Silicon Valley Bank, Silvergate and Signature all failed as a result of poor risk management and a subsequent bank run, gckaloudis argues, not because of crypto. Opinion for 'The Node' newsletter.
who own massive financial interests in many of the companies banked by SVB.
Adding more kindling to the SVB fire – Reuters reported over the weekend that credit rating agency Moody’s was preparing to downgrade SVB’s credit rating, which potentially drove SVB to manage risk like this. On the downgrade news,SVB subsequently sold $20 billion of bonds over a weekend, which generated a loss, and then aimed to fill that hole by raising equity capital. That equity raise failed and now SVB no longer exists.
Do note, though, that SVB is more dependent on Silicon Valley startups than it is on crypto companies. Now, on Sunday, we had Signature shut down by state regulators. Signature is viewed as another crypto-friendly bank as Silvergate was. We’ve seen
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