BlackRock, the world’s biggest asset manager, has announced the increase of its stake in Silvergate Capital (NYSE:SI), a crypto-friendly bank, to 7.2%. This has caused the bank’s share (SI) price to jump by 9.96%.
BlackRock (NYSE:BLK) Owns 7.2% of Silvergate
In a filing with the United States Securities and Exchange Commission (SEC) on January 31st, BlackRock disclosed it now holds 2,285,197 SI or 7.2% of the bank’s total shares, up from 6.3% year-on-year.
The announcement from BlackRock caused the share price of Silvergate Capital to rise by around 9.96%. The spike caused the price of SI to hit session highs of $14.63. SI is now valued at $14.24.
Source: Finance.yahoo
The Start of a Recovery for Silvergate?
Although the crypto industry enjoyed a strong January rally to start this year, Silvergate (SI) continues to struggle in the aftermath of the FTX blowup, causing investors to withdraw their funds from the bank.
As a result of the struggle, Silvergate reported a net loss of $1 billion during the last quarter of Q4 2022. On January 27, Silvergate said it would suspend dividend payments to shareholders to remain liquid.
However, the recent rally is a relief to investors who have seen the price of SI plummet by 87% since the start of 2022. The support from BlackRock could help it sail through the current tough market conditions.
On the Flipside
- The largest shareholder of Silvergate remains Parnassus Fund Investor Shares, which has 9,938,796 shares, representing a 31.45% stake in the bank.
Why You Should Care
By increasing its shares in Silvergate, BlackRock communicates its belief in the crypto-friendly bank and the digital asset industry.
Read more on the loss posted by Silvergate in:
Crypto Bank Silvergate Posts $1 Billion Loss, Says Industry Is in ‘Crisis of Confidence
The bank’s struggle is covered below:
Silvergate Announces 40% Job Cut, Halts Plans to Acquire Diem’s Assets