- This is the decision made by the Federal Reserve Board
- Members of the bank’s management agreed to the requirements
- Any “bonuses” and severance packages for them must be agreed to by authorities
- Priority in liquidation will be paying off the bank’s obligations to customers
The Federal Reserve Board issued an announcement yesterday, June 1, that Silvergate will have 10 days to submit a liquidation plan. They also stressed that the organization’s management has agreed with all of the authorities’ demands.
While Silvergate Capital announced in early March that it was winding down. At the same time, the management guaranteed the repayment of all deposits.
While the bank closed voluntarily, the authorities conducted their investigation.. In the course of the audit the auditors uncovered numerous problems related to risk management and operations.. Any proposed plan would first be reviewed by the Fed and the California Department of Financial Protection and Innovation.
According to the order, Silvergate management has 10 days to submit its decision. As part of the process of liquidating the organization’s assets, any possible bonuses, as well as severance payments for members of the top management must be coordinated with the authorities. Note, Silvergate was the first crypto-friendly bank that collapsed during the crisis in March. Interestingly, the U.S. Blockchain Association is conducting its own investigation to see if the counterparty’s closure was related to its activities in the crypto-asset segment.
The U.S. Blockchain Association is conducting its own investigation to see if the closure was related to its activities in the crypto-asset segment.