WCL Professors Featured in Media Coverage of Crypto Bank Failures
Writing for , Professor Comizio noted that while 鈥済overnment regulators rushed in to guarantee deposits and protect bank customers鈥 of Silicon Valley Bank (SVB) and Signature Bank, 鈥渢here was no obligation for the government to step in鈥 under current banking regulations. He noted that 鈥淸w]hile some aspects of each failure were different, there were common elements, and a certain level of Murphy鈥檚 law 鈥 the idea that if something can go wrong, it will. In the case of these banks, everything went wrong.鈥 Professor Comizio also told the that 鈥淸t]he common theme here is regulators are not paying attention to banks related to crypto and private equity, and the question is: why didn鈥檛 the regulators step in?鈥
Additionally, Professor Allen observed that in cases where a failed bank cannot be sold in receivership, the FDIC sometimes must create a 鈥渂ridge bank鈥 to help the firm continue to operate and find an acquired later. Professor Allen was noted in the as saying Silvergate鈥檚 collapse could 鈥減ut even more pressure on banks to demonstrate that their dealings with crypto are safe and sound.鈥