The article explores systemic risk in banking ecosystems by drawing parallels with ecological systems and network dynamics. It highlights how the increasing complexity of financial networks can lead to instability, as seen in the 2007–2008 financial crisis. The authors use simplified models of financial networks to illustrate how complexity and stability interact, and suggest policy lessons to minimize systemic risk. They compare financial systems to ecosystems, noting that while ecosystems have evolved over time, financial systems are relatively new and influenced by human intervention. The article discusses the role of derivatives, the propagation of shocks through financial networks, and the importance of regulatory measures to ensure stability. It also examines the impact of liquidity shocks, funding liquidity shocks, and the need for regulatory capital and liquidity ratios. The authors argue that regulatory frameworks should focus on systemic risk rather than individual bank risk, and suggest that modularity and diversity in financial systems can enhance resilience. The paper concludes that understanding the topology of financial networks is crucial for effective regulation and that lessons from ecology can inform financial policy.The article explores systemic risk in banking ecosystems by drawing parallels with ecological systems and network dynamics. It highlights how the increasing complexity of financial networks can lead to instability, as seen in the 2007–2008 financial crisis. The authors use simplified models of financial networks to illustrate how complexity and stability interact, and suggest policy lessons to minimize systemic risk. They compare financial systems to ecosystems, noting that while ecosystems have evolved over time, financial systems are relatively new and influenced by human intervention. The article discusses the role of derivatives, the propagation of shocks through financial networks, and the importance of regulatory measures to ensure stability. It also examines the impact of liquidity shocks, funding liquidity shocks, and the need for regulatory capital and liquidity ratios. The authors argue that regulatory frameworks should focus on systemic risk rather than individual bank risk, and suggest that modularity and diversity in financial systems can enhance resilience. The paper concludes that understanding the topology of financial networks is crucial for effective regulation and that lessons from ecology can inform financial policy.