From Tech Hub to Banking Failure: Exploring the Implications of CBDCs on the Destiny of Silicon Valley Bank

Ali, Hassnian and Aysan, Ahmet Faruk and Yousef, Tariq M (2023): From Tech Hub to Banking Failure: Exploring the Implications of CBDCs on the Destiny of Silicon Valley Bank.

Abstract

The potential implications of central bank digital currencies (CBDCs) on Silicon Valley Bank (SVB) are vast, particularly when it comes to oversight of the bank. This paper aims to explore how the introduction of CBDCs could have impacted SVB and its eventual collapse. The introduction of CBDCs has the potential to disrupt traditional banking systems, which could impact the stability of the financial industry. However, CBDCs can also provide real-time monitoring and oversight, which could help to prevent bank failures. This paper examines the potential impact of CBDCs on SVB and how it could have been impacted by the real-time monitoring provided by the Federal Reserve. The findings suggest that the introduction of CBDCs could have helped to prevent the collapse of SVB by allowing for real-time monitoring and oversight. The implications of this research are significant, as it highlights the potential benefits of CBDCs in preventing future banking failures and strengthening financial stability.

• Item Type: MPRA Paper
• Language: English
• Keywords: SVB, CBDCs, Federal Reserve, Digital Bank Run
• Subjects: G - Financial Economics > G2 - Financial Institutions and Services > G28 - Government Policy and Regulation; H - Public Economics > H1 - Structure and Scope of Government > H12 - Crisis Management; O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights > O32 - Management of Technological Innovation and R&D

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