Silvergate shares drop by more than 20 % after the profits have been missed, StableCoin launch delay
Silvergate shares drop by more than 20 % after the profits have been missed, StableCoin launch delay
- Silvergate will not launch its stablecoin by the end of the year, the company said during the telephone conference on Tuesday
- The listed company reported a quarter of $ 1.28 per share for the third quarter of 2022 and thus missed the analyst estimates of USD 1.45
Silvergate Capital, the holding company behind the Silvergate Bank, announced that their stable coin plans were delayed, which together with a disappointing result report caused the stock to break up on Tuesday by more than 20 %.
Silvergate reported a quarter of $ 1.28 per share for the third quarter of 2022, with the analyst estimates of $ 1.45.
The bank recorded an increase in customers for digital assets, as Silvergate Capital stated in his latest report but its payment system, the Silvergate Exchange Network (sen), recorded a decline in the US-Dollar by 41 %.
The bank will also delay plans to introduce its own stablecooin, Alan Lane, CEO von Silvergate, stated at the company's conference call on Tuesday.
Silvergate acquired the technology assets of Diem, the now abandoned StableCoin project from Meta, for $ 182 million in January 2022 and announced its own plans to create an internal tokens. Silvergate said it would integrate the assets of DiEM into sen, a process that the bank expected from cost $ 30 million.
During the conference call on the results of the first quarter of Silvergate in 2022, Lane said that stable coins could be a “meaningful payment track for consumers and companies around the world”.
On Tuesday, Lane made it clear that the project will not start until the end of the year, but not because something is wrong with the technology. He found that the company works closely with the supervisory authorities to ensure that the product corresponds to the corresponding standards when launched.
Silvergate said that it is planning to infer its token with USD, but further details about the reserves have not yet been announced. The delay comes because regulatory authorities all over the world begin to take a closer look at stable coins. Legislators in the United States have in particular expressed interest in the introduction of test rules for stable coin reserves.
Silvergate was traded at $ 55.32 per share at the end of the trading session on Tuesday. The share has fallen by more than 60 % since the beginning of the year, but has still increased by over 300 % since its IPO in 2019.
The optimism of managers persisting in the entire industry, Lane, especially with regard to the recent announcements of traditional financial companies, noticed that greater interest in cryptocurrencies. "But these things need time to play off," said Lane.
"There is still a lot of institutional acceptance - none of these things are still live, they were all an announcement about upcoming things - so we could not be more optimistic about long -term development," he said.
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The post "Silvergate shares overshable by more than 20 % in the event of a refusal to results, StableCoin start delay" is not a financial advice.