In a shocking turn of events, two major U.S. banks, Silicon Valley Bank and Signature Bank, have collapsed. The Federal Reserve quickly took action, and United States President Joe Biden announced that those responsible for the banking mess will be held accountable.
While the cause of the collapse has yet to be fully disclosed, it is believed to be a systemic failure rather than an individual-centric problem. In response to the crisis, the overall confidence in top cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and Binance (BNB) has significantly increased.
Biden’s Commitment to Accountability
President Biden took to Twitter to express his commitment to holding those responsible for the collapse accountable.
“I’m firmly committed to holding those responsible for this mess fully accountable and to continuing our efforts to strengthen oversight and regulation of larger banks so that we are not in this position again,” he wrote.
The Federal Reserve Board and Treasury Secretary Janet Yellen have announced a $25 billion bailout of Silicon Valley Bank and Signature Bank.
The Bigger Picture
The collapse of Silicon Valley Bank and Signature Bank marks the third bank to fail after Silvergate Capital announced voluntary liquidation. The fear of more banks collapsing due to bad debts and non-performing loans has caused a migration en masse to top crypto assets, including Bitcoin and Ethereum. Binance has even converted the remaining $1 billion in Industry Recovery Initiative funds from BUSD to Bitcoin, Ethereum, and BNB.
Criticism of Biden’s Handling of the Bailout
Not everyone is happy with the Biden administration’s handling of the bank bailout. Veteran economist Peter Schiff has criticized the administration for printing more money to save failing banks. He believes that the administration’s lack of commitment to fighting high inflation will only exacerbate the problem.
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