It had all the hallmarks of a classic bank run, but with a new twist befitting the major sector the bank served: a large chunk of it took place online. This new twist was apropos of the fact that the principal sector the bank served was the financial industry. Given that the internet was the principal industry that the bank catered to, this novel turn of events was very appropriate.
It is quite likely that at least some of the sudden withdrawals were prompted in part by a viral fear that propagated across social media platforms and, according to accounts, in private chat groups. This is a highly plausible explanation for at least some of the unexpected withdrawals. The use of digital banking made it feasible for the surprising transactions to be completed in such a lightning-fast manner. The panic immediately spread across a number of different social media sites as well as in private online discussion groups.
In view of the fact that the internet was the most important industry that the bank helped to support, this novel approach was entirely suitable. A typical bank run was ultimately responsible for Silicon Valley Bank’s demise. This run was caused by a huge number of customers pulling their money out of the bank all at once, which led to the bank’s failure. A classic bank robbery was what set off this chain of events.
Customers of Silicon Valley Bank withdrew a total of $42 billion in a single day the week prior, causing the bank to finish the day with a negative cash position of $1 billion, as reported by the firm in a file with the regulatory authorities. This information was provided by the bank to the regulatory authorities. The bank communicated this information to the governing bodies that oversee financial institutions.