Crypto-friendly Silvergate Bank has made its first hire from the hardcore bitcoin community to support an ambitious roadmap for its business serving digital currency clients.
Benjamin Richman, formerly director of business development and partnerships at bitcoin tech startup Blockstream, joined the La Jolla, Calif.-based bank at the end of last month as director of digital currency.
“We’ve hired other folks that are from tech companies that were providing services to some crypto companies, and we’ve hired former law enforcement to help us with AML/KYC/BSA, but in the pure crypto space Benjamin might be the first,” Silvergate Chief Executive Alan Lane told CoinDesk.
The hire shows Silvergate’s deepening commitment to serving a niche where most banks fear to tread, owing in part to the high costs of anti-money-laundering, know-your-customer and Bank Secrecy Act compliance Lane mentioned.
At Blockstream, an outfit pursuing bleeding-edge tech improvements for bitcoin, Richman was responsible for the growth of Liquid, a sidechain, or parallel network sometimes used to move money between exchanges.
In his new job, Richman will be in charge of crypto customer growth for Silvergate. He is taking over the duty from the executive vice president of corporate development, Ben Reynolds, who will focus on the bank’s newer initiatives such as crypto-collateralized loans and the bank’s application for a New York trust company license.
Earlier this month, the bank launched the Silvergate Exchange Network’s (SEN) Leverage product, which allows proprietary traders to put up bitcoin as collateral for fiat loans they can then use to buy more bitcoin, similar to margin lending in the traditional markets. The bank also applied for the New York trust license with the aim of providing custody and settlement for crypto.
The bank, which went public on the New York Stock Exchange in November, is one of a handful in the U.S. that will provide accounts to crypto exchanges, startups and traders. (Signature, Metropolitan Commercial and Cross River are among the few others.) Early last year, Silvergate sold its retail branch and business lending team to focus on its specialty business lines, including crypto, a rich source of low-cost deposits.
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