Silvergate Bank Stock Price Forecast 2023, 2025, 2030 — Will Silvergate Collapse?

Shares of Silvergate (NYSE: SI) have been plunging in 2023 on persistent worries over the company’s viability. The SI share price hit a new low for the year on Friday, closing at $13.20. This is the lowest price the stock has been since September 2020. Since its peak in November 2021, it has dropped by more than 94%. Its overall market value is about $417 million. Are there signs that Silvergate Capital’s stock price will improve?

What is Silvergate Capital?

Silvergate Capital rose from relative obscurity to become a household name among American depositors. The company has been operating since 1987, when it specialized in commercial loans. As opposed to giants like Goldman Sachs, Morgan Stanley, and Citigroup, it never gained widespread recognition. Yet, it was just one of several regional banks in the United States.

In the past few months, Silvergate Capital has risen to prominence in the cryptocurrency market. With the CEO’s acceptance of cryptocurrency, the company rose to prominence. It has become the cryptocurrency industry’s default lender. Given that most institutions treat cryptocurrency as a hazardous asset, this is crucial information to have. As a result of the company’s openness to cryptocurrency, significant investments came in from firms like Genesis and Gemini and FTX, totaling in the billions.

What is Silvergate Exchange Network?

Silvergate Exchange Network is a vital component of Silvergate (SEN). Customers can use the service to send and receive dollars, euros, and pounds, among other fiat currencies. Service between their Silvergate accounts and those of other clients is available around-the-clock, every day of the year.

Its application programming interface (API) facilitates real-time integration of such transactions. Silvergate is regarded as the industry’s de facto central bank because it provides services to the most important exchanges.

How does Silvergate Work?

Silvergate Capital is a multi-service bank, as described. The Silvegate Exchange Network is the company’s flagship product, and it caters to the needs of brokers and hedge funds. Other crypto services offered by the firm include SEN Leverage and Institutional Custody.

Commercial banking services include cash management, mortgage warehousing, and traditional business banking. In the event of a collapse in the cryptocurrency market, the corporation may shift its attention to other sectors.

Silvergate Stock Price History

This data from 2020 reveals that Silvergate stock was trading for less than $20 per share. Due to its early focus on commercial lending, the company was not yet well-known on Wall Street. Nevertheless, during the Covid-19 pandemic, it skyrocketed in popularity due to the widespread fear of cryptographic attacks.

In November, the cost increased to $238. Silvergate’s peak market cap was approximately $4 billion. The Silvergate share price subsequently hit a new low not seen since 2020. As a result of this drop, the company’s market cap fell to around $417 million.

Silvergate Stock Price Forecast 2023

The daily chart for SI shares reveals that the price has been consistently dropping for months. At its nadir, $17.56, the lowest point since 2020, it broke below a key support level. All of the moving averages for the stock price have been broken. Similarly, volume has decreased as demand has reduced. Thus, from a purely technical perspective, selling pressure should increase.

But, if cryptocurrency investors remain enthusiastic, the stock could see a recovery. A Federal Reserve that adopts a more dovish stance would also serve as a trigger. It’s therefore possible that prices will increase by more than $30.

Silvergate Stock Price Forecast 2025

Forecasting the price of SI stock in 2025 with any degree of precision is a very challenging task. To begin, a year ago, it was not obvious that FTX would eventually fail. Bitcoin and Ethereum price recoveries in the future months are likewise impossible to forecast. Shares of Silvergate, in my opinion, will be substantially lower in 2025 than they are right now.

Silvergate Stock Price Forecast 2030

Cryptocurrencies have experienced extreme volatility over the past few years. The price of bitcoin increased from about $10 to over $67,000. Repeating the same bullish pattern over the next few years would indicate a stock price increase by the year 2030. The value of Silvergate’s stock will fluctuate according to Bitcoin’s value throughout the same time frame. Yet, Silvergate and other equities like Coinbase and Marathon Digital are not as promising as Bitcoin.

Will Silvergate Collapse?

With the collapse of the cryptocurrency market, many people wonder if Silvergate Capital would also fail. How well cryptocurrencies do in the market will determine the answer to this issue. The corporation may remain operational if the price of digital currency continues to rise, as it has this week.

If things don’t get any worse, the company should be able to keep operating as usual for the foreseeable future. In other words, I don’t think this firm will collapse under its debts. Silvergate’s total debt is approximately $5.6 billion.

Is it Safe to Invest in Silvergate Capital?

Silvergate Capital’s involvement in the cryptocurrency market makes it a very speculative investment in my opinion. Investors who are bullish on Silvergate but are considering Bitcoin should reconsider. Bitcoin, in contrast to Silvergate, has no major debts. The high-risk companies held by Silvergate include FTX, which may go insolvent in the coming months. Specifically, Wedbush analysts stated in a note that:

We believe the company’s earnings power may be further hampered by the possibility of a valuation allowance being taken against the company’s deferred tax assets.

Is it Better to Buy or Sell Silvergate Stock?

Thus, should one buy or sell shares of SI? In terms of Silvergate’s share price, analysts have a range of opinions. Wall Street firms have a median price target of $36, well above the current market price of $13. Lately, however, in light of the cryptocurrency market decline, experts have lowered their price targets for the company.

There are Morgan Stanley analysts among them. The firms of Wedbush, Craig Hallum, Wells Fargo, Bank of America, and J.P. Morgan. Tipranks reports that out of the 10 analysts it follows, 30% have a “buy” rating. Alternatively, 5 are recommended to hold and 2 should be avoided at all costs.