Well of course if we consider only those where loss actually happened and not those where the losses have been mutualized by bail-outs, it may not be gigantic. But, I don't know, in Cyprus hair cuts made $8 bn of customers deposits vanish.
That's just one I know from the top of my head without needing to google.
I think the difference must be many orders of magnitude to the benefit of regulated banks.
“Silicon Valley Bank is no more. It’s the first bank backed by the Federal Deposit Insurance Corp. to fail since 2020.”
https://www.marketplace.org/2023/03/10/how-silicon-valley-ba...
.. at some point, we're gonna have to step back and take a look at how we're doing business. Something about our whole way of organizing society is busted.
https://www.fdic.gov/bank/historical/bank/
Finance is inherently an opportunist, if not outright criminal, industry which explodes regularly causing huge economic and political damage.
And, of those 562, in how many of them did the depositors lose money?
The thing is failed banks don’t mean depositors lose all their money. The point of banking regulation is fail fast so banks are taken out when they still have 98% of their depositors money not 8%. People with under 250k are made whole and people above that have already been compensated for their risk by higher interest rates.
It doesn’t always work perfectly, but in many cases a failed bank just means people come in on Monday and there is a new sign on the building with little else changed.
In gross terms, crypto is tiny compared to the dollar/euro banking system, so it's likely to be a much smaller number.
Interestingly, for those who use crypto as-designed, the percentage lost to bank runs is almost nil since you 'hold your own coins'. It's people who leave their money on crypto exchanges that lose their coins.
The vast majority of traditional currencies have lost nearly all of their value over time, including the US dollar.
People who hold their own coins lose them as well. It was estimated that 3.7 million bitcoin have been already lost irreversibly [1]. That's a staggering number. It's roughly 20% of the entire supply.
[1] https://blog.chainalysis.com/reports/bitcoin-market-data-exc...
I don't see why I should take this seriously.
On the other hand, the keys to my ethereum remain safe on my hardware wallet, and none of my ethereum has ever moved without me telling it to. Perhaps my experience is atypical, but I am surely not alone.
These options are not currently available to cryptocurrencies, but that's a social choice.
I tend to think that the scamming aspect of cryptocurrencies is massively overstated. There are lots of ways to be taken in and scammed, but that's true in the fiat world too. A small amount of care goes a long way in both worlds.
And don't fall back on 'they were bailed out'. They were bailed out by other banks buying their assets + liabilities, and by the insurance payments they were making. They weren't getting a blank check from the treasury. That's the system working.
Who bailed out the crypto losses? Some of the losers got made whole, but many, many, many are realized losses.
What crypto losses you're talking about? The ones from centralized custody operators that hold your money in arbitrary way rendering your balance on web page in crypto currency or something else?
But SVB is a much bigger bank with a much larger share of uninsured deposits than a typical bank failure. If the problem extends beyond liquidity and really is an insufficiency of assets by any significant share, its going to be hard for a no-loss takeover to be facilitated.
And stop acting like any uninsured money evaporates in a bank failure.
Actually probably just stop talking about banks. This whole thread is an embarrassment of “smart people with strong opinions about things they have zero knowledge about”.
I wonder how this situation looks outside of US in more distressed economies ie. Argentina.
This is wrong for two reasons:
(1) The insurance limit applies per owner per ownership class; its possible to have accounts in more than one ownership class, and thus more than $250k insured.
(2) Recovery of the insured amount is guaranteed by the full faith and credit of the US government. Recovery of additional amounts is possible, and FDIC will make an effort to make it happen, but that's no guarantee.
Is that true? I'm not sure it is. The U.S. government gave hundreds of billions of dollars direct to banks and other institutions. The total actual cost has been estimated to be around $500 billion, despite claims that the loaned money was all paid back.
https://en.wikipedia.org/wiki/Emergency_Economic_Stabilizati...
https://mitsloan.mit.edu/ideas-made-to-matter/heres-how-much...
As I already mentioned and from the paper's abstract:
> Those conclusions stand in sharp contrast to popular accounts that claim there was no cost because the money was repaid, and with claims of costs in the multiple trillions of dollars.
So to be clear, the paper claims there was still a cost of $500 billion even though money was paid back.
https://gcfp.mit.edu/wp-content/uploads/2019/02/BailoutsARFE...
Seriously, it was a childish and overly dramatic comment. Stop digging.
Ah, so less than 1 FTX?