Shares of Silvergate Capital Corp (NYSE:SI) were rising on Monday after crashing by 60% last week.

The crypto bank's announcement on Friday to discontinue its flagship product, the Silvergate Exchange Network (SEN), could be a sign of the operations being wound down, according to Wedbush.

"This is a very bad sign. By waiting after the close of business to announce this, now none of the money can leave," Bloomberg quoted J. Austin Campbell, an adjunct professor of Columbia Business School, saying.

"The good news is a lot of crypto people have already cut relationships with Silvergate and moved away from them — it's less catastrophic than it could be," he added.

The Silvergate Capital Analyst: David Chiaverini downgraded the rating for Silvergate Capital from Neutral to Underperform, while reducing the price target from $9 to $4.

The Silvergate Capital Thesis: The Silvergate Exchange Network was the main attractor of funds from depositors to the bank, Chiaverini said in the downgrade note.

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"We believe a receivership/liquidation scenario is a distinct possibility and arrive at a liquidation value of $5 per share," the analyst wrote.

Our price target revision "is based on shares trading at 80% of our liquidation value per share estimate of $5 given the time value of money and an extended timeframe to settle Silvergate's affairs, which could potentially take 1-2 years, in our view," he added.

SI Price Action: Shares of Silvergate Capital were up by 2.43% to $5.90 at the time of publication on Monday.

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