Silvergate Bank is reaping rewards for some of the risks it took by being one of the first banks to let bitcoin companies open bank accounts. In an investor call today the La Jolla, California based bank revealed it accepted $586 million in cryptocurrency deposits in Q3 2020, bringing its total cryptocurrency assets to $2.1 billion as of September 30, 2020, compared to $1.5 billion as of June 30, 2020. Not since the record quarter of Q4 2017, when the bank took in $835 million in crypto business, has it reached such heights.
What’s interesting though, is that the bank is paving the way for how other banks can do something that has previously been the exclusive domain of off-beat cryptocurrency startups: generate actual revenue from dealing with assets issued on a blockchain. While the bank doesn’t physically custody the assets, 928 digital currency customers generated $3.3 million revenue for the bank this quarter compared to $2.4 million for the second quarter of 2020, and $1.6 million for the third quarter of 2019.