The digital assets-focused bank said late on Friday that effective immediately it had made a "risk-based decision" to discontinue the Silvergate Exchange Network (SEN).

Shares of the La Jolla, California-based bank were down more than 4% in premarket trading, while crypto lending peer Signature Bank fell 3%. Crypto exchange Coinbase Global and BTC mining machine maker Ebang International were both down about 1% each.

"The crypto market reacted to the negative news from Silvergate Bank, with both Bitcoin and Ethereum down ~4.8% for the week," analysts at brokerage Bernstein said in an industry note.

A slew of crypto heavyweights including Coinbase Global and Galaxy Digital have dropped Silvergate as their banking partner after the lender's latest filing raised questions about its ability to continue as a going concern.

Shares in Silvergate hit a record low of $4.86 on Friday, shedding nearly 98% of their value since their record close in November 2021 and wiping out more than $7 billion from the company's market capitalization.

The firm has been struggling to stay afloat after the collapse of Sam Bankman-Fried's crypto exchange, FTX, in November drove investors to pull out $8 billion in deposits from the bank in the last three months of the year.

Silvergate reported a net loss of $1 billion in the fourth quarter.

(Reporting by Manya Saini in Bengaluru; Editing by Anil D'Silva)