Biden vows to punish those responsible for the collapse of SVB and Signature
President of the United States Joe Biden tweeted that he is “firmly committed” to holding those responsible for the collapse of Silicon Valley Bank and Signature Bank “fully accountable.”
Joe Biden, the vice president of the United States, has pledged to hold accountable those responsible for the collapse of Silicon Valley Bank and Signature Bank, while assuring Americans that their deposits are secure.
Signature Bank was acquired by the New York District of Financial Services on March 12. The Federal Reserve stated that the crypto-friendly bank was shut down to safeguard the U.S. economy and boost public confidence in the banking system.
In addition, the Fed announced a $25 million fund to support banks that may face liquidity issues in the future.
On March 13, Vice President Joe Biden tweeted to his 29.9 million followers that he was pleased that the agencies had “reached a solution that protects workers, small businesses, taxpayers, and our financial system.”
At my direction, @SecYellen and my National Economic Council Director worked with banking regulators to address problems at Silicon Valley Bank and Signature Bank.
I’m pleased they reached a solution that protects workers, small businesses, taxpayers, and our financial system. https://t.co/CxcdvLVP6l
— President Biden (@POTUS) March 13, 2023
The president added that he was “firmly committed” to holding those accountable for the mess to “full accountability.” He added that he would “have more to say” on March 13 in a speech.
In the meantime, a multitude of other United States politicians have praised the recent actions of federal regulators to prevent the spread of the recent banking collapses.
According to a March 12 statement by the U.S. Senate Banking and Housing Committee, U.S. Senator Sherrod Brown and Representative Maxine Waters were also pleased that both insured and uninsured SVB depositors would be covered.
“Today’s actions will enable workers to receive their paychecks and for small businesses to survive, while providing depository institutions with more liquidity options to weather the storm.”
“We urge financial regulators to ensure that the banking system remains stable, strong, and resilient, and that depositors’ funds are safe while we work to better understand all of the factors that contributed to the events of the past few days and how to strengthen guardrails for the largest banks,” the statement continued.
Silicon Valley Bank depositors, both insured & uninsured, will be made whole by the plan from the FDIC, the Federal Reserve, the Treasury & the White House. And the Fed has created a new facility to support all banks that need liquidity to ensure our banking system is safe.
— Maxine Waters (@RepMaxineWaters) March 13, 2023
Gary Gensler, chairman of the U.S. Securities and Exchange Commission, has seized the opportunity to intensify his agency’s pursuit of wrongdoers, without naming any specific industries.
In a statement released on March 12, the SEC chairman reaffirmed that the agency would be on the lookout for violators of U.S. securities laws.
“In times of increased volatility and uncertainty, we at the SEC are particularly focused on monitoring for market stability and identifying and prosecuting any form of misconduct that might threaten investors, capital formation, or the markets more broadly.”
The SEC chairman added, “We will investigate and bring enforcement actions if we find violations of federal securities laws without speaking to any individual entity or person.”
The temporary devaluation of Circle’s USD Coin to as low as $0.88 on March 11 was precipitated by the shutdown of SVB, which held $3.3 billion of Circle’s $40 billion USDC reserves.
Nevertheless, USDC is almost back to $1 after the Federal Reserve confirmed that all customer deposits at Signature Bank and SVB will be made “whole.”
Silvergate Bank, another prominent cryptocurrency bank, announced last week that it would close and liquidate voluntarily “in light of recent industry and regulatory developments.”
Shortly thereafter, on March 9, Gensler penned an opinion piece for The Hill in which he warned U.S. crypto companies to “operate within the confines of the law” or face enforcement action.
As Chair of @SECGov, I have one goal with regard to the crypto markets: to ensure that investors and the markets receive all the protections that they would in any other securities market. How?
Read my op-ed in @thehill:
— Gary Gensler (@GaryGensler) March 9, 2023