Silvergate Capital Corp. (SI) Becomes Core Piece of Crypto Infrastructure with Fidelity Deal, PT Raised 67% to 'Street High' $150 at Canaccord Genuity

March 30, 2021 7:51 AM EDT
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(Updated - March 30, 2021 7:52 AM EDT)

Canaccord Genuity analyst Joseph Vafi raised the price target on Silvergate Capital Corp. (NYSE: SI) to a "Street High" $150.00 (from $90.00) after Fidelity chose Silvergate to enhance its crypto service offerings, becoming a key piece of institutional crypto infrastructure.

The analyst stated "Silvergate has a core competitive cost advantage in cypto margin lending, given its underlying bank charter which provides a very low cost of capital via raising zero interest customer deposits. We believe these new and very large Silvergate partners evaluated both business maturity and their own margin profiles on whether to provide margin lending themselves versus partnering; and they chose Silvergate. We also believe Silvergate will stay in its lane relative to risk management. If, over time, demand for margin lending exceeds Silveragate's ability to meet it internally, that an agency, fee-based model could evolve, given an attractive backdrop of well-funded yield centric investment funds who could step in."



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