Silvergate Downgraded by JPMorgan, Canaccord Amid Doubts of Firm’s Solvency

Downgrade of Silvergate Capital

  • JPMorgan cut its rating on the stock to “underweight” from “neutral” and withdrew its price target.
  • Canaccord Genuity also downgraded Silvergate’s rating to “hold” and reduced its price target to $9.
  • Silvergate is facing liquidity issues due to the fallout of FTX collapse and increased deposits outflows.

JP Morgan Ratings Drop

JPMorgan dropped their rating for Silvergate Capital (SI) from “neutral” to “underweight,” as well as withdrew their price target. The crypto bank said it needed an additional two weeks in order to complete filing its annual 10-K for 2022, which caused the drop in ratings.

Canaccord Genuity Downgrade

Canaccord Genuity downgraded Silvergate’s rating from “buy” to a mere “hold,” reducing their price target for the stock from $25 to only $9. This came as a result of a $886 million loss due to selling underwater securities that halved the tangible book value per share down to $12.93.

FTX Collapse Fallout

The downfall of FTX had a direct impact on Silvergate, with around $1 billion worth of deposits being held at the time of collapse. Furthermore, short sellers have been reported contributing towards a “bank run” by increasing deposit outflows beyond what was anticipated in fourth quarter and continuing so far into first quarter 2021.


In conclusion, JPMorgan and Canaccord have both lowered their ratings on Silvergate Capital due to liquidity issues stemming from the fallout of FTX collapse as well as increased deposits outflows caused by short sellers. As such, investors should remain cautious when investing in this company until further updates are released or ratings improve.