Federal Deposit Insurance Corp (FDIC) officials have been consulting with executives of troubled crypto-focused bank Silvergate (SI) on how to keep the company in business, according to report from Bloomberg, citing sources familiar with the matter.
One option may involve recruiting crypto industry investors to help boost Silvergate’s liquidity, according to one of Bloomberg’s sources.
FDIC examiners were authorized to go to Silvergate’s La Jolla, Calif. headquarters last week by the Federal Reserve, which is Silvergate’s main federal overseer, according to Bloomberg.
The FDIC did not immediately return a request for comment.
Silvergate shares were rising 2.5% to $5.34 in after-hours trading on Tuesday.
Silvergate announced last week it would delay the filing of its annual report because it needed to answer requests from its independent auditors and accounting firm, in addition to pending regulatory and other inquiries and investigations. The company further warned that its ability to “continue as a going concern” over the next year might be impacted by its issues.
The majority of its crypto clients subsequently announced they had left or were leaving the company, sending Silvergate’s share price falling by more than 50% to an all-time low.
UPDATE (March 7, 22:14 UTC): Added additional background
