Distressed crypto-friendly bank Silvergate has decided that liquidation is the best path forward.

In a Wednesday press release, Silvergate announced its intent to wind down operations and voluntarily liquidate the bank. 

As part of the plan, the bank will fully repay all client deposits and is considering how best to resolve claims and preserve the residual value of its assets. All deposit-related services will remain operational through the wind down process, the firm said. 

Silvergate has appointed Centerview Partners as financial advisor and Cravath, Swaine & Moore as its legal advisor. It has also brought on risk management firm Strategic Risk Associates to assist with the transition.

The decision to close up shop comes a day after news that examiners from the Federal Deposit Insurance Corporation (FDIC) were working with Silvergate on how to navigate its financial situation.

Last week, Silvergate’s troubles were made public after it delayed a 10-K filing, citing an ongoing investigation from the U.S. Department of Justice (DOJ). This prompted a number of clients, including major crypto firms like Coinbase, Circle, Gemini and Galaxy to cut ties with the firm.

Silvergate’s stock price dropped 44% to a low of $2.78 in after-hours trading. It is down 98% from its peak price of $219 in November 2021.

The bank was one of the first financial institutions to step in and partner with crypto firms, when no one else would. After Silvergate CEO Alan Lane bought Bitcoin in 2013, the bank launched an initiative to serve crypto clients.

However, the bank’s demise could mean an added layer of risk when it comes to fiat rails within the crypto ecosystem. At the end of 2022, Silvergate had 94 crypto exchanges and 894 institutional investors as clients, making it not only one of the biggest, but also one of the only banking partners for crypto firms. 

Its main rival Signature Bank, which at one point catered to crypto firms in the same capacity as Silvergate, recently moved to distance itself from the digital asset industry by refusing to service transactions less than $100,000 – something that effectively locks out all retail investors.