After a tumultuous week, the 16th largest commercial bank in the US, Silicon Valley Bank, was ordered by the US government to close and confiscate its assets.
According to the announcement of the United States Federal Deposit Insurance Corporation (FDIC), this unit and the California state government have decided to close Silicon Valley Bank and confiscate assets.
The FDIC said it will open the withdrawal gate for insured deposits next Monday. Meanwhile, customers with uninsured deposits will receive a certificate of debt and wait until the FDIC liquidates the bank’s assets to receive compensation.
All insured depositors will have full access to their insured deposits by Monday morning.
The FDIC will pay uninsured depositors an advance dividend, and receivership certificate for the remaining amount of their uninsured funds.
As the FDIC sells the assets of Silicon Valley… https://t.co/UKcRH5DlfK
— db (@tier10k) March 10, 2023
The above information officially marked the collapse of Silicon Valley Bank, the 16th largest commercial bank in the United States with assets of 209 billion USD. Some major US newspapers have even called this the most serious bank failure since the Great Recession of 2008, on par with Lehman Brothers.
Silicon Valley Bank at the beginning of the trading session on March 11 (US time) said that it had failed to raise capital, leading to the stock exchanges to stop trading to worship the announcement from the financial authorities.
As reported by Kyptos, Silicon Valley Bank earlier this week announced a loss of $21 billion in securities, and announced plans to issue an additional $2.25 billion of shares to raise more money. Investors immediately expressed concern at the unexpected developments from the bank, speculating that it might be short of money and deciding to withdraw money.
SIVB’s share price during this period continuously fell over 60% for 3 consecutive days, continuing the panic in US public opinion.
The extent of the impact from the collapse of Silicon Valley Bank is still unclear, but it can be seen that the time from the disclosure of the problem to the intervention of the FDIC is less than 5 days, much shorter than the crises in the past. 2022 of crypto industry like LUNA-UST or FTX.
The concern of crypto investors right now is whether any projects, especially stablecoin issuers, keep their money on Silicon Valley Bank, and whether that has implications for the entire banking industry. American products or not. Share prices of other big banks all recorded a sharp drop in today’s session.
A potential banking crisis:$SIVB -sixty one%$FRC -60%$WAL -42%$SBNY -38%$ZION -23%$EWBC -17%$FITB -15%$CMA -15%$KEY -15%$CFG -15% pic.twitter.com/iJOoHbmPxZ
— TradingView (@tradingview) March 10, 2023
The negative news about the situation of Silicon Valley Bank is one of the reasons why the prices of leading cryptocurrencies have plummeted in the past 24 hours.