I had written earlier that the Cypriot parliament would likely have to institute some kind of deposit tax--even after it had voted down one version--because the Troika (ECB/International Monetary Fund/euro zone partners) had given the Cypriots an ultimatum: We will give you 10 billion euros in aid, and no more. Need 17 billion? Go raise the other 7 billion. And the implicit threat was that the ECB may not continue to backstop the Cypriot banks.
That's what started this whole thing about the deposit tax. But now, the ECB has extended an olive branch: it said that it would continue to provide liquidity to Cypriot banks, even though the Cypriots voted down a deposit tax.