Viewpoint: The failure of three banks, including Silicon Valley Bank, may limit the liquidity of the encryption industry

On March 13, Nic Carter, founder of Castle Island Ventures, a digital asset company, said that the government’s willingness to provide support for the Silicon Valley Bank and Signature meant that it had returned to the mode of providing liquidity rather than tightening, and the loose monetary policy had proved to be the “gospel” of cryptocurrency and other speculative asset classes in history, but this instability once again showed the vulnerability of the stable currency, Unusual financial conditions may cause them to fall below their fixed value. It is reported that Signature and Silvergate are the two main cooperative banks of encryption companies, and nearly half of American venture capital backed startups deposit cash in Silicon Valley banks, including crypto-friendly venture capital funds and some digital asset companies.

Interpretation of this information:

On March 13, Nic Carter, founder of Castle Island Ventures, made a statement regarding the government’s recent willingness to provide support for banks such as Silicon Valley Bank and Signature. Carter posits that this indicates a return to a mode of providing liquidity rather than tightening, with loose monetary policies proving to be the “gospel” of cryptocurrency and other speculative asset classes throughout history.

However, Carter warns of the vulnerability of stable currencies, stating that unusual financial conditions may cause them to fall below their fixed value. This instability once again highlights the unpredictability of the market and shows that traditional financial models may not always apply to digital assets.

Signature and Silvergate are two of the primary banks that cooperate with the cryptocurrency industry, with nearly half of American venture-backed startups depositing cash in Silicon Valley banks. This trend indicates a growing acceptance and incorporation of digital assets into traditional financial systems.

In summary, the three keywords in this message are: liquidity, instability, and cooperation. The current government support for banks implies a focus on liquidity rather than tightening, which has historically been favorable for cryptocurrency and other speculative assets. However, this instability highlights the vulnerability of stable currencies and the unpredictability of the market. Cooperation between traditional financial institutions and digital asset companies is becoming increasingly common and represents a growing acceptance of these assets into mainstream financial systems.