Many now feel that they have been proven right in not trusting the banks. Bank crises, collapses, and plummeting bank stocks have dominated headlines in the past week. Three American banks have failed, and Credit Suisse is currently down over 60 percent after a crisis sale. The instability in the banking sector reinforces the mantra of crypto enthusiasts - 'You cannot trust the banks, it is not safe to keep your money there.' This has been the driving force behind the purchase of cryptocurrencies - the belief that one cannot trust the banks.
In the world of cryptocurrencies, however, it's been a different story. Bitcoin has surged by over 27 percent in the past week, up 70 percent since the beginning of the year. Much of the recent rise in Bitcoin's value has occurred in just the past few days.
As uncertainty continues to plague the market, many feel that the crypto world's predictions are coming true and that they can rely on Bitcoin!
Closes crypto bank
The current situation, where the stock market is falling and cryptocurrencies are rising, is unique. Usually, cryptocurrency tends to follow the stock market. There has been a correlation, especially between cryptocurrency and the Nasdaq index. When Nasdaq falls, crypto falls. However, this changed a few months ago. what is boiling you may ask?
It is because we now feel that we have been proven right in not trusting the banks. The idea of Bitcoin emerged in the aftermath of the 2008/2009 financial crisis, with the aim of creating complete freedom from the traditional banking system and central banks. The American banks that collapsed, Signature Bank, were linked to the crypto community. What was surprising was that this was the only bank closed by the authorities, even though in many ways it was better positioned than both Silicon Valley Bank and Silvergate Bank. This must be an attempt by the political authorities to combat cryptocurrency.
The price of gold is rising
Worth mention is that it's not just cryptocurrencies that are rising after the market turmoil: the price of gold has reached its highest level in a year, with an ounce of gold now rising to over $2,000. Historically, it's more common for gold to rise in turbulent times than for cryptocurrencies to do so.
Investors often see gold as a hedge against inflation. Simply put, this is because the commodity is limited in quantity. Gold cannot be printed in the same way as the dollar can. When economic conditions deteriorate, the price of gold traditionally rises. I am personally stacking up with gold now!
I am Olebulls and I’m working in IT and Finance. I’ve always been passionate about finance and finding smart ways to manage and save money. I believe establishing money management strategies as early as possible is the key to securing your future. I began using different strategies myself in real estate, stocks and crypto and I have now built some decent amounts.
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Disclaimer: This is not financial advice. I am not an expert. You should do your own research before investing.
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