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At its core, Bitcoin is a transaction database. Every 10 minutes, a new collection of such transactions, called a block, is queued up on Bitcoin, immutable for all eternity. Satoshi Nakamoto, the mysterious mastermind behind the first and most popular cryptocurrency, created that first transaction block themself. But Bitcoin is also a political project — at least, the idea behind it was and always will be political. Nakamoto inserted a message into the code that still forms the start of the decentralized Bitcoin database: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.” This political message is as relevant these days as it was in early 2009 when a global financial crisis seethed anger and enraged people worldwide. The banks whose recklessness caused this crisis were not punished, but rewarded with taxpayer money. Governments have claimed since then to have learned their lesson.

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Credit Suisse is taking decisive action to pre-emptively strengthen its liquidity by intending to exercise its option to borrow from the Swiss National Bank (SNB) up to CHF 50 billion under a Covered Loan Facility as well as a short-term liquidity facility, which are fully collateralized by high quality assets. This additional liquidity would support Credit Suisse’s core businesses and clients as Credit Suisse takes the necessary steps to create a simpler and more focused bank built around client needs. That said don't hold your breath for some breathtaking surge: once the market sees though this rescue for what it is - yet another temporary stop gap measure - it will demand much more, especially after the ECB hikes rates which this "band-aid bailout" will allow the Central Bank to do, in the process guaranteeing an even bigger bailout down the line.

El Salvador’s Bitcoin Office has announced a new six month educational program entitled “CUBO+” that aims to produce elite-level Bitcoin and Lighting developers through the Salvadoran university system. The program, beginning in May, will consist of a relatively small group of students, under 25, narrowed down from some of the brightest students in El Salvador’s universities. The program will be led and taught by some of the brightest minds in Bitcoin who will be announced soon. Classes will range in topics from high-level technical development specific to Bitcoin, to distributed technologies such as Holepunch, Nostr and Web5. The first two months of the program will be online, followed by a two week in-person bootcamp, featuring intense full-day courses located in San Salvador. The remaining months will include close online mentorship with the top names in Bitcoin. Students who complete the course will be presented with various options for continuing their Bitcoin journey, including the option to take on a full-time job at reputable Bitcoin companies. Otherwise, entrepreneurial opportunities and continuing education will be available.

Market observers are on alert to find out just how much extra funding the Federal Reserve’s new bank backstop program will ultimately add into the system, with analysts at JPMorgan Chase & Co. positing that it could inject anywhere up to $2 trillion in liquidity. The Bank Term Funding Program should be able to inject enough reserves into the banking system to reduce reserve scarcity and reverse the tightening that has taken place over the past year, the JPMorgan strategists wrote.

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"... why did they react so harshly to what they said was our inability to give them the sufficient data? I believe it was probably to send the message that even though we were doing crypto stuff responsibly, they don’t want banks doing crypto. They denied that in their statement, but I don’t fully believe that. I think that they overreacted to what they saw was our problem with data, which may well have existed, but the data was improving. I think sloppy data is not a reason to close a bank that you have not decided was insolvent, and they’ve never said we were insolvent."

The fundamental lesson we have to relearn is that even in a modest crisis deposits cannot be sacrificed, and rules on haircuts for provision of liquidity will go out of the window. Banks are wards of the state partly because they are at the heart of the credit system, but even more because their deposit liabilities are so politically important. The marriage of risky and often illiquid assets with liabilities that have to be safe and liquid within undercapitalised, profit-seeking and bonus-paying institutions regulated by politically subservient and often incompetent public sectors is a calamity waiting to happen.

In its downgrade of the entire sector, the rating agency noted the extraordinary actions taken to shore up impacted banks. But it said other institutions with unrealized losses or uninsured depositors still could be at risk. The Federal Reserve established a facility to ensure that institutions hit with liquidity problems would have access to cash. The Treasury Department backstopped the program with $25 billion in funds and vowed that depositors with more than $250,000 at SVB and Signature would have full access to their funds. But Moody’s said that concerns remain. The firm said it expects the U.S. economy to fall into recession later this year, further pressuring the industry.

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Following generations of taxpayer support and government involvement, politicians, regulators, and lobbyists have supplanted the market in determining what counts as capital, how it is calculated, and how much is enough. This artificial mechanism has resulted in a decline of both the level and quality of capital among the world’s largest banks. As the regulators have supplanted the market in setting bank capital standards, they increasingly rely on ever more arcane and complicated methods to determine how much capital a bank should hold. They assign risk weighs to the different asset categories held by banks. In contrast, the absence of the largest banks having sufficient equity capital as they entered the Great Recession, required governments to infuse public funds into many of them. It will be at significant public cost if that lesson must be relearned should bank capital weaken.

Following the failure of Silicon Valley Bank — the biggest bank bust since the dark days of 2008 — and with Monday’s closure of Signature Bank, bitcoin has surged nearly 20% in the past 24 hours. While traditional banks struggle to maintain the trust of their customers, bitcoin’s decentralized system is suddenly looking at least a little appealing. As Satoshi Nakamoto, bitcoin’s enigmatic creator, once put it, “The root problem with conventional currency is all the trust that’s required to make it work." Well, turns out bitcoin’s trustless system has its own allure.

The way the banking system works is, essentially, banks take your deposits and lend them out at higher interest rates than they pay you. They often keep reserves in U.S. treasury bonds, among other things, and everything seems to work until it doesn’t. Regional banks will bear the brunt of this hit, as demonstrated by the recent collapse of SVB. Federal regulators are desperately trying to prop up confidence in the system by backing 100% of depositors’ money, but at what cost? The scenario playing out before us is a stark illustration of what happens when trust starts to break down in a system fundamentally based on the idea of trusting, rather than verifying. Bitcoin is fundamentally different. You can eliminate reserve requirements, duration and interest rate risks, counterparty risks and the like. There is no trust in Bitcoin. There is only code.

Because only the first $250,000 of each deposit at a U.S. bank is insured by the Federal Deposit Insurance Corporation (FDIC), last week's collapse of SVB sparked concerns that its small-business clients would be unable to pay employees. Some 89% of around $200 billion in deposits held by SVB at the end of 2022 was uninsured, according to the FDIC. Regulators have now removed that risk. But in doing so "they took another step towards demonstrating that they are unwilling to allow free markets to sort themselves out," said Toronto-based independent proprietary trader Kevin Muir. Some analysts said the U.S. actions were not a bailout, because shareholders and unsecured debtholders of SVB would not be covered.

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Isaac led the FDIC in the early 1980s amid widespread bank failures and high interest rates. In a Politico article published Sunday, he said of the SVB failure, “There’s no doubt in my mind: There’s going to be more. How many more? I don’t know. How big? I don’t know. Seems to me to be a lot like the 1980s.” On Saturday, the FDIC asked officials at small and midsize lenders, including First Republic Bank, about their financial situations, Bloomberg reported. They also reportedly discussed setting up a new special vehicle to reassure depositors—and help contain any panic.

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Federal regulators announced that depositors of Silicon Valley Bank will be paid in full In a statement released Sunday, the Treasury, Federal Reserve and the FDIC said they would "fully protect" depositors with funds in the bank. SVB was shut down Friday afternoon after a stock price crash, leaving customers panicking. The government statement issued on Sunday stated that "Shareholders and certain unsecured debtholders will not be protected. Senior management has also been removed. Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law."

Regulators have closed down crypto-friendly lender Signature Bank in an attempt to stave off a banking crisis. The Federal Reserve, Federal Deposit Insurance Corporation (FDIC) and U.S. Treasury announced the New York-based bank’s closure under a “systemic risk exception” Sunday (March 12) evening, two days after the collapse of Silicon Valley Bank. According to the statement, Signature Bank was closed Sunday by the New York Department of Financial Services (NYDFS), which turned over control to the FDIC. “All depositors of this institution will be made whole. As with the resolution of Silicon Valley Bank, no losses will be borne by the taxpayer,” the statement said. “Shareholders and certain unsecured debtholders will not be protected. Senior management has also been removed. Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.” Signature Bank had about $110.36 billion in assets and total deposits of about $88.59 billion as of the end of 2022, NYDFS said Sunday.

One unique aspect of SVB was its decades-long focus on the venture capital industry. The bank’s loan growth had been slowing as interest rates rose. Meanwhile, when announcing its $21 billion dollars in securities sales on Thursday, SVB said it had taken the action not only to lower its interest-rate risk, but because “client cash burn has remained elevated and increased further in February, resulting in lower deposits than forecasted.” SVB estimated it would book a $1.8 billion loss on the securities sale and said it would raise $2.25 billion in capital through two offerings of new shares and a convertible bond offering. That offering wasn’t completed. So this appears to be an example of what can go wrong with a bank focused on a particular industry. The combination of a balance sheet heavy with securities and relatively light on loans, in a rising-rate environment in which bond prices have declined and in which depositors specific to that industry are themselves suffering from a decline in cash, led to a liquidity problem.

BOLT, which stands for "Basis of Lightning Technology", refers to a set of technical specifications or protocols that define the rules and procedures for how the Lightning Network should operate. BOLT was first introduced in 2017 by a group of developers working on the Lightning Network, and since then, it has undergone several updates and revisions. The protocols are open source and available to anyone who wants to use or develop Lightning-related applications and services. There are several layers to BOLT, each of which defines a specific set of rules and protocols. Overall, BOLT provides a comprehensive specification for the Lightning Network, allowing different implementations to interoperate with each other seamlessly.

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prominent blockchain venture capitalists (VCs) have over $6 billion worth of assets held by the now-defunct financial entity. These include $2.85 billion from Andreessen Horowitz (a16z), $1.72 billion from Paradigm and $560 million from Pantera Capital. A16z currently holds active investments in projects such as Alchemy, Sky Mavis and Yuga Labs, and was previously an investor in cryptocurrency exchange Coinbase. Paradigm has invested in projects such as Compound, Cosmos and Uniswap. Meanwhile, Pantera Capital holds stakes in projects such as 1inch, Ankr and Zcash.