Several Silvergate lawsuits alleging FTX ties have been consolidated.

Plaintiffs seeking compensation for Silvergate’s demise have joined forces in their various claims.

A California judge has consolidated three investor cases concerning the collapsed crypto exchange FTX against the defunct crypto bank Silvergate Bank.

The three lawsuits were combined on April 19 by United States District Judge Jacqueline Scott Corley of the Northern District of California. Each accuses Silvergate of facilitating investor fraud via the defunct crypto exchange FTX.

Four former investors filed the three lawsuits against Silvergate. According to an April 19 Law360 story, they will remain separate from previous federal actions against FTX and its founder Sam Bankman-Fried, but will be combined by mutual agreement of the litigants.

According to the order: “The Silvergate cases involve common questions of law and fact, as they name common defendants, arise from the same alleged course of conduct, and assert overlapping causes of action, such that the Silvergate cases are appropriate for consolidation.”

The three lawsuits were filed in February by Matson Magleby, Golam Sakline, Nicole Keane, and Sonam Bhatia.

Silvergate, the plaintiffs claim, assisted and enabled FTX’s alleged malfeasance. Processing unlawful transfers of FTX customer monies to its sibling trading firm Alameda Research was among the actions taken.

Following a bank run, Silvergate announced plans to “voluntarily liquidate” assets and cease operations in early March. In addition, the bank was slammed with a class-action suit for securities law violations in January.

FTX declared bankruptcy in November of last year, and the subsequent crypto market slump exacerbated liquidity issues for Silvergate.

In a similar event, New York’s banking regulator has stated that the failure of Signature Bank was triggered by a run from a broad base of depositors across economic sectors, rather than crypto. Crypto-friendly Signature Bank was seized by federal regulators in March.

On April 18, at a House Financial Services Committee hearing on stablecoins, New York State Department of Financial Services (NYDFS) Superintendent Adrienne Harris stated that the demise of Signature Bank was not due to cryptocurrency.

According to a Bloomberg story from April 19, she stated that depositors such as wholesale food suppliers, fiduciaries, trust accounts, and legal companies abandoned the bank, causing the run.

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