The headline of this article incorrectly stated that DCG invested $114 mln into Silvergate Bank. The headline has been updated.
The Digital Currency Group (DCG), a cryptocurrency venture capital firm, has reported they have invested in the Silvergate Capital Corporation, which contains the crypto-friendly Silvergate Bank, in a tweet yesterday, Feb. 26.
The Silvergate Capital Corporation had posted on its site yesterday, without disclosing the investors, that they had sold 9.5 mln shares of Silvergate stock through a private placement for a total of around $114 mln. The news post writes about the projected goals behind the acquisition:
“Proceeds from this placement will support further growth in the Bank's nationwide fintech deposit initiative and its business banking and residential lending activities.”
Cryptocurrency companies have traditionally had a hard time finding banks to accept them as customers. Over the weekend, the Bangkok Bank terminated the account of the Thai Digital Asset Exchange, and in January of this year, several Indian banks suspended or limited the accounts of crypto exchanges.
Tether, a digital token backed by fiat currency, also experienced banking problems in 2017 when all international wires to Tether were frozen by Tether’s Taiwanese banks.
DCG also tweeted that it has “huge news” from multi-currency mobile-payments app Circle, which is a DCG portfolio company:
Circle announced their acquisition of crypto exchange Poloniex yesterday, writing in their press release that they hope to grow Poloniex into a “robust multi-sided distributed marketplace.”