# Bank Bailout
A bank bailout is a form of financial assistance provided to banks, usually by governments, in the event that they are unable to meet their obligations and can no longer continue functioning. Governments may provide such bailouts for various reasons, including preventing economic depressions or avoiding systemic risk within an economy. In some cases, countries have even gone so far as to nationalize entire banking systems in order to protect against possible collapse.
The term “bank bailout” comes from the phrase “bailing out”, which refers to saving someone or something from failure or crisis by providing money or other resources at a critical time – essentially acting like a life preserver thrown into turbulent waters. This type of government intervention has been used throughout history; however it began receiving increased attention during the 2008 global financial crisis when several large banks were bailed out with taxpayer dollars due to excessive levels of risky investments and inadequate capital reserves (in particular subprime mortgages).
In terms of cryptocurrency markets, bank bailouts pose both risks and opportunities for investors: on one hand there is potential for market manipulation if certain entities become “too big too fail”; but on the other hand these events often result in greater governmental oversight over financial markets which could create more stability over time – particularly if regulations place limits on how much debt institutions can take on relative to total assets held. Furthermore since cryptocurrencies operate outside traditional banking channels there may be less vulnerability associated with this asset class compared to stocks and foreign exchange transactions denominated in fiat currencies such as US Dollars.
