The creator of TRON and the adviser for Huobi, Justin Sun, has offered a helping hand to anyone developing a dependable bank that can “cater to the needs” of the crypto ecosystem. He noted that a reliable bank is crucial for enabling crypto adoption on a wider scale.
Who is Justin Sun?
Justin Sun is the 32-year-old founder of the TRON foundation and an adviser for Huobi Global. He and the TRON network have made a huge impact on the industry.
Last month, Sun announced a payment system utilizing both TRON and ChatGPT. Shortly after, TRON disclosed a $100 million fund to support artificial intelligence.
Sun’s Concern for the Crypto Industry
Sun highlighted the potential harm of the recent collapse of the Silicon Valley Bank to the industry. Hence, he disclosed that he is willing to work with anyone creating “a robust banking infrastructure that bridges traditional finance and crypto”. He expressed that such a bank can be built locally or internationally.
The Collapse of the Silicon Valley Bank
Established almost half a century ago, SVB is one of the biggest banks in the United States. Before its fall, SVB was the 16th largest banking institution in America. What could have led to the demise of such a reputable institution?
During the pandemic, people splurged on gadgets and virtual services. Naturally, banks witnessed an influx of deposits, and the Silicon Valley Bank was no exception. As a result of this, the bank made huge investments with the deposits.
The root of the collapse might have been when SVB purchased huge amounts of long-dated US government bonds. When interest rates rise, the prices of these bonds start to fall. Hence, when the Federal Reserve began to rapidly increase interest rates to tackle inflation, SVB’s bonds started to lose a lot of value.
Customers started withdrawing their money because of bad economic conditions. To meet the new demand, SVB had to let go of some of its bonds at ridiculous prices and could not regain its investment. This move scared its customers and investors, and the bank collapsed just 48 hours after it had announced the sale of some of its assets.
The Silicon Valley Bank was notable for catering to the needs of Silicon Valley. The bank provided support to startups and tech companies that traditional banking institutions could not provide. Now, these tech firms and startups are left vulnerable with the fall of the Silicon Valley Bank.