Crypto market tumbles as Silvergate bites the dust

Temitope Akintade
Elon Musk's heartbreak emoji tweet pushes Bitcoin back below $39,000 as other cryptos suffer dips

The past few days have shaken the market, and recent developments do not offer an optimistic picture for the short-term future. Many incidents have precipitated the bloodbath that the market is currently going through, but Silvergate, one of the major crypto banks, deciding to shut down is a big part. 

Also, another catalyst for this market downturn apart from Silvergate is the lawsuit against one of the prominent crypto exchanges, KuCoin. According to reports, Kucoin has come under regulatory scrutiny because it sold and purchased unregistered securities and commodities to users.

The market is still reeling from the effects of last year’s incidents. These Silvergate and KuCoin developments are destabilising an ecosystem with a relatively decent start to the year.

Here are major crypto stories from around the world this week

Coinbase launches Web3 wallet 

Crypto exchange Coinbase has launched a new business solution for enterprises looking to offer Web3 wallets to their customers. It says it will help streamline the adoption of Web3 products and services. 

Coinbase to lay off 950 members of its workforce

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Coinbase’s wallet-as-a-service (WaaS) provides enterprises with the technical infrastructure to create and launch customisable on-chain wallets, according to an announcement on Wednesday. Web3 wallets have struggled to gain wider mainstream acceptance because of their complexity, poor user experience and the challenges associated with maintaining mnemonic seeds.

But according to Patrick McGregor, the head of product at Coinbase’s Web3 Developer Platforms, this new solution provides:

control over end-to-end product experiences, a reduction in “

implementation cost and complexity and helps brands improve security while reducing risks.”

Crypto bank Silvergate shuts down 

In a press release on Wednesday, Silvergate Capital Corp announced that it would be winding down its operations and liquidating all assets to be able to return all deposits. The company behind the crypto-focused Silvergate Bank will follow applicable regulatory processes to shut shop and undergo voluntary liquidation.

Silvergate shuts down

The company statement said, 

“In light of recent industry and regulatory developments, Silvergate believes that an orderly wind-down of Bank operations and a voluntary liquidation of the Bank is the best path forward. The Bank’s wind-down and liquidation plan includes full repayment of all deposits. The Company is also considering how best to resolve claims and preserve the residual value of its assets, including its proprietary technology and tax assets.”

Silvergate has struggled to stay afloat ever since the FTX debacle. Despite starting the wind-down process, all deposit-related services (other than the Silveragate Exchange Network) are still operational. The company has stated that customers will be notified of any further changes.

United Kingdom cracks down on illegal ATMs

The United Kingdom Financial Conduct Authority(FCA) has initiated further action against unregistered crypto ATMs in East London. The move comes as it doubles down on its efforts to shut down the unregulated ATMs. 

The FCA stated in a press release on Wednesday that it had, in a joint operation with the Metropolitan Police, inspected several sites and used its enforcement powers. 

While crypto ATMs have become quite popular, the FCA sees them as a threat if they remain unregulated or register themselves under the relevant legal and regulatory body. 

Crypto ATMs operating without FCA registration are illegal and, as today shows, we will take action to stop this. This operation, alongside last month’s action in Leeds, sends a clear message that we will continue to identify and disrupt unregistered crypto businesses in the UK.”

Kucoin faces lawsuit 

New York Attorney-General, Letitia James has filed a lawsuit against the cryptocurrency exchange KuCoin. Per the legal document, Kucoin sold and purchased unregistered securities and commodities to users. 

James said:

“Today’s action is the latest in our efforts to rein in shadowy cryptocurrency companies and bring order to the industry. All New Yorkers and all companies operating in New York have to follow our state’s laws and regulations. KuCoin operated in New York without registration, and that is why we are taking strong action to hold them accountable and protect investors.”

Read also:

3 reasons some Nigerians still think crypto is a scam

The US regulators have the authority to sue crypto exchanges if they believe they have violated securities laws. This often occurs by selling securities and commodities without proper registration. 

Amazon to launch NFT marketplace 

The e-commerce giant Amazon is ready to launch its NFT marketplace on April 24, according to a report by TheBigWhale on Monday.

Amazon customers to start earning NFTs from playing games in 2023

From the information gathered, it appears that about fifteen collections will be available on the website through a tab called “Amazon Digital Marketplace.” This tab will initially be available only in the United States. The platform will gradually be opened to the rest of the world. 

Recall that in May 2021, an e-commerce company, eBay added NFTs to its marketplace. This Amazon development is coming when the NFT market seems to have started breathing again, touching $2 billion in trading volumes for the first time since May 2022.

That is all from us this week, see you same time next week!

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