Biden vows to hold those responsible for SVB
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Biden vows to hold those responsible for SVB

written by John Murphy | March 13, 2023

Us President Joe Biden vows to hold those responsible for the collapse of Silicon Valley Bank. While reassuring Americans that their deposits are safe, Signature Bank is accountable. 

The New York, financial services district took possession of Signature Bank, known for being crypto-friendly. The Federal Reserve also confirmed that the closing of Signature Bank intended to save the US economy and strengthen public trust.

It also announced a $25 million fund aimed at backstopping certain banks that may face liquidity issues in the future.

President Biden tweets that he pleased that the agencies had come up with a solution. It protects workers, small businesses, taxpayers, and the financial system. He also promised to hold those responsible for the bank collapses fully accountable.

Meanwhile, several other US politicians have shared praise for the recent actions taken by federal regulators to stem contagion from the recent banking collapse.

US Senator Sherrod Brown and Representative Maxine Waters both expressed satisfaction. They insured and uninsured SVB depositors covered in a US Senate Banking and Housing Committee Statement.

However, they noted that the actions would enable small businesses to survive and workers to get paid. They urged financial regulators to ensure the banking system remains stable, strong and resilient. And the depositor’s money is safe as they work to understand better all the factors that contributed to the recent events.

Gary Gensler, chairman of the US Securities Exchange Commission, reiterated his agency’s pursuit of wrongdoers without naming any industry. In a statement on March 12, Gensler reinforced that the SEC would be monitoring for market stability. It is identifying and prosecuting any misconduct that might threaten investors and capital formation.

He added that the SEC would investigate and bring enforcement actions. It finds violations of federal securities laws without speaking to any individual entity or person.

The shuttering of SVB temporarily triggered the de-pegging on March 11 of Circle’s USD Coin (USDC), as $3.3 billion of the circle’s $40 billion USDC reserves are held by SVB. 

However, the signature bank and SVB would make it whole. In related news, Silvergate Bank, another prominent crypto company, announced last week that it would cease operations and voluntarily liquidate. The company announced last week it would cease operations and liquidate.

Gensler wrote an opinion for ”The Hill” on March 9, threatening US crypto companies to do their work within the boundaries of the law’’.

In conclusion, President Biden vows to hold those responsible for SVB. His commitment to taking over those responsible for the bank collapses accountable along with their actions taken by federal regulators. To protect workers, small businesses, taxpayers, and the financial system has met with widespread praise from US politicians.

Chairman Gensler’s statements regarding the SEC’s pursuit of wrongdoers. The recent developments in the crypto banking industry indicate a continued effort to strengthen guardrails and ensure the banking system’s stability, strength and resilience.