# Bank Run

*Macro & Economy — Finicade finance glossary*

A bank run is depositors withdrawing en masse because they fear others will withdraw first — a fear that is self-fulfilling, since no bank holds that much cash.

A bank run is depositors withdrawing en masse because they fear others will withdraw first, which makes the fear self-fulfilling: no solvent bank holds enough cash to repay everyone at once. It's the classic multiple-equilibrium problem — both 'everyone stays' and 'everyone runs' are stable. Deposit insurance was invented to eliminate the bad equilibrium, and Silicon Valley Bank in 2023 showed how much faster a run moves when the withdrawals are digital and the deposits uninsured.

**Also known as:** run on the bank, deposit flight, bank panic

**Related terms:** [Liquidity Risk](https://finicade.com/glossary/liquidity-risk), [Deposit Insurance](https://finicade.com/glossary/deposit-insurance), [Discount Window](https://finicade.com/glossary/discount-window), [Nash Equilibrium](https://finicade.com/glossary/nash-equilibrium), [Systemic Risk](https://finicade.com/glossary/systemic-risk)

Source: https://finicade.com/glossary/bank-run