Banking Crisis Sees Bitcoin Market Cap Rise By $26 Billion
Today, March 20th, was hectic in Bitcoin and crypto market. Some major coins and altcoins have posted gains in their seven-day prices. While BTC is up at 3.47% over 24 hours, its seven-day gains are 27.93%. On the other hand, Ethereum has gained 12.82% in 7 days, although it is losing at the 24-hour price.
Surprisingly, the banking crisis did not stop BTC bulls from raising prices. Instead, the events led to a positive trend reversal for the digital asset. The interest that Bitcoin has gained has boosted its price to a high 9-month gain and market cap of $26 billion.
BTC Price Soared Amid Ongoing Banking Crisis
Bitcoin’s chart on the price tracker shows that it posted impressive gains earlier today, hitting $28,554.07 before pulling back towards the highs. current price of $27,851. At today’s peak, the market cap gained an additional 46.50 billion. This price gain is a new 9-month high from June 13, 2022.
Many Bitcoin supporters often claim that it is digital gold, a store of value during the global financial turmoil. But BTC is outperforming gold recently as it has gained up to 70% in this 2023 while the latter has gained 9%.
The number one cryptocurrency is setting its pace as usual, while other coins follow behind. Today’s price performance shows BTC gains while many altcoins lose. For example, Ethereum, the second cryptocurrency, is losing instead of winning in the last day.
Others, including BNB, XRP, ADA, MATIC, DOGE, BUSD, SHIB, LTC, etc., fell within 24 hours. But as BTC gains, so does WBTC and it shows a 3.49% gain in 24 hours and a 27.29% gain in 7 days.
What’s Driving Bitcoin’s Rally
The banking crisis is one of the main factors driving the recent BTC rally. With the collapse of Silvergate, Silicon Valley and Signature banks, many investors began to lose confidence in traditional banking systems.
Even though the US feds announceed funding to support banks in meeting the demands of depositors, the fear is yet to subside. Many people are concerned that the US banking system is fragile and prone to unexpected failure.
A report of economists about how a bank run could bring down 190 US banks further exacerbated the situation. the analysts uncovered that 10% of existing banks had lower capitalization than Silicon Valley Bank. Also, 10% of US banks have more sizable unrecognized losses than SVB. However, the closed bank had high uninsured leverage, in addition to losses, leading to its failure.
Unfortunately, economists compared the SVB issue with other banks, finding that many other banks are already at risk. This growing distrust in the stability of the banking sector has pushed more investors into the bitcoin market.
Featured image from Pexels and chart from Tradingview.com