''Fiat money is fragile'' - The collapse of Silicon Valley Bank is causing fears to spread to other major U.S. banks.

Silicon Valley Bank (SVB) was in the spotlight after its collapse prompted the Federal Deposit Insurance Corporation (FDIC) to close the bank Friday. It was the largest U.S. bank collapse since 2008.

Some believe venture capitalists caused the bank failures, while others blame the U.S. Federal Reserve's rate hikes. Economist and gold specialist Peter Schiff said Friday that the U.S. banking system will face more problems in the future. He and several speculators believe these financial institutions hold mountains of long-term Treasury bonds.

Market watchers are predicting a broader financial meltdown in the U.S.

In the past week, two U.S. banking institutions, Silvergate Bank and Silicon Valley Bank (SVB), have collapsed. The SVB collapse was the largest banking collapse since Washington Mutual (Wamu) in 2008, which was blamed for expanding branches too quickly and issuing a huge number of low-quality mortgages to so-called unqualified buyers.

Before its collapse, Wamu held $188.3 billion in deposits, while SVB is estimated to have lost about $175.4 billion in deposits. However, while SVB had $175.4 billion in deposits at the end of December 2022, customers attempted to withdraw $42 billion on Thursday alone. It's safe to say that the collapse of SVB happened much faster than the collapse of Wamu in late 2008.

Other analysts and market watchers blame the illogical inverted yield curve facing long-term and short-term Treasuries today, as well as the U.S. Federal Reserve's rate hikes.

Suna Amhaz, founder and managing partner of Volt Capital, said: "It's no secret that technically most U.S. banks are bankrupt right now because they're all sitting on long-term Treasuries, which are at risk in a 4% interest rate environment."

Peter Schiff expects a much larger financial collapse in the United States. "The U.S. banking system is on the verge of a much bigger collapse than it was in 2008. Banks hold long-term securities at extremely low interest rates. They cannot compete with short-term Treasury bonds. Massive withdrawals by depositors seeking higher yields will lead to a wave of bank failures.

Craft Ventures CEO David Sachs wrote on Twitter, urging Powell to step in and prevent a possible contagion. "Where is Powell? Where is Yellen? Stop this crisis NOW," Sachs tweeted. "Announce that all depositors will be safe. Put SVB in the top 4 banks. Do it before Monday's opening or there will be contagion and the crisis will spread."

Billionaire and Galaxy Digital founder Mike Novogratz also spoke out, expressing surprise that the Fed allowed depositors to lose money to a Silicon Valley bank. "Are all banks going to be treated like hedge funds? Sounds like a political mistake," said Novogratz.