Cathie Wood, CEO of asset management firm ARK Invest, claimed that cryptocurrencies functioned as a safe haven amid the ongoing banking crisis in the United States.
Cathie Wood, CEO of asset management firm ARK Invest, stated that cryptocurrencies act as a refuge in the midst of the current banking crisis in the United States. He also said that the fall of banks like Silicon Valley Bank (SVB), Signature is due to the failure of the Federal Reserve’s policy of raising interest rates to try to contain inflation in the US.
Wood assured from his Twitter account that he was “baffled that banks and regulators couldn’t convince the Fed that disaster was coming.”
Regarding the work of cryptocurrencies, he said: “This debacle would not have been possible in the decentralized, transparent, auditable and over-secured ecosystem of crypto assets. In fact, over the past week, crypto assets have behaved like safe havens: along with gold, their prices have appreciated.”
And he expanded: “In our opinion, crypto is a solution to the central points of failure, opacity and regulatory errors in the traditional financial system. Made the scapegoat for policy errors, cryptocurrencies will move abroad, depriving the US of one of the most important innovations in history“.
As for the run on the bank, Wood spoke about the role of the Fed. “Despite a yield curve that inverted last July, and credit default swaps that started blinking red, the Fed continued to vote UNANIMOUSLY to raise rates in 75 basis point increments. They paid no attention to commodity prices and other indicators of inflation that were falling apart.”
Regarding the bankruptcy of the banks, he was emphatic: “In my opinion, Fed policy was the main culprit. Due to a drought in VC funds and higher returns in money market funds, deposits left the US banking system.”
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