At the 5-day view, the stock is down about 1.15%. SI rallied 74% over the 30-day period, ending Friday with a capitulation of 13% after 6 months. Silvergate shares traded at $93.29.
Why one Crypto Stock Fails While Its Earnings Rise
Silvergate stock fell along with other crypto stocks last quarter as it saw its revenue rise. With rising inflation and recession, investors sold shares and moved their money to other places, with crypto winter approaching.
The La Jolla bank in California, which has a special place to accommodate crypto companies who struggle to find banking services and filled its coffers like mad last quarter.
Analysts had predicted that the company would bring in $16million more cash. This month-long rally could be an indication that markets are pricing the quarter two earnings beat by U.S. crypto banks.
Silvergate’s Q2 earnings reports published $79.8million in revenue and $1.13 earnings per shares. This was $0.8 per share for a quarter 2 of 2021. The take was $42.5 million. This is a huge increase in quarterly earnings per share year-over-year.
Silvergate Capital stock was rated a Strong Buy by nine Wall Street analysts. One analyst rated the crypto stock a “Hodl” while one analyst gave SI a Buy rating.
How is it possible for the company to make so much while cryptocurrency prices plummeted from their peak in November?
What is the difference between Three Arrows Capital and Celsius Network, Voyager Digital and Silvergate Capital in crypto?
How Silvergate Earned As Another Crypto Winter Started
These three companies are currently in bankruptcy. Silvergate CEO Alan Lane stated that his company was able to pull off the triple by focusing on its strengths. He said that instead of succumbing to the “Fear of Missing Out” he would:
“We try to keep in our lane, not chase after the latest fad. We really just want to focus on what we do well and solving problems for customers.
La Jolla was once a traditional bank, while Lane was a “TradFi” banker. The bank’s fortunes have increased since Lane made the decision to work with crypto companies that were not well served. Lane stated:
“We are still open to lending against bitcoin. This is the best kind of lending we have ever done and we hope to expand it.”
Silvergate’s track record of success in risk management will be a valuable case study for both traditional financial services firms and crypto ventures looking to get into cryptocurrency.
The bank’s goal is to combine the best of both finance and the past in a crypto currency. It announced Tuesday morning the addition of Alaric Eby, Vice President of New Product Development for American Express. After serving as Vice President for New Product Development at American Express, Alaric Eby joined the Silvergate team. Eby was the head of Amex Digital Labs and oversaw Amex Express Checkout’s launch.
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