Will the Silicon Valley Bank collapse affect crypto?

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"Up-to-date crypto information" 

The two banks that were 'most friendly to the crypto sector' as well as the biggest bank for tech startups collapsed in less than a week. Meanwhile cryptocurrency prices rallied late Sunday after the federal government stepped in to provide a backstop for depositors at the two banks. The event sparked instability in the stablecoin market.

Silvergate Capital, the main lender in the crypto industry, said on Wednesday that it would cease operations and liquidate its bank.

Silvergate Capital, a major lender to the crypto industry, said on Wednesday it would cease operations and liquidate its bank.

Meanwhile Silicon Valley Bank, the main lender to startup companies, collapsed on Friday, after depositors withdrew more than US$42 billion following the bank's statement on Wednesday that it needed to raise US$2.25 billion to shore up its balance sheet. his finances.

Signature, which also has a strong crypto focus but is much bigger than Silvergate, was seized on Sunday (12/3/2023) evening by banking regulators.

Signature and Silvergate are the two main banks for crypto companies, and nearly half of all US-backed startup ventures have funds in Silicon Valley Bank.

Including crypto-friendly venture capital funds and several digital asset firms.

The federal government stepped in Sunday to guarantee all deposits of SVB and Signature depositors, in order to boost confidence and spark a little unity in the crypto market sector.

Both bitcoin and ethereum are almost 10% more highs in the last 24 hours.

According to Mike Bucella, a longtime investor and executive in the crypto space, many people in the industry are turning to Mercury and Axos, two other banks catering to startups. Meanwhile, Circle will also publicly state that it will transfer assets to BNY Mellon after Signature bank closes.

"In the short term, crypto banking in North America is a tough place to be," said Bucella.

"However, there are plenty of challenger banks that might pick up the slack," he added.

We also have to know that the two big lots that are currently experiencing this crisis are very important for the crypto industry.

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