Bitcoin was down 5% early Friday, a day after a spout of negative developments surrounding crypto-friendly U.S. bank Silvergate. On Thursday, Coinbase, Circle, Paxos, Crypto.com, Bitstamp, Cboe Digital Markets, Galaxy Digital and Gemini all announced they will suspend Automated Clearing House transfers and other business operations with the bank. Silvergate Banks stock tumbled 58% to $5.72 on Thursday. The wider crypto market also lost ground with major altcoins taking a hit on Friday. Ether, the second-largest cryptocurrency by market capitalization, shed 5%, filecoin lost 9%, aptos was down 8%, and litecoin dropped 7%.

Will Foxley/CoinDesk

The crypto futures market also took a hit, with exchanges liquidating longs or bullish bitcoin futures worth over $62 million during Asian trading hours on Friday. That's the highest amount since August, according to data from Glassnode. Meanwhile, short liquidations totaled just over $500,000. Liquidation happens when the market moves against a trader's bullish or bearish bet, leaving him or her with insufficient funds to keep the leveraged trade open .The dominance of long liquidations shows the leverage was skewed on the bullish side, meaning most traders were positioned for a price rally.

FTX said $8.9 billion in customer funds are missing, according to a report from the Wall Street Journal, saying it identified that amount in customer funds that it can’t account for. On Thursday, FTX, a crypto exchange that filed for bankruptcy in November, said it had identified around $2.7 billion of customer assets, compared with $11.6 billion of balances outstanding on customer accounts.

Ethereum’s Shanghai upgrade, which will allow withdrawals for $29 billion of staked ether previously locked starting next month, is unlikely to cause major selling pressure and crash ETH’s price, crypto analysts told CoinDesk.

The analysts say investors’ fear the software upgrade would send prices tumbling by flooding the market with ETH are misplaced. They say the volume of ETH outflows will be less significant than many observers are predicting.

“I believe withdrawals and inflows from new stakers will be netted out,” Nick Hotz, vice president of research at digital asset investment firm Arca, told CoinDesk.

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