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Silvergate Collapse, Alameda Lawsuit Rock Crypto World!

• Silvergate Bank parent company announced it would shut down and liquidate.
• Alameda Research is suing Grayscale Investments and its owner, the Digital Currency Group.
• The Wall Street Journal has made allegations on Tether’s “stale” practices.

Silvergate Bank Shutting Down

The Bitcoin price dropped below $20,000 as negative news spread about Silvergate Bank and its parent company’s decision to liquidate their assets. Silvergate had been in negotiations with the FDIC to avoid a shutdown but those talks failed. Companies like Coinbase, Paxos, Gemini, Galaxy Digital and BitStamp all cut ties with Silvergate when investigations began into Sam Bankman-Fried’s empire.

Alameda Research Suing Grayscale

Bankrupt Alameda Research is now suing Grayscale Investments for their exorbitant fees and refusal to unlock shareholder redemptions. The lawsuit was filed in Delaware and claims that Grayscale charged over $1.3 billion in management fees without any trust agreement violations. Shareholders have been unable to redeem their shares due to excuses made by the company.

The Wall Street Journal Alleges Tether Practices

The Wall Street Journal has recently released an article claiming that Tether’s practices are “stale”. This comes after reports of the firm’s involvement in cryptocurrency market manipulation were released earlier this year by the University of Texas at Austin, alleging that USDT was used to prop up Bitcoin prices during the 2017 bull run.

Impact on Crypto Industry

The crypto industry has taken some heavy blows lately which have impacted both institutional investors and retail traders alike. With Bitcoin’s halving more than a year away, there doesn’t seem to be any relief from these negative headlines anytime soon – signaling that Crypto Winter is still very much alive and well.


Crypto Biz reported this week on the voluntary liquidation of Silvergate Bank, Alameda Research’s lawsuit against DCG’s Grayscale Investments and The Wall Street Journal’s allegations against Tether – all of which add to growing unease among crypto investors who fear a prolonged winter ahead in spite of BTC’s halving being more than a year away.