How Did U.S. Senator Warren Affect the Silvergate Exchange? “Disturbing new allegations about [Silvergate’s] business practices have continued to emerge,” the letter from the Massachusetts Democrat and two Republican colleagues said.
Senators Elizabeth Warren (D-Mass.), John Kennedy (R-La.) and Roger Marshall (R-Kan.), in a letter late Monday, asked crypto-friendly bank Silvergate (SI) for answers to his work waits.
To facilitate the transfer between the FTX exchange and its sister company, Alameda Research
Following FTX’s financial filing, it was alleged that former CEO Sam Bankman-Fried made large sums of money from exchange traders at the trading firm Alameda Research, which he owns. The senators’ letter comes at a time when the investment community is wary of Silvergate’s role in the program.
FTX and related companies of Bankman-Fried’s crypto empire have about 20 different accounts at Silvergate, according to the financial filing.
“[There are] reports that Mr. Bankman-Fried ‘secretly transferred approximately $10 billion in client funds to his trading vehicle, Alameda Research,’ to support ‘risky bets’, while breaking the law U.S. security and FTX operations.” said the letter. “We are concerned about Silvegate’s role in these activities due to reports suggesting that Silvergate facilitated the transfer of FTX clients’ funds to Alameda.”
Shares are adding to their 50% decline since the FTX crash, down another 6.15% and hitting a 52-week low in Tuesday morning trading. Silver. issued the following statement, NBC reported: “Like many others, Silvergate was a victim of FTX and Alameda Research’s misappropriation of client assets and other errors of judgment. believe that our full support will help set the record straight. our work in the digital asset ecosystem.” The bank has until December 19 to respond formally to the Senate.