US Senators Demand Answers from SVB’s Clients on $3.3 Billion Deposit
Two United States senators are gathering information on Silicon Valley Bank clients and their large deposits into the failed institution.
US senators, Elizabeth Warren and Alexandria Ocasio-Cortez, have written an open letter to 14 of Silicon Valley Bank’s (SVB) top clients, including Circle and BlockFi, inquiring about the relationship between the bank and its depositors.
The senators are seeking information on the decision-making process behind Circle’s $3.3 billion deposit with SVB and its rationale.
They also want to know whether Circle or its board members had any concerns about holding such a large quantity of non-FDIC insured assets.
SVB’s downfall has raised concerns about its overdependence on tech industry firms and investors, as well as the abnormally high percentage of deposits that were not insured by FDIC.
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Additionally, the role that companies like Circle may have played in precipitating the $42 billion single-day-run on SVB is also a cause for concern.
The senators deem gathering details about these elements vital to develop strategies for averting future collapses. The senators have set a deadline of April 24 for the companies to address their inquiries.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
