Weekly Newsletter #7

The NEXT Lehman? A repeat of 1929? Silvergate AND SVB goes down ⬇️

Author

Run The Chain
March 10, 2023

Newsletter #7

GM/GN, bear 🐻 market is FULLY back 😭 We're seeing bank runs and prices dropping like stones. Hopefully everyone's been doing well and holding up. Grab your Joes ☕️ and milk 🥛, and let’s get to this week's news! 👇

TOPICS OF THE WEEK

RIP.

  • Market Analysis

  • News of the Week

  • Other Headlines

  • 🤑 Funding 🤑

  • Meme of the Week

DATA YOU SHOULD CARE ABOUT

Job report came out STRONG, with even Biden announcing that the US economy added 311,000 jobs last month. This is all done while maintaining a low unemployment rate - but could this strength continue? #BidenBoom

Millions of dollars have been moving around lately. Many whales have been moving their funds to exchanges - presumably dumping. The best example of this can be seen with the Amber Group. 

NEWS OF THE WEEK

Silvergate and Silicon Valley Bank go UNDER 💀

Things were not great this week. It was a tough week for both crypto and traditional markets. Crypto's on-ramp and off-ramp bank has officially declared "voluntary liquidation". Since questions loomed with its 10-k, the bank has faced many problems. The crypto industry clearly faced the issues, too, with FUD on the US government selling BTC, Bitcoin whales withdrawing and dumping, Binance insolvency FUD, FED FUD, MT GOX FUD, and Kucoin Lawsuit. 

Silvergate was 1 of 2 major TradFi players that could move money in and out of the crypto market. Its clients included the likes of Kraken, Coinbase, Gemini, and more. Without this crucial bridge, the industry has taken another step back. 

  • Exchange liquidity will fall drastically because of Silvergate's downfall

  • Digital asset inflow will decrease

  • Mass adoption is going to have to wait

However, this opens up the space for our industry players to step in. Kraken recently announced that they will be launching a Kraken bank. 

So for now, if customers want to on-ramp/off-ramp they will have to turn to less regulated options posing a danger for users. We'll have to see how things play out...

The “crypto bank” wasn't the only bank to fall this week. Silicon Valley Bank is also going under. In just the past two days, U,S. banks have lost OVER $100 billion in stock value, and European banks have lost $50 billion in value. Let's just say the financial sector is not looking great, and it looks like 1929 again…bankrun!

SVB’s fall would result in a cascading downfall for the startup world. With billions of dollars in venture debt, this will be the Lehman moment for startups. The main reason for this is the extreme illiquid investments that they’ve made.

It looks like we're going bankless faster than we thought.

Going to be tough days ahead.

On a side note, some sus activity 🧐 going on with the CEO of $SVIB. He sold stocks in the last two weeks before the bank’s collapse. Coincidence? 

USDC’s issuer, Circle, has also expressed exposure to SVB. It’s not a small amount, either.

OTHER HEADLINES

$FUNDING$

MEME OF THE WEEK

So what stage are we at now?

Aand that wraps it up for our newsletter! Hope you enjoyed the news, memes and analysis. See you next week!

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.