The Bitcoin price has risen in the last week as a result of the United States’ worsening banking crisis and the federal government’s measures to ameliorate its impact. On Tuesday, Bitcoin (BTC) broke through the $24,000 barrier, showing some stability in the cryptocurrency market. According to statistics from crypto market tracker Coingecko, the value of the alpha cryptocurrency increased by 10% in the last 24 hours after plunging to its lowest point since January.
To ease public disquiet following the demise of three banks, the Federal Reserve has started an emergency lending scheme. Silvergate Bank, which was actively involved in the cryptocurrency business, shut down its cryptocurrency payment platform on March 3 and declared bankruptcy last Wednesday. On Monday, Silicon Valley Bank declared that it will be unable to pay its financial obligations. Signature Bank was closed down by federal regulators after a few days.Â
During this time, Bitcoin increased by 9% in a single week.At the time of writing, the price of Bitcoin was $24,425, according to the most recent data; Bitcoin’s ascent continued on Tuesday, bolstered by the US government’s decision to act as a lender of last resort, effectively insuring all uninsured US bank accounts.
Bitcoin, the most valuable cryptocurrency by market value, has risen by about 25% since last Friday. With the demise of SVB and Signature Bank, both of which were regarded as crypto-friendly institutions, the surge is extremely surprising. The broader market also saw USDC lose its anchor against the US dollar over the weekend, with the cryptocurrency sliding below the 0.92 level on Saturday as word of the banks’ difficulties extended to the cryptocurrency market, before regaining its peg on Monday.
Meanwhile, Nansen data reveal that the amount of USDC traded on exchanges has increased in recent days. The entire supply on exchanges is up 8% from a week earlier. In addition, the prior day’s largest USDC deposit was 18.3 million, a 41% increase over the previous record of 13 million.
“Bitcoin is growing in value as financial stability fears drive Treasury yields to plunge,” says Oanda’s senior market analyst Edward Moya. Federal government intervened to avert another massive bank run as mistrust about traditional banking grew among some Americans.”
Following a sharp drop, the global cryptocurrency market recovered over the weekend, reaching $1.02 trillion. The recent government announcement to protect all Silicon Valley Bank depositors’ cash was a critical factor that influenced the entire bitcoin market positively.
Given the available data, it is difficult to argue that the spectacular failures of SVB and Signature Bank may serve as a public service announcement for the adoption of self-custody and the promotion of digital currencies in a world where fiat currency ownership has become somewhat obsolete and, in some cases,’strongly discouraged.’
