The reason for the new round of "banking crisis" in the US has been found: the Federal Reserve suddenly changed its regulatory policy!

FX168 Financial News (Asia Pacific) reports that after the collapse of the US crypto-friendly bank Silvergate in 2023, its parent company Silvergate Capital filed for bankruptcy on September 19. The company's CEO, Elaine Hetrick, claimed in the bankruptcy filing that a "sudden change in regulatory policy by the Federal Reserve" was the key reason for the collapse. According to The Block, the 2023 US banking crisis led to the closure of the second, third, and fourth largest banks in the US following the 2008 financial crisis. First Republic Bank, SVB, and Signature Bank all closed. #Silicon Valley Bank collapses# However, the first bank to collapse in the crisis was Silvergate Bank, headquartered in La Jolla, California, which primarily served clients in the digital asset industry, earning it the nickname "crypto bank." In a new bankruptcy filing, executives responsible for liquidating the closed Silvergate Bank holding company argued that despite the contraction of the cryptocurrency industry and rising interest rates, the bank "has stabilized, meets regulatory capital requirements, and has the ability to continue serving customers with deposits at Silvergate Bank." However, in 2023, a "sudden regulatory shift" by institutions such as the Federal Reserve, the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) clearly indicated that starting from the first quarter of 2023, these institutions would not tolerate banks with a large number of digital asset clients, ultimately preventing Silvergate Bank from continuing its digital asset-centric business model. (Source: Stretto) Elaine's bankruptcy filing statement provided a timeline of events leading to the closure of Silvergate Bank on March 8, 2023, two days before Silicon Valley Bank closed and four days before regulatory authorities took over Signature Bank. She noted that serving crypto clients helped the relatively small bank expand its scale, with "deposits increasing from $1.8 billion at the end of 2019 to around $14.3 billion at the end of 2021." By the end of 2021 and the first half of 2022, crypto clients "almost" accounted for all of the bank's non-interest-bearing deposits (i.e., checking accounts) However, in 2022, from Three Arrows Capital to the bankrupt cryptocurrency exchange FTX, the significant collapse of the crypto industry has led to a decrease in deposits, even triggering bank runs. Silvergate was able to cope by selling long-term bond investments at a huge loss. Therefore, bankruptcy filings indicate that Silvergate's consolidated business report shows an annual net loss of $948.7 million as of December 31, 2022, compared to an annual net income of $75.5 million as of December 31, 2021, mainly due to impaired sales of long-term securities caused by rising interest rates. However, the documents mention that despite scaling down to continue operations, the bank still held assets worth more than deposits at the beginning of 2023 and met its regulatory capital requirements. According to the documents, the increased scrutiny by regulatory agencies in early 2023 led to a "turning point" in the bank's business model. It is noteworthy that the Federal Reserve, FDIC, OCC, and other federal banking institutions issued two statements expressing "significant safety and soundness concerns" about the business model of concentrating investments in the cryptocurrency industry, as well as the liquidity risks banks face by primarily serving cryptocurrency-related clients. The pressure from U.S. regulatory agencies on banks serving cryptocurrency clients has been increasing, ultimately forcing Silvergate to consider one of three options: restructuring its business to no longer rely on cryptocurrency clients, selling itself as a going concern, or gradually winding down its operations. The document states that after careful analysis, the bank's management believed that both restructuring the business and selling it were too costly, and announced plans to close the bank on March 8, 2023, making it the first mid-sized bank to do so in 2023. The document states: "Despite unprecedented industry and regulatory pressures, Silvergate Bank did not fail." However, the shift in regulatory pressure will make it impossible to continue conducting business focused on cryptocurrencies, just like the closed Signature Bank, whose closure "illustrated the enormous regulatory pressure the bank faced in the digital asset industry at the time." The cash held by Silvergate's parent company is sufficient to settle multiple lawsuits related to whether Silvergate monitored transactions comply with anti-money laundering procedures, and the bank expects to fully repay bondholders. According to the filing, the company currently holds $1.631 billion in cash and cash equivalents, but is not expected to be able to repay its common stockholders. According to Law360, the bank has also sued a activist investor who tried to secure a seat on the debtor's board to ensure payments to shareholders under a plan that would not yield any returns