Controversial uproars have continued to rise ever since the plummet of Silvergate. This event happened after a bold reaction from a short seller, Marc Cohodes, who shared photos of the recently vacated Silvergate headquarters on Friday afternoon.

While addressing the Block, he also added that Silvergate CEO Alan Lane should be arrested and claimed that Silvergate is a crime scene disguised as a crypto trading bank. After The incident, Silvergate spokesperson and CEO Alan Lane declined to make any statements regarding the accusations.

Silvergate, the crypto bank from California, has recently suffered after former users attacked it because of its ties to Alameda Research and FTC, which recently suffered bankruptcy. A source reported that the bank had suffered a ninety-five percent loss in shares over the past six months.

On Friday, Moody’s cautioned that more rating slashes should be anticipated after Silvergate bank revealed that it was ill-managed and was unsuccessful in submitting its yearly report on time. Barely after Silvergate ratings declined, the bank publicized that it would shut down Silvergate Exchange Network, the bank’s reliable twenty-four-hour money transfer system.

Typical of most short sellers, Marc Cohodes is no exception when they say that most short sellers can be obnoxious while betting against crypto companies to gain proceeds from the companies’ downfall.

It is stereotypical of short sellers to even conspire against crypto service-providing companies. Marc Cohodes said in a post that he would be shocked if Silvergate was to open any time soon.

In Cohodes own words, he likes a good fight. In 2020, Marc Cohodes made money conspiring against Wirecard, the German creditor that fell in 2020 due to an allegation of fraud, similar to what is happening to Silvergate.

Coincidence or Prophesy?

On November 14th, Marc Cohodes released a statement that cautioned investors about Silvergate. Cohodes stated that Silvergate is a fraud-ridden company in a statement made to Hedgeye, a crypto analysis site.

He reported that he first learned about Silvergate from the co-founder of Seawolf Capital, Porter Collins. Cohodes further stated that he obsessed over shorting the Silvergate market before the onset of the 2008 financial crisis stating that Silvergate needs to be exposed like FTX was. He said all these while referring to statements to Silvergate’s stock code.

Before the 2008 financial crisis, Cohodes had spent months sharing warnings against FTX with all his followers. He had begun to doubt new and upcoming crypto companies with suspicious offshore accounts with flowing funds and concluded that it was a front for money laundering.

Cohodes confirmed Silvergate’s ties to FTX after uncovering a statement by Co-founder of FTX Sam Bankman-Fried that appeared on the website of Silvergate. The statement confirmed that FTX had made a business agreement with Silvergate that helped boost business for FTX.

Marc Cohodes reported that he began shorting Silvergate Company in November. As a result, he profited a good amount from November to last Friday, and he expects more profits as the Silvergate shares are set to plummet even further down.

Silvergate Bank now faces several investigations with investors suing for fraud. In a recent class action lawsuit, the bank has been accused of mishandling FTX customers’ funds. Silvergate has also been accused, in another lawsuit, of turning a blind eye to similar crimes being committed by Alameda Research, the hedge fund company.