Silicon Valley bank transition: affected crypto companies include BlockFi, Circle, Avalanche

As the fallout from the surprise collapse of Silicon Valley Bank (SVB) unfolds, several crypto companies have already signaled their exposure to the bank, which has long been among the foremost lenders to tech start-ups in the world. has maintained a reputation as one of the

Bank closing friday Marked by the California Department of Financial Security as the second largest bank failure in US history after Washington Mutual was destroyed during the 2008 financial crisis. Silicon Valley Bank reported $212 billion in assets last quarter.

(SIVB) stock began to spiral late Wednesday after rumors circulated the institution was seeking acquisitions after failing to raise enough capital to meet its obligations. In the hours and days that followed, several venture capital funds reportedly advised their clients to withdraw their funds, resulting in $42 billion in withdrawals that began on Thursday, causing a bank stir. Friday morning, Nasdaq trading suspended of SIVB shares,

Although it was venture capital firms and tech startups that were most affected by SVB, several crypto companies have also disclosed their exposure to the bank.

Here is a running list of crypto firms caught in the crosshairs of the SVB collapse, as well as those that have publicly claimed to have escaped harm.

decrypt Will continue to update this list as more companies disclose their exposure.

crypto companies that had money in SVB

blockfi

Failed crypto lender Blockfi, which filed for bankruptcy in November in the wake of the collapse of FTX, has $227 million in funds in SVB, according to documents filed on Friday related to Blockfi’s bankruptcy proceedings. Those funds are reportedly not insured by the Federal Deposit Insurance Commission (FDIC) because they are in money market mutual funds, which itself may violate bankruptcy law.

BlockFi halted withdrawals for the first time just days after crypto exchange FTX exploded. The lender was previously bailed out by FTX last June with a $250 million line of credit.

circle

Circle, the issuer of USDC, the world’s second-largest stablecoin, announced on Friday that some undisclosed portion of cash reserves were held at a Silicon Valley bank to back USDC and tie its value to the US dollar.

The company said in a statement on Friday that SVB is one of six banks trusted to manage USDC’s cash reserves, but claims USDC will be able to continue operating normally.

Stable coins like USDC are cryptocurrencies that are backed and pegged to the value of real-world assets. They are meant to serve as a strong intermediary between traditional finance and the more volatile crypto markets; USDC is the second most used stablecoin in the world with a market capitalization of $42.17 billion. According to Circle, 25% of the assets backing USDC, which claims to be fully collateralized, are cash.

Last week, Circle severed ties with crypto-friendly bank Silvergate, which closed on Wednesday. Circle also used Silvergate to hold cash reserves until that time.

pantera

Crypto-focused venture capital firm Pantera may have an unknown amount of exposure to the collapse of SVB. As recently as last month, the firm counted the failed bank among just three custodians of its private funds, according to a Feb. 3 SEC filing.

Pantera counts among the largest crypto-focused VC firms in the world; Last year alone, it raised $1.3 billion for a fund that focuses exclusively on blockchain-based projects.

avalanche

The Avalanche Foundation, which supports the Avalanche blockchain, announced Friday evening that it has an exposure to a Silicon Valley bank for “a little over” $1.6 million.

Avalanche’s native token, AVAX, currently boasts a market capitalization of $4.84 billion.

Yug Labs

Yuga Labs, the $4 billion company behind major NFT collection Bored App Yacht Club (among other projects), is in contact with SVB. Yuga co-founder Greg Solano said Friday that the company has “super limited exposure” to the failed bank, although Yuga has not yet confirmed how much.

Solano said the amount “does not affect our business or plans in any way.”

Proof

Proof, another leader in NFTs, has probably been hit harder. The Web3 project created by Digg co-founder Kevin Rose, which is behind the flagship NFT collection Moonbirds, issued a statement on Friday confirming that the company has cash in the form of a Silicon Valley bank.

“Proof has cash in SVB, but… thankfully we’ve diversified our assets across ETH, stablecoins and fiat,” the company tweeted on Friday.

Proof has not yet disclosed the amount it has signed with SVB. While the company acknowledged that the SVB collapse “sucks”, it also stressed that the potential loss will not impact the security of customer assets or Proof of Stake’s roadmap.

Nova Labs

Nova Labs, the startup behind the decentralized network and internet provider Helium, disclosed its contact with SVB late Friday.

Amir Halim, CEO of Nova Labs and co-founder of Helium, said, “Nova Labs has some dollars locked up in SVBs, but the vast majority are in other institutions.

Crypto companies claiming no risk to SVB

In efforts to prevent any potential additional panic, several crypto companies have also announced a reduction in exposure to the Silicon Valley bank.

Tether, the company behind USDT, the world’s largest stablecoin, announced on Friday that it was at no risk of SVB collapsing. USDT has a market capitalization of $72.38 billion.

Solana Blockchain co-founder Anatoly Yakovenko claimed that neither Solana Labs nor the Solana Foundation had any contact with SVB.

Ryan Wyatt, President of Polygon Labs, the company behind the Ethereum scaling solution polygonsimilarly announced that any Polygon-affiliated companies or foundation had no exposure to SVB.

Other companies that announced no exposure to SVB on Friday include stigmaEmerging NFT Market, leadencrypto lending platform, crypto wallet PhantomAnd dlabsThe company behind top NFT collections DeGods and Y00ts.