Responding to a Financial Crisis with Jason Brett - WBD617

Jason Brett is a former FDIC regulator who worked through the
2008 Global Financial Crisis. In this interview, we discuss the
events that led up to the 2008 GFC, the implosion of IndyMac
& subsequent bank-run and what to expect from regulators
following the crypto contagion of 2022.


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In 2008, the Global Financial Crisis brought the economic world
to its knees. The crisis was triggered by a combination of
factors, including the subprime mortgage crisis, the failure of
large financial institutions, and some outright systemic
corruption. One of the most notable events during the GFC was the
bank run on IndyMac, an institution that failed due to a lack of
confidence among its depositors. This event was a clear sign that
the financial system was in trouble, leading to calls for greater
banking industry regulation.


In response to the GFC, governments around the world implemented
a range of regulations. These included increased capital
requirements, restrictions on risky lending practices, and
increased scrutiny of financial institutions. These regulations
aimed to make the financial system more robust and reduce the
risk of another crisis.


It's easy to draw parallels to the ‘crypto’ market in 2022. Luna,
3AC, Celcius and FTX all failed because of their lack of adequate
risk management, sketchy lending practices, and some out-and-out
fraud. Calling into question concerns about the stability and
legitimacy of the crypto industry and, unfortunately, dragging
bitcoin into this discussion.


While we may see Bitcoin as totally separate to 'crypto',
lawmakers and decision-makers do not, and in the fallout from the
crypto contagion, we may see draconian regulations impact us
going forwards. So what can we learn from the GFC in 2008, and
the regulation that may affect us in 2023?