The massive amount of customer withdrawals that led to the collapse of Silicon Valley Bank had all the hallmarks of an old-fashioned bank run, but with a new twist befitting the primary industry the bank served: much of it unfolded online.
Customers withdrew $42 billion in a single day last week from Silicon Valley Bank, leaving the bank with $1 billion in negative cash balance, the company said in a regulatory filing.
Founders and CEOs then shared tweets about the concerning situation at the bank in private Slack channels, according to The Wall Street Journal.
House Financial Services Chair Patrick McHenry (seen here in January) described SVB's collapse as driven by "the first Twitter-fueled bank run."
one startup founder told CNN last week, after the bank had collapsed.
“Classic ‘runs on the bank’ hurt our entire system,” he wrote in a lengthy Twitter thread on Thursday.
Hours later, the Biden administration stepped in and guaranteed the bank’s customers would have access to all their money starting Monday. »
