Not long ago, the number one agenda of the world was the bankruptcy of US-based banks. So much so that first Silicon Valley Bank and then Signature Bank went bankrupt. Some banks began to experience a liquidity crisis at that time. One of them was First Republic Bank. In fact, several giant banks, including JPMorgan and Bank of America, provided $30 billion in liquidity to First Republic Bank and saved it from bankruptcy.
However, all this seems to be insufficient. Because, First Republic Bank recently made a balance sheet statement after the markets closed. In the statement, it was stated that bank deposits decreased by 35.5 percent on an annual basis and decreased to 104.5 billion dollars. With the news of the balance sheet, the markets started to become volatile again.
First Republic Bank shares fell 50 percent!
1-month stock chart of First Republic Bank. Source: TradingView
The collapse of the environment of confidence especially affected First Republic Bank investors. The shares, which were traded at $ 16 a few days ago, suddenly lost about 50 percent of its value and fell to $ 8 levels. In fact, the New York Stock Exchange (NYSE) had to stop trading so that the decline would not deepen. As such, the allegations of the banking crisis, which were on our agenda almost a month ago, came to the fore again.
First Republic Bank has not declared any bankruptcy at this time. However, some attempts were made to get rid of the financial problems experienced. Sources familiar with the matter announced that the assets of the bank could be sold. Of course, while all this was happening, the dollar also lost value. It was not difficult to guess where the people who moved away from the dollar went.
Bitcoin (BTC) has risen above 30 thousand dollars again!
Worries about the banking crisis in the US have benefited Bitcoin (BTC), the king of the cryptocurrency market. BTC, which has already been in an uptrend for a while, has found the excuse it was looking for with the latest developments. BTC, which spent the last 24 hours just above $ 27 thousand, pinned the level of $ 30 thousand with a sharp upward momentum. As of the writing of this article, BTC, which is valued at around 8.8%, is trading at $ 29,800.
There is movement not only in Bitcoin, but also in altcoins.
The rise in Bitcoin has had an impact on all altcoins, especially Ethereum (ETH). All of the top 10 altcoins (except stable coins) on a volume basis entered an uptrend. The continuation of the uptrend in Bitcoin may sustain the movement in altcoins.
So how is it that the banking crisis in a country like the USA reflects positively on Bitcoin?
While the dollar is depreciating, the main reason for the upward trend in Bitcoin and altcoins is that crypto assets are not tied to any of these currencies. Bitcoin is not tied or focused on any of the traditional currencies. This is exactly why people turn to cryptocurrencies in times of crisis. The increase in demand provided by the inflow of money causes the appreciation of all cryptocurrencies, especially Bitcoin.
Note: This content cannot be considered as investment advice.
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