[yalogin]

As someone that is not following this as closely as I would like, does the collapse of this bank have nothing to do with FTX and Crypto?

[jandrese]

Only indirectly. They released a statement after the FTX collapse saying effectively "don't worry, no problem here", which caused a bank run that they couldn't manage and forced the collapse.

[kevin_thibedeau]

Jedi mind trick only works if you're a Jedi.

[timy2shoes]

They are related in that crypto (and ftx) and the massive explosion of start-ups are a low-interest rate phenomena.

[tekla]

FTX was simple fraud. This isn't really related and is more standard bank taking on wayy too much risk.

[thepasswordis]

FTX was because they took customer deposits and gambled with them, lost the gamble, and therefore lost the money.

[mannerheim]

Yes, but it was also fraud because they weren't supposed to gamble with that money because they were an exchange, not a bank.

[fullsend]

What is different here? FTX bought shitcoins. SVB bought MBS. They gambled rates wouldn’t change and customer’s wouldn’t withdraw.

[morelisp]

Only indirectly; the tide is receding for the first time in many years, and it's exposing a variety of... issues.

[UncleOxidant]

naked swimmers.

[UncleOxidant]

Given the timing one wonders if Silvergate had more impact on SVB. SVB claimed to have minimal crypto exposure, but one wonders what might come out as the FDIC digs deep into their books.

But mostly this was because they bet the farm on long duration bonds just before a period of rising interest rates. It's not like nobody saw that rising rates were on the horizon.

[dehrmann]

I'd say they're unrelated. This situation could hit any US bank that placed the wrong bet. What's somewhat unusual, and might shelter other banks, is the bank run was viral among VC-backed firms. They also had a stronger incentive to withdraw a lot more because their funds weren't insured. A bank with lots of retail customers doesn't have this issue.