Jim Bianco urged regulators to offer unlimited insurance on bank deposits as they did in 2008 because "$250k is a made-up number."

Bianco, who runs Chicago-based Bianco Research, tweeted what he believed needed to happen following the collapse of Silicon Valley Bank Friday.

The Federal Deposit Insurance Corporation (FDIC) took control of SVB after California regulators shut it down when a failed $2.3 billion capital raise sent its stock crashing. The agency protects deposits of up to $250,000.

However, Bianco urged the FDIC to "raise the deposit insurance ceiling to unlimited as they did this in 2008. Besides $250k is a made-up number anyway. So make up a bigger number."

 He also said banks should raise the interest they paid on deposits rates to 3% or 3.5% immediately: "This way the public gets the message that you money is safe, no matter the bank, or the amount, and the rate paid on your money is at least competitive with other alternatives."

"This is not a solvency crisis like 2008. Bad loans or poor investments were not made. Money was not lost. So, everyone is going to get their money back," Bianco emphasized at the beginning of his post.

However, the advent of online banking meant that depositors could very easily move their money and demanded instant liquidity, he added. "This should scare the hell of bankers and regulators worldwide."

Bianco didn't immediately respond to a request for comment from Insider.