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Comment by rvz | Hacker News Reader

Oh dear. It guess this is how the VC pyramid scheme collapses. $151BN uninsured deposits in the bank. [0]

Now all those unprofitable startups will be falling like dominoes as now the money is tied up in the bank with withdrawals disabled.

[0] https://twitter.com/FedGuy12/status/1634038788468113408

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That amount of confidence on the fact that the music would never stop is... I dunno, I don't get any good adjectives. I can't understand it.

It's not even the case that they did it for the returns, because the returns were negative. Is it a regulation thing that forced banks to overinvest in long-term bounds?

You're getting downvoted because people are upset, but this is a real problem that could have been avoided. We'll come out of it stronger, but its going to hurt.

Many people will not come out of this stronger.

Does this mean that SVB customers are going to lose deposits over the FDIC limit (250k?)

For now yes, you get a note on what’s owed that remains and in time you get some of your money back post bankruptcy.

Keep your accounts lower than 250k

Or better yet, don't listen to your VC's relationship people and put all of your money in one bank.

Many bank's terms are if you get a loan from them, you need to use them as your only bank (or only accounts receiving deposits, or something). It is negotiable but it is the norm.

> Keep your accounts lower than 250k

For full precision, if you're concerned about this, be aware that it's 250K per depositor at a given bank, rather than per account. That is, all your qualifying accounts at the bank are considered as one pool and 250K of that is insured. More detailed information, including how joint accounts are handled, here: https://www.fdic.gov/resources/deposit-insurance/financial-p...

No because SVB has assets with value to sell. That's the "dividend" the FDIC refers to in the press release.

SVB's assets will be divided up and given back to creditors (including depositors). So remaining depositors likely will get something back eventually, but we don't know how much yet (10%? 50%? 85%). There will also likely be a delay in getting those funds back as the process plays out, which is probably more dangerous to many companies than the haircut (assuming the hair-cut isn't too severe).

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