The banking crisis has sent shockwaves through the financial markets, with three banks already shut down and Credit Suisse on the brink of collapse. Investors are looking for safety and stability, and Bitcoin (BTC) is proving to be a solid option for those seeking a secure store of value.
The digital currency is trading at around $26,624 and has been enjoying a solid week – rising by over 30% in the last seven days on the back of encouraging economic data. This injection of confidence has consolidated the market and driven out weak hands before pushing up the price.
Cryptocurrency Sector Booms While Banking Industry Struggles
Financial institutions, particularly in the US, are spending tremendous effort trying to reduce the wider adoption of the cryptocurrency sector instead of focusing on the banking industry, which is crumbling in front of them.
Unlike the banking sector, cryptocurrency has approximately $1 trillion market capitalization. Despite mainstream media’s ongoing claims of crypto being used for illegal activities, why are banks going down while simultaneously people appear to be investing in Bitcoin?
Jamie Dimon says the “pet rock” (aka Bitcoin) is attractive because it is sheltered from financial chaos. Governments or organizations cannot control it, and the Bitcoin market has no bail-ins or bail-outs.
However, Henry Ford was well aware of the complexities of the banking and financial system when he famously proclaimed: “It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
He knew that most people are not educated on the inner workings of finance and banking and would be outraged if they were to comprehend the reality of the system. A system based on debt, and one which needs to create more debtors to stay afloat continually.
Bitcoin Defies Turmoil: Price Soars 7.2% in 24 Hours
Currently, Bitcoin is trading at $26,760, witnessing a rise of 7.2% in 24 hours, while traditional financial markets are in turmoil. This week has been a good one for Bitcoin, as reassuring consumer price index figures on Monday sparked a 13% surge in its price.
This week, the idea that Bitcoin could offer a haven during a potential banking crisis has gained traction, providing a positive environment for the minor pullback. Furthermore, Monday saw the RSI jump +13%, allowing BTC to avoid a rounded top pattern and regain its upward movement.
Since Monday, there has been an additional $735 million in open interest for Bitcoin on Binance alone. Looking at the Long Short Ratio, traders show solid bullish sentiment due to the banking crisis. This could be a potential opportunity for market makers to take advantage and make some profits.