Silvergate Now Counts 928 Crypto Clients, Deposits Grew $586M in Q3

Silvergate Bank, a crypto-friendly lender that counts major crypto exchanges like Coinbase and Kraken as clients, earned $7.1 million, or $0.37 per share, in Q3 of 2020, according to its most recent earnings report.

Net income for the quarter was 29 percent higher from $5.5 million, or $0.29 a share, for the second quarter of 2020. Additionally, that marked a year-over-year expansion when compared with net income of $6.7 million for the third quarter of 2019.

In addition, the California-based bank revealed that during the three months through September 2020, its crypto-related clients grew to 928 from 756 in Q3 of 2019 and 881 at the end of June 2020.

In terms of fees earned from those clients, adding 47 new ‘Digital currency customers’ in Q3 helped Silvergate increase related income to $3.3 million, compared to $2.4 million for the second quarter of 2020. On a yearly basis, crypto fees doubled from $1.6 million it booked in Q3 of 2019.

Moreover, the crypto bank acknowledges a third quarter increase in number of transactions handled by its Silvergate Exchange Network (SEN), which rose to 68,361 transactions, up 70 percent from 40,286 transactions in the previous quarter. This figure is four times higher than the 12,312 transactions set back in the third quarter of 2019.

“We also achieved an important milestone at the conclusion of the quarter as the SEN has handled $100 billion in transfer volumes just three years after its creation and introduction to the digital currency industry, which clearly demonstrates its value and importance to the digital currency ecosystem,” said Alan Lane, president and CEO of Silvergate.

Shares up on the Earnings News

In terms of value, the global Payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term platform, which now supports cash purchases of Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term through wire transfers, experienced growth in excess of 64 percent thanks to higher volumes of bitcoin trades. Specifically, the SEN handled $36.7 billion of U.S. dollar transfers in the third quarter, compared to $22.4 billion in the April to June period of 2020, and $10.4 billion in the same quarter of 2019.

Silvergate, which is trading under the ticker (NYSE: $SI), further details that digital currency deposits grew by $586.0 million to $2.1 billion as of September 30, compared to $1.5 billion raked in by the firm’s crypto team by the end of the last quarter.

The local three-branch lender said the uptick in total deposits was driven by an increase in deposits from crypto exchanges, institutional investors in digital assets and other fintech related customers, with elevated client activity evidenced by the record volume of SEN transactions during the quarter.

Shares of Silvergate climbed 8 percent on the news, currently exchanging hands at $22.32, with a market value of about $413 million, up 85 percent from its IPO price of $12 per share.