Elon Musk, who is, today, the richest man in the world, could be the only one capable of saving Silicon Valley Bank. One of the largest in the entire United States and which is now on the verge of bankruptcy.
In recent days there has been an intense drama with this banking institution that could represent the beginning of serious financial problems, especially if we consider that it is one of the main institutions for financing IT sector ventures.
The idea that Elon Musk could open his wallet to facilitate his bank bailout, at first, sounds like a more than tempting idea.
But just look what the tycoon has done with Twitter as CEO of the platform after buying it to get an idea of how such a “salvation” could turn out.
It is still striking how the news emerged that Musk could intervene in this complicated mess. But to understand it better, it is necessary first to provide a bit of context:
How Elon Musk Considered Buying Silicon Valley Bank
Silicon Valley Bank is an institution that specializes in startups and other corporations supported through a venture capital fund.
This has earned it some reputation and renown in the community, however the bank defaulted on its obligations after a bank run on March 10, 2023 revealed that it lacked sufficient funds to cover even a quarter of the credit it had taken out.
Faced with such a scenario, someone could not help but ask Elon Musk in Twitter if he would buy Silicon Valley Bank and Musk revealed that he has considered it:
Since March 10, Silicon Valley Bank has been absorbed by the Federal Deposit Insurance Corporation (FDIC) and currently his assets are being auctioned little by little to help cover his unpaid debts in the best possible way.
In fact, in a press release on March 12, the US Treasury Department stated that taxpayers will not pay the bank’s bailout bill, which puts the owners of the institution in a greater predicament.
The funds had been frozen after the entry into action of the FDCI and it is only until this Monday, March 13, that account holders will be able to access them.
When this date arrives, a delicate moment will begin where the increase in uncertainty and the possible emergence of more entities with the same level of bankruptcy is a reality.