Silicon Valley Bank’s crisis and subsequent closure has rocked financial markets since late last week. In a bid to protect depositors and investors, federal regulators announced Sunday that they would “address any liquidity pressures that may arise.”
Many people have described the emergency measures as a bailout and say that they mark a major shift in how the federal government deals with banking crises. Until now, only deposits up to $250,000 were insured under federal law. But the Sunday decision by regulators will protect all deposits made at SVB and crypto-heavy Signature Bank, which regulators wound down on Sunday, to avoid “systemic risk.”
Prarthana Prakash | Fortune.com