The CEO of the Silvergate exchange said that the crisis of the crypto industry is not over and may become more painful in the coming time.
Alan Lane elaborated that a number of exchanges and crypto funds will continue to experience some issues over the next few quarters:
“But at some point, everything will end, and we will just wait for what will be the next catalyst for the rise or fall in the value of cryptocurrencies.”
The head of Silvergate believes that investors should not compare the current fall in cryptocurrency prices with last year. As digital assets have fallen due to macroeconomic trends, including rising rates and inflationary pressures, the broader global economic reset should be considered here.
The volume of transfers in US dollars on the exchange increased by 34%, and net profit by 85% in the second quarter of 2022 compared to 2021. Lane believes that Silvergate’s success is due to the fact that the platform sticks to a proven strategy and avoids rash decisions:
“We really try not to chase fashion trends, but just focus on what we do well, which is, in essence, just solving customer problems.”
Despite the collapse of several overleveraged cryptocurrency companies, Lane remains confident in using bitcoin as collateral for his lending program. And promises to increase the volume of transactions.
Canaccord Genuity equity analyst Joe Vafi said in a note to clients that risk management was a key driver of Silvergate’s positive results. Already in 2018, almost 500 cryptocurrency companies became clients of Silvergate Bank.
Source: Bits
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