By Tim Hakki
7 min read
Illustration by Mitchell Preffer for Decrypt
Crypto prices rebounded hard this week on news that the U.S. government will intervene to ensure that depositors of the failed industry-servicing institutions Silicon Valley Bank (SVB) and Signature would be made whole.
As could be expected, Crypto Twitter was all over the topic, as it was last week; but Monday’s news brought much needed closure to the industry.
Prices had suffered as far back as the beginning of the month, when another bank called Silvergate—which actually transacted in crypto— delayed filing its annual 10-K report with the U.S. Securities and Exchange Commission (SEC), prompting speculation as to the state of its finances.
On Monday, a day after Signature was shut down by the New York state chartering authority, popular exchange Coinbase revealed the extent of its exposure to the bank and promised that its operations were business as usual.
Over in the UK that day, British Finance Minister Jeremy Hunt announced that his ministry had brokered a bailout deal in which HSBC acquired the British arm of SVB for £1 to make British businesses with exposure to the bank whole.
Crypto journalist and podcaster Jason Yanowitz tweeted a list of alternatives to the two defunct banks.
The banking crisis news had self-proclaimed cypherpunk @dystopiabreaker squaring the blame solely on the authorities and their antipathy to crypto.
Crypto venture capitalist Nic Carter, a general partner at Castle Island Ventures, said the same, using the words of Barney Frank, a former American politician, Wall Street reformer, and Signature Bank board member.
Caitlin Long, founder of crypto bank Custodia, jumped on a tweet by Forbes crypto analyst Jason Brett and joined the chorus of disgruntled crypto fans, accusing the Fed of hypocrisy and shady practice in their repeated rebuffs of her attempts to register her own institution with them.
Jessica Lessin, founder of tech publication The Information, was incensed by this bit of reporting on the SVB crisis by the Wall Street Journal. She’s right. It’s substandard.
By Thursday, it looked like the general ire with U.S. regulators had spread as far as Europe.
When it became apparent that Silicon Valley Bank was in hot water, before any word of top-down intervention, consumer sentiment towards USD Coin issuer Circle was rapidly declining. Last weekend, the dollar-pegged stablecoin actually depegged by 13 cents. At least one savvy trader worked the situation to their advantage.
On Monday, Stephane Kasriel, a FinTech leader at Facebook and Instagram parent company Meta, announced the end of NFT integration across the company. Whatever next? Will Meta abandon the metaverse pivot it's been so flamboyantly preparing for?
Avalanche founder and CEO Emin Gün Sirer announced his new post as an adviser to D.C. regulators.
Jim Cramer’s financial advice made the rounds on Tuesday, mainly for its comedy value.
Coinbase’s Conor Grogan churned a smart contract through ChatGPT-4 and found multiple vulnerabilities. Grogan is not the first and he certainly won’t be the last.
Republican House Majority Whip Tom Emmer (R-MN) on Wednesday shared a letter he sent to the Federal Deposit Insurance Corporation, accusing the regulator of using the banking crisis to instigate a purge on crypto-friendly institutions.
On Friday, Senator Elizabeth Warren tweeted some shameless and way over-the-top anti-crypto propaganda.
On the other end of the spectrum, pseudonymous Twitter economic commentator James Medlock and former Coinbase CTO and former Andreessen Horowitz partner Balaji Srinivasen are entering into a $1 million public bet over the prospect of U.S. hyperinflation and the possibility that it would cause the value of Bitcoin to skyrocket.
Decrypt-a-cookie
This website or its third-party tools use cookies. Cookie policy By clicking the accept button, you agree to the use of cookies.