Silvergate Faces New Lawsuit Over Alleged Ties to FTX and Alameda Customers Claims

Silvergate is facing renewed legal pressure after a new lawsuit was filed seeking claims from customers linked to the collapsed crypto exchange FTX and its trading arm, Alameda Research.

According to the lawsuit, investors have until January 30 to either opt out or file a claim under a $10 million settlement. The settlement concludes a case regarding whether Silvergate Bank, its parent company, and its former CEO aided FTX, Alameda, and Sam Bankman-Fried in committing a crime. 

A  December 8 court filing described the settlement as fair and reasonable, noting that the deal recovers meaningful funds from the failed bank and provides extra compensation to those affected by FTX’s collapse, on top of what they may receive from the FTX bankruptcy process.

Silvergate was one of the few U.S. banks that worked closely with crypto companies and had links to FTX at the time of its collapse in November 2022. The bank later shut down its operations on its own in March 2023.

Judge Ruth Bermudez Montenegro has scheduled a final hearing for February 9 to decide on the settlement. Court records show that over 46,000 potential complaints have been contacted, and the settlement will be divided among them.

Civil Cases Continue for FTX-Linked Individuals

Even though most criminal cases against former FTX and Alameda executives have concluded over the past three years, some civil cases are still going on, and one person connected to the exchange may still face criminal charges. 

Former FTX CEO Sam Bankman-Fried, former Alameda CEO Caroline Ellison, and former FTX Digital Markets co-CEO Ryan Salame are also in federal prison for their role in the FTX collapse. Two other executives, Nishad Singh and Gary Wang, have already served their time and are free.

Michelle Bond, the wife of Ryan Salame, is facing campaign finance charges connected to FTX in a New York federal court. Her lawyers say prosecutors pressured Salame to plead guilty by promising not to go after the Bond. The next hearing for her case is on March 4.