Cryptocurrencies accumulate strong weekly increases after the banking crisis that developed this week in Europe and the United States.
The cryptocurrency with the largest capitalization, Bitcoin, rises 6.8% to $26,723.07, the highest in nine months and accumulates a weekly increase of 31%. For its part, Ethereum grows 4.4% to $1,742.96 and rises 20.6% in the last 30 days.
These sharp rises occur in the context of the banking crisis that occurred in the United States and Europe. Silicon Valley Bank and Signature Bank, for their part, were the first to start the crisis. Later Credit Suisse and First Republic Bank joined.
For Cathie Wood, CEO of asset management firm ARK Invest, cryptocurrencies act as a haven amid the current banking crisis in the United States.
“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“said the investor.
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.”
Investors are still pending how the Federal Reserve (Fed) will act after the dramatic turn that the market took last week. According to analysts, there is almost a 70% probability that the rate hike will be “only” 25 basis points; a week ago, a 50 basis point rise was more likely as the days passed. Experts such as Goldman Sachs believe that the Central Bank should pause raising rates.
Source: Ambito
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