The Run on the Silicon Banks
A coordinated cyber-rumor triggers the simultaneous collapse of the top three tech-focused regional banks in the US.
At 4:00 PM Friday, eerily perfect deepfaked audio of three major tech-bank CEOs admitting complete insolvency goes viral on social media. By 6:00 PM, algorithms and panicked venture capitalists have queued $200 Billion in digital withdrawals—vastly exceeding total FDIC reserves.
You are the Chairman of the Federal Reserve
The Situation Room
>The Treasury Secretary confirms the audio is a deepfake generated by an unknown state actor.
>The FDIC Chair says they do not have enough cash in the Deposit Insurance Fund to cover even a fraction of the uninsured deposits.
>Tech startups across the entire country say they will miss payroll on Monday if the queued transfers fail.
Internal Briefing Notes
• 90% of the deposits in these banks are uninsured (over the $250k FDIC limit).
• Digital banking allows for "infinite-velocity" bank runs, destroying institutions in hours rather than days.
• The Federal Reserve can open the Discount Window, but banks must have adequate collateral to pledge, which these banks lack.
Escalation Window
Reveal each phase to see how the situation deteriorates.
It is Sunday sunset. The markets open in hours. How do you stop the panic?
Choose your response. There are no good options.
You avert the immediate crisis but generate massive moral hazard, implicitly bailing out reckless venture capitalists over a fake rumor.
Allow the market to work. Thousands of small businesses and startups are instantly wiped out, triggering a severe tech recession.
Freeze all digital banking indefinitely under emergency cyber-security protocols. The panic halts, but US financial credibility is deeply scarred.
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