The acquisition will advance Silvergate’s technical capabilities and improve its stablecoin infrastructure initiative
LA JOLLA, Calif., January 31, 2022–(BUSINESS WIRE)–Silvergate Capital Company (“Silvergate”) (NYSE: SI) at the moment introduced that it has acquired mental property and different know-how belongings associated to working a blockchain-based fee community from the Diem Group (“Diem”), additional investing in its platform and enhancing its current stablecoin infrastructure. Silvergate is uniquely positioned to leverage this know-how to additional solidify its place as a pacesetter within the digital forex trade.
The belongings acquired by Silvergate embody improvement, deployment and operations infrastructure and instruments for working a blockchain-based fee community designed to facilitate funds for commerce and cross-border remittances. The community, which has been working in a pre-launch part, was constructed by a world-class group of engineers over a two-year improvement cycle with architectural high quality evidenced by its safety, reliability and scalability. Included within the acquisition are proprietary software program parts important to working a regulatory-compliant stablecoin community.
By means of its shut partnership with Diem, Silvergate has gained deep familiarity with the community and developed robust appreciation for its potential to allow a Silvergate-issued stablecoin that may energy the way forward for world funds.
“Within the digital asset trade, cash strikes throughout the globe across the clock,” mentioned Alan Lane, Chief Govt Officer of Silvergate. “By means of conversations with our clients, we recognized a necessity for a U.S. dollar-backed stablecoin that’s regulated and extremely scalable to additional allow them to maneuver cash with out limitations. As beforehand acknowledged on our This autumn 2021 earnings name, it stays our intention to fulfill that want by launching a stablecoin in 2022, enabled by the belongings we acquired at the moment and our current know-how.”
Silvergate Financial institution, a subsidiary of Silvergate, is a California chartered and Federal Reserve member financial institution with practically a decade of expertise constructing options for the digital forex trade. Its real-time funds platform, the Silvergate Alternate Community (“SEN”), allows its clients to maneuver cash between their accounts and the accounts of different Silvergate clients 24 hours a day, 7 days every week. By integrating the belongings acquired at the moment with the SEN, Silvergate is one step nearer to launching a next-generation world fee system that’s quicker, simpler to make use of and less expensive than current options.
“We’re grateful to Diem and the neighborhood of engineers and builders who created this know-how and have superior it to its present evolution,” continued Mr. Lane. “Silvergate is dedicated to persevering with to foster the open-source neighborhood that helps the know-how, and we consider that current contributors will probably be enthusiastic about our imaginative and prescient going ahead.”
“I’m tremendously pleased with the efforts of our members, companions and groups who’ve labored tirelessly to develop the Diem Fee Community with sturdy controls to guard shoppers and fight monetary crime,” mentioned Stuart Levey, Chief Govt Officer of Diem. “We’ve confidence in Silvergate’s means to take Diem’s know-how ahead and remodel the way forward for funds.”
Beneath the phrases of the asset buy settlement, Silvergate has issued 1,221,217 shares of sophistication A typical inventory to Diem and paid $50 million in money. Based mostly on the closing worth of SI on January 31, 2022, the combination worth of the consideration was $182 million. As a part of integrating the acquired belongings into Silvergate’s current know-how, Silvergate expects to incur roughly $30 million of further prices in 2022.
Goldman Sachs & Co. LLC served as monetary advisor to Silvergate and Holland & Knight served as Silvergate’s authorized advisor. Architect Companions LLC served as monetary advisor to Diem and O’Melveny & Myers LLP, Skadden, Arps, Slate, Meagher & Flom LLP, and Fenwick & West LLP served as Diem’s authorized advisors.
About Silvergate
Silvergate Capital Company (NYSE: SI) is the main supplier of progressive monetary infrastructure options and companies for the rising digital forex trade. The Firm’s real-time funds platform, often known as the Silvergate Alternate Community, is on the coronary heart of its customer-centric suite of funds, lending and funding options serving an increasing class of digital forex corporations and buyers world wide. Silvergate is enabling the speedy progress of digital forex markets and reshaping world commerce for a digital forex future.
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Contacts
Investor Relations:
Hunter Stenback/Ashna Vasa
(858) 200-3782
investors@silvergate.com
Media:
Conor Shea
press@silvergate.com
