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Mar 12, 2023Liked by chris lynch

"SVB was over invested in treasury bonds "

Those are a pretty damn low risk investment considering the majority of funds on deposit were from crypto firms that had to keep the actual cash used in bitcoin backing somewhere, and SVB was the biggest trader in the space. Bitcoin exchanges went years leaving large sums on deposit - and expecting essentially zero returns due to the inability to bank elsewhere. That was pretty safe and profitable for the bank. When FTX collapsed, and bitcoin valuations collapsed, lots of people started cashing out of the bitcoin exchanges. That cash came directly from SVB deposits. That's why the bank capitalization disapeared. "slowly, then suddenly" as the saying goes.

No mom & pop investor using the traditional services of that bank, like they had when a decade before it had been a small real estate lender in San Diego, is likely to get busted. (That's where FDIC comes in.) The big crypto people where were last in line? Well, they can ask all those Dems who got those SBF donations for a bailout. Maybe the House will be stupid enough to go along with that idea....

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