Cryptocurrency Exchange, Coinbase has announced that it is ceasing payments with the crypto bank, Silvergate bank.
The firm disclosed this in a series of tweets posted on Thursday evening.
Coinbase allayed fears that client funds were endangered.
“In light of recent developments & out of an abundance of caution, Coinbase is no longer accepting or initiating payments to or from Silvergate.
” Coinbase will be facilitating institutional client cash transactions with our other banking partners and has taken proactive action to help ensure that clients experience no impact from this change.
“Client cash is held at FDIC-insured U.S. banks. When a client has a large dollar balance, Coinbase stores their cash in a U.S. government money market fund to keep it safe & liquid, ”
As reported by ‘Decrypt’, Silvergate already reported a $1 billion loss in the previous quarter as it was forced to sell assets at fire-sale prices to remain liquid and minimize the consequences of a bank run sparked by the FTX collapse.
“Last month, the bank said it expected to sell $1.7 billion of additional assets soon to repay a loan from the Federal Home Loan Bank of San Francisco,” the report said.