The US authorities in charge of the emergency split of Silicon Valley Bank (SVB) Financial Group are reportedly working around the clock to sell assets and make the deposits of uninsured clients accessible as soon as Monday, according to a story published on Bloomberg.
Reimbursement for troubled clients
According to the report, the company’s troublesome clients, many of whom are business owners and their enterprises in the Silicon Valley area, would benefit from the first reimbursement, the timing of which still needs to be determined. Bloomberg cites conversations with unnamed people who claim to have information indicating that the statistics fall between 30 and 50 percent.
On Friday, the State Board of Equalization (SVB) was taken over by the Federal Deposit Insurance Corporation after being closed by the California Department of Financial Protection and Innovation (FDIC). The Federal Deposit Insurance Corporation (FDIC) reportedly assured depositors who had their funds insured that they would have complete access to their funds. Nonetheless, uninsured depositors will get a receivership certificate for the remaining uninsured money, and there is no assurance that these assets will be paid out in full.
Kobeissi’s letter reveals SVB’s crypto ties
Because several crypto firms and exchanges have previously collaborated with Silicon Valley Bank, the recent trend of US banks declaring bankruptcy might have significant repercussions for the cryptocurrency sector. A commentary on the global capital market considered one of the most authoritative in its field, Kobeissi Letter, has recently published a list of companies that have exposures to SVB. The list highlights crypto firms such as Circle, the issuer of the USDC stablecoin, which has $3.3 billion in SVB.
Current List of Companies With Silicon Valley Bank, $SIVB, Deposits:
1. Circle: $3.3 billion
2. Roku: $487 million
3. BlockFi: $227 million
4. Roblox: $150 million
5. Ginkgo Bio: $74 million
6. iRhythm: $55 million
7. Rocket Lab: $38 million
8. Sangamo Therapeutics: $34 million… https://t.co/KD0O5FCq3y
— The Kobeissi Letter (@KobeissiLetter) March 11, 2023
In addition, Silicon Valley Bank was the second biggest lender to crypto start-ups in 2019, precisely behind Silvergate Bank, which is now facing a liquidity issue. Silicon Valley Bank was second only to Silvergate Bank.