Alan Lane: “Crypto companies will still face short-term crises”

Article Reading Time:
2 minutes.

The CEO of the Silvergate exchange said that the crisis in the crypto industry is not over and may become more painful in the near future.

Alan Lane clarified that over the next few quarters, a number of exchanges and cryptocurrency funds will continue to experience some problems:

“But at some point it will all end and we will just wait to see what the next catalyst is for cryptocurrencies to rise or fall in value.”

The head of Silvergate believes that investors are notshould compare the current fall in cryptocurrency prices with last year. As digital assets have fallen due to macroeconomic trends including rising rates and inflationary pressures, there is a broader global economic reset to consider here.

The volume of transfers in US dollars on the exchange has increasedby 34%, and net profit by 85% in the second quarter of 2022 compared to 2021. Lane believes Silvergate's success is due to the platform sticking to a proven strategy and avoiding rash decisions:

“We really try not to follow trends and just focus on what we do well, which is essentially just solving customer problems.”

Despite the collapse of several cryptocurrenciescompanies that were overleveraged, Lane remains confident in using Bitcoin as collateral for his lending program. And he promises to increase the volume of transactions.

</p>

Stock Market Analyst at Canaccord BankGenuity Joe Vafi said in a report to clients that risk management was a key driver of Silvergate's positive results. Already in 2018, almost 500 cryptocurrency companies became clients of Silvergate Bank.