Matt Levine: Silverbank Had A Crypto Bank Run

$SIVB . . . Ooofta!

Church Lady Isn't that special

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This is going to get real ugly Peregrine. The poor saps are going to take it in the shorts and all the Silicon jack asses are going to ride the gravy train.

Andy

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Just as Cohodes was warning for months (and I wasn’t aware, missing an epic thread and post on Twitter, and only viewing a podcast from two months ago this week) $SIVB had crypto exposure too.

This is just too convoluted now for a one-day fix of the Feds walking in and paying off investors more than the $FDIC insurance of $250,000.

Keep an eye on these two stablecoins, because the Silicon Crypto Bros are blowing up their toilets tonight with bricks flying from their derriere’s. (Can their bidets wash away the grit of brick?) This is getting really crazy and I don’t think people who have little knowledge of crypto know are aware of what is in play with stablecoins.



Monday is going to be fun. You know everyone at FDIC, SEC, the FED, the State Comptrollers who kept funds at either of these banks will be running around tonight with their eyeballs protruding like softboiled eggs with red veins and bloodshot Irises painted on.

https://finance.yahoo.com/news/crypto-shaken-svb-exposure-depegs-135921373.html

(Bloomberg) – The fallout from the failure of Silicon Valley Bank reached further into crypto, unhinging a key cog in the market that’s meant to be among the safest digital assets in the space. The second-largest stablecoin, USD Coin traded as low as 81.5 cents as investors digested the exposure of its issuer Circle Internet Financial Ltd. to Silicon Valley Bank, which had just collapsed in one of the largest failures in US banking history.

Late Friday, after hours of silence, Circle disclosed that $3.3 billion of its roughly $40 billion stockpile of reserves was held with the failed bank. On Saturday afternoon, Chief Executive Officer Jeremy Allaire provided additional detail on Circle’s exposure to the bank, saying in a statement on the company’s blog and in tweets that USDC was “100% collateralized with a combination of cash and US Treasuries” and would remain “redeemable 1 for 1” with the US dollar. USDC’s price rallied on the statement, trading around 97 cents as of 3:45 pm in New York.

“Specifically, USDC is currently collateralized 77% ($32.4B) with US Treasury Bills (with a three month or less maturation period), and 23% ($9.7B) with cash held at a variety of institutions, of which SVB is only one,” according to the blog post. Circle’s Treasuries are held in custody at BNY Mellon, and managed by BlackRock.

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https://twitter.com/i/spaces/1OyKAVrMzADGb

So that’s why $USDT “stablecoin” has been recovering tonight.

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One of Musk’s tweets should send shivers down the spines of $TSLA bros. There’s not a regulator at work right now on this mess who would consider this, not with all the investigations going on with Twitter and Tesla at this point in time:

LOL!

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The rumor batted around on yesterday’s all-day podcast (placed on this board) prove true today. Who will be the winning bid? What will be the final bid on $SIVB assets and customer book?

https://www.bloomberg.com/news/articles/2023-03-12/fdic-auction-for-svb-said-to-be-underway-final-bids-due-sunday?srnd=premium#xj4y7vzkg

FDIC Auction for Failed SVB Underway, Final Bids Due Sunday

:pushpin: Final bids due, winner may only be known late Sunday

:pushpin: FDIC is racing to sell SVB assets before branches open Monday

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