teen’s Death, Alleging ChatGPT Encouraged Suicide
Amazon Faces Lawsuit Over 'Buy' Label on Digital Streaming Content
Federal Reserve Independence Questioned Amid Trump’s Push to Reshape Central Bank
British Politics Faces Tumultuous Autumn After Summer of Rebellions and Rising Farage Momentum
US Appeals Court Rules Against Most Trump-Era Tariffs
UK Sought Broad Access to Apple Users’ Data, Court Filing Reveals
UK Bank Shares Dive Over Potential Tax on Sector
Germany’s Auto Industry Sheds 51,500 Jobs in First Half of 2025 Amid Deepening Crisis
Bruce Willis Relocated Due to Advanced Dementia
×