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Bitcoin put on a spurt today with a 5.3% rise in price. In the traditional banking sector First Republic Bank has been hammered again, falling as much as 60% over the last two days.
Bitcoin surges again
Bitcoin fooled the markets again as many were expecting the number one crypto asset to at least fall back to the $25,000 support. Bitcoin had been tracking down over the previous week or so, and many analysts were calling for a much deeper pull back.
Today’s growth spurt took Bitcoin back to just touch the $30,000 resistance, taking the rest of the crypto market with it. At time of going to press bitcoin has taken a breath and is hovering at just over $29,700.
Another bank about to fail?
In the traditional banking sector things are still not looking too rosy. First Republic Bank is one of a group of banks that are on the edge following the demise of Silvergate Bank, Silicon Valley Bank, and Signature Bank.
It remains to be seen whether a group of the largest US banks, which helped to prop up the stricken bank to the tune of $30 billion, will have done enough to stop the rot.
If today’s rout is anything to go by, the $30 billion may have been good money thrown after bad. At one point today, the FRC price had fallen a further 66% to the downside, taking the price from $14.20 down to $4.75.
Since then the price has edged back to $6.38, but confidence must be completely gone as depositors leave in droves. A report on the BBC stated that $100 billion in deposits had left the bank in March alone.
Is this the game?
Leading financial agencies, regulators, and banks, ably assisted by the mainstream media, are continuing to try and blacken the name of Bitcoin and the cryptocurrency sector.
The game is to drive the average retail investor away from crypto by imposing suppressive regulations and by advising everyone to stay away from these digital assets.
The game is becoming ever-more difficult to pull off as the very institutions that the retail investor is being told are the safest, are those that are failing.
Retail investors need a hedge
In the current financial environment investors are starting to become aware of the situation of the banks. It’s all very well for the Federal Reserve, the Treasury, and the FDIC to try to assuage fears by saying they will backstop all the bigger banks, but when that happens it's the average Joe/Jane who bear the cost through more diminishment of their purchasing power.
Bitcoin at least is still available for those wanting a hedge out of the bank madness. However, the Biden administration may have the perception that crypto is a real threat to the dollar, so stand by for more anti-crypto actions in the coming weeks and months.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.