Business intelligence outfit MicroStrategy has confirmed a loan from Silvergate but says the tenure is still a few years away. The company added that it is not worried about Silvergate’s current financial status and will not be looking to accelerate the loan.
MicroStrategy secured a $205 million loan from Silvergate via the former’s MicroStrategy subsidiary. This credit facility was processed in March 2022. The company has now come out to say that it is not worried about the loan agreement given the current financial turmoil that Silvergate is facing.
The business intelligence outfit stated that it would not accelerate servicing the $205 million loan. Instead, it will keep to the Q1 2025 tenure previously agreed upon. MicroStrategy also stated that it has no further exposure to the troubled crypto bank.
“Our BTC collateral isn’t custodied with Silvergate and we have no other financial relationship with Silvergate,” the company tweeted.
MicroStrategy holds bitcoin on its corporate balance sheet. The company is the largest corporate holder of BTC and currently owns over 130,000 BTC, which is worth $2.9 billion as the present spot price of bitcoin.
Silvergate in crisis
MicroStrategy’s statement comes amid a fresh crisis for the embattled Silvergate. The crypto bank was caught up in the collapse of the FTX crypto exchange and has seen its finances nosedive since then.
Silvergate is currently at the center of numerous US investigations, including a class action lawsuit for money laundering. The bank is also being probed by lawmakers on Capitol Hill.
Several US crypto firms have also ditched the crypto bank including Circle and Coinbase. These companies are cutting ties with the bank due to its many legal and regulatory troubles.
The bank’s shares are currently down more than 50% amid worsening investor confidence due to Silvergate’s failure to release its financial report.