On TuesdaySilvergate Bank, a network of cryptocurrency gateways designed for financial institutions, announced its results for the first quarter of 2022. During this time, revenue and net profit grew 93% and 94% year-on-year, respectively, to $59.9 million and $24.7 million. The company is most notable for its Silvergate Exchange Network, or SEN, which facilitates dollar and euro transfers between cryptocurrency exchanges and institutional investors.
However, despite its growth, institutional interest in cryptocurrencies took a major hit in the first quarter due to the current bear market. According to Silvergate, the amount of SEN transfers it facilitated decreased from USD 167 billion in the first quarter of 2021 to USD 142 billion in the first quarter of 2022. Simultaneously, as part of broader industry trends, Bitcoin (BTC) and Ethereum (ETH) spot trading fell 33% year-on-year to $1.046 trillion in Q1 2022.
Nevertheless, the company also saw a strong increase in its cryptocurrency storage segment. In part due to an annualized deposit fee of 0.00%, institutional investors placed an average of $14.7 billion worth of digital assets in Silvergate’s hands, up from $6.4 billion in Q1 2021.
Cointelegraph previously reported that Silvergate purchased Mark Zuckerberg’s stablecoin project Diem for $182 million after it was defunct. Silvergate currently sees the expansion of its stablecoin infrastructure as a key growth area. At the moment, tol Like traditional banks, the company derives the vast majority of its income from interest income; that is, using borrowers’ deposits as collateral to issue loans, buy interest-bearing securities, or deposit them in interest-bearing accounts at other banks.
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