Will Citadel rescue Silvergate bank and also Bitcoin and the crypto market? Here is what’s going to happen

• Rumors making rounds in the crypto market are suggesting that Citadel Securities will pump into Silvergate bank to rescue it from bankruptcy. 
• Citadel is yet to respond to said rumors, but has previously played a role in increasing Silvergate’s share value by 14%. 

Cryptocurrency companies filing for bankruptcy is not a foreign concept to the market, as it recorded a large number of cryptocurrency firms file for bankruptcy last year.  As the market watches Silvergate bank closely, while predicting that it might be next in line to file for bankruptcy, some have predicted that the bank will have a successful bounce back.

Rumors circulating in the market now suggest that Silvergate bank might have a chance at making a quick recovery, as Citadel Securities is expected to step in and bail Silvergate bank.

According to the tweet which has since sparked a conversation on Twitter, Citadel will inject funds back into Silvergate, particularly to areas that are falling behind in terms of Capital.

Although no official sources were cited, neither Silvergate bank nor Citadel Securities have denied the rumors. However, with Citadel owning a certain percentage of Silvergate’s shares, some believe it is enough reason for the firm to intervene.

“UPDATE: Internal rumors at Silvergate $SI that Citadel could step up and bail them out; cash infusion where capital shortfalls exist. Citadel Securities is the world’s largest market maker and owns 5.5% of Silvergate Bank $SI.”

The tweet read.

Citadel Securities sent Silvergate’s shares surging by 14% after revealing its position in the bank

Citadel Securities is a separate entity from the hedge fund Citadel LLC, although both were founded and are majority owned by American financier Kenneth C.

Founded in 2002, Citadel Securities LLC functions as a next-generation capital markets firm. Citadel Securities is a firm known for producing liquidity and shaping market players ranging from asset managers, leading banks, hedge funds, broker-dealers, government agencies, and even public pension programs. Citadel Securities has a long line of client bases around the world.

After revealing that it had 5.5% shares in Silvergate, the firm benefitted as Silvergate shares surged by 14%. It is also worth noting that according to insider sources, Citadel Securities’ filing was a result of its market-making operations and not a directional investment in Silvergate.

Silvergate bank closed 2022 on a rather concerning note. The bank lost a whopping $8 billion in deposits from its cryptocurrency customers.

Silvergate shares dropped by more than 55 percent on Thursday after it revealed to the SEC that it will delay in filing its annual reports, as it is still contemplating its ability to stay afloat.

Meanwhile, leading exchanges like Circle, Paxos, Gemini, Coinbase, Bitstamp, Cboe Digital Markets, Galaxy Digital, and Crypto.com collectively announced that they are halting Automated Clearing House (ACH) transfers and other activities with Silvergate.

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