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Banks Starting with “Si…” Please Step Forward

As Sync went to press last week, the TradFi world had a whiplash-inducing weekend, with Silicon Valley Bank, Signature Bank, and Silvergate imploding in what some observers — prioritizing rhetorical effect over accuracy — approached as an event on par with the crisis of 2008. Where the crypto ecosystem intersected with those troubled entities, fiery discussions of philosophy, policy, and culpability ensued. 

Exercising my “Editor’s Prerogative,” I pause here to add that neither Bloq nor any of its projects had banked with any of those entities. 

Invoking that same prerogative, we will today focus on surfacing a richness of perspectives that one can uniquely get from Bloq. Below, here are the insights from the builders and leaders within our DeFi, NFT, metaverse, infrastructure, and mining projects. 

I leave you with a quote from Milton Friedman, the late monetarist who would most certainly have delivered powerful observations in the current moment:

Only a crisis — actual or perceived — produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes the politically inevitable.

With that in mind, I pass the mic to my colleagues.

– Phil Gomes, Chief Communications & Marketing Officer, Bloq, Inc.


“One can only hope the collapse of SVB, Signature, and Silvergate (S3) forces an entire reexamination of the fractional reserve banking (FRB) model. As Professor Stam observed, runs in the social media age happen at breakneck speed, and no FRB is sufficiently capitalized. Caitlin Long’s Custodia Bank, however, was the first real innovation and departure from FRB in decades. Its Federal Reserve membership application was denied. To restate plainly: TradFi elites rejected innovation that might have prevented the next SVB collapse. 

“Let’s review what crypto got right when reasoning from first principles — centralized entities fail, not protocols. The instinctual negative reaction to money printer go brrr turns out to be a saving crypto ethos. And though we’re right back to mortgage-backed-securities-related bank implosions and rapidly deflating long assets, thanks to monetary policy we know brrr will have massive unintended consequences. Even more fundamentally, crypto in aggregate exists as a check-and-balance alternative in the open market of currencies and ideas. This is both subtle and powerful. Even those who never touch crypto benefit from crypto-driven fiat improvements.”

Jeff Garzik, CEO & Co-Founder, Bloq, Inc.


“’Bitcoin: A Peer-to-Peer Electronic Cash System by Satoshi Nakamoto.’ It’s a simple title but a profound declaration of freedom and sovereignty. Satoshi released his whitepaper for moments like these and to this day it serves as our ‘Crypto Declaration of Independence.’ Battles will continue to be waged against crypto friendly banks, companies, and institutions. They will be made ‘examples’ of and the markets will respond in kind. But protocols do not care and good protocols cannot be manipulated.”

Ryan Condron, Project Leader, Lumerin


“Anyone who has been in the cryptocurrency space long enough remembers when banks absolutely would not speak to us. If you wanted to start a business based around cryptocurrency (which was just Bitcoin for the most part then), you either needed to have an existing relationship with a bank — and hope no one noticed — or had to do without. These days, I have a credit card that spends USDC. So while it is great that we can work with banks directly now — with some perhaps glaring exceptions — the industry grew up in a space without them. This instinct will be essential to our ecosystem’s next evolutionary stage.” 

John C. Vernaleo, Ph.D., VP of Engineering, Bloq, Inc. 


“No one had ‘USDC depegging’ and the resulting domino effect on their bingo cards. This stablecoin volatility triggered emergency procedures across DeFi protocols, with many pausing or adjusting as needed. For our part, the Vesper and Metronome teams called an emergency all-hands meeting, acted promptly, and did not experience any negative impacts as a result of the unexpected volatility. It was a welcome relief when the stablecoins returned to peg within 48 hours. It can now be said that Vesper and Metronome are products that were built for — and have proven themselves in — all market conditions.”

Jordan Kruger, Head of DeFi, Bloq, Inc., CEO Vesper Finance and Metronome


“Considering the fall of SVB, Signature, and Silvergate, users are flocking to store their money in a trusted location. Further, the reason why bank assets have to be insured is because of bank’s tendency to loan out user’s deposits for a profit. Overcollateralization of assets, when not properly backed, leads to disaster. One of the reasons why we built CapsuleNFT was to have backing as part of the experience. Just as crypto and DeFi seek to absorb financial operations like borrowing and lending into the protocol layer, so too do we believe that trustless backing of assets can be part of the plumbing as well.” 

Daniel Peter, CEO, CapsuleNFT


“Ironically, the banks that we so distrust are the last layer of perceived privacy between us and the regulatory bodies, and it is only the slowness of their technological advance which has prevented a more complete ‘Big Brother.’ The notion of a Central Bank Digital Currency (commonly called a CBDC) is the last domino in the set. No Bill of Rights can protect you when your finances could be garnished for nonconformity. The ‘acquisition’ by the state of three of the most ‘blockchain-friendly’ banks, including Signature Bank — which allegedly owned proprietary technology for facilitating transactions with blockchain based assets — is more than just a shot across the bow for any industry championing financial freedom.”

Kevin Beauregard, CEO, Atmos Labs

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