The bear market that’s hitting all corners of the digital assets industry isn't over yet and could see some more pain over the next few quarters, according to crypto-focused bank Silvergate Capital (SI).

The crypto sector may still experience a few areas of pain for some exchanges and crypto funds over the next few quarters, “but at some point all of that will be done, and then we'll just be waiting for what's the next catalyst,” CEO and former TradFi banker Alan Lane told CoinDesk in an interview.

However, investors shouldn’t compare the current crypto price slide to previous ones given the broader global economic reset as digital assets have fallen with macro trends including rising rates and inflationary pressures, Lane said.

Shares of Silvergate are down 42% this year, though they’ve jumped 33% over the last week. The VanEck Digital Transformation Exchange-Traded Fund (DAPP), which holds a basket of various crypto stocks including exchange Coinbase (COIN) and miner Marathon Digital (MARA), has fallen 67% this year, but risen 15% over the last week. Rising rates and recession fears have hurt global equity markets, especially stocks deemed to be riskier. The tech-heavy Nasdaq Composite Index has retreated about 25% year to date.

Long-term positive

Given the crypto downturn, analysts anticipate a weak quarter for various crypto companies from exchanges to miners, but Silvergate’s second-quarter earnings bucked the trend.

The Silvergate Exchange Network (SEN), a fiat on-ramp for bitcoin (BTC) markets, posted a 34% rise in U.S. dollar transfers during the second quarter compared to last year, while net income rose 85% year over year.

Lane said the way Silvergate avoided the pitfalls of the bear market is by sticking to what the bank knows best and by not chasing FOMO. “We really try to stay in our lane and not chase the latest fad, but really just focus on what we do well, and essentially just solving problems for our customers,” Lane said.

Investment bank Canaccord Genuity thinks risk management was a key contributor to Silvergate’s positive earnings results. “What perhaps was the biggest long-term positive for the story was a risk management program that resulted in no loan writedowns, despite significant crypto spot price volatility and some default contagion across the broader ecosystem,” Canaccord equity research analyst Joe Vafi said in a note to clients.

Vafi also expects Silvergate to double its earnings over the next few years given various growth drivers that the company is embarking on. He rates the stock with a buy and $200 price target; shares closed at $86.50 apiece on Friday.