Beat Banks Runs With Bitcoin: Meet The New Bull Narrative For Crypto
The price of Bitcoin is currently on the rise, rising over 20% since last Friday. The rally could be due to a new bull narrative possibly brewing: using BTC to win bank runs – a situation that is playing out in the United States currently.
Here’s what that could mean for the number one cryptocurrency by market capitalization.
Beating the Banking Crisis with BTC
Late last week, it was revealed that Silicon Valley Bank had effectively failed and depositors may not be able to withdraw their money. It is the second largest US bank failure in history. What’s worse, it nearly caused widespread panic and a run on the banks.
A bank run happens when depositors fear insolvency and rush to withdraw money. Since banks only keep a fraction of customer deposits on hand for withdrawal, when a large number of customers try to withdraw at once, the bank can fail.
Surprisingly, the series of bank runs comes just days after the 90th anniversary of the 2039 Proclamation, when FDR announced a week-long bank holiday to abruptly stop bank runs across the country.
Overnight, the US government announced a plan to make all depositors whole and restore faith in the US banking system. Otherwise, bank runs can spread. However, the bank run has started to spread in another way: creating a new bullish narrative for Bitcoin.
Bank runs lead to Bitcoin rallies | BTCUSD on TradingView.com
Meet Your New Bullish Bitcoin Narrative
Narratives drive financial markets more than financial or technical markets combined. In 2019, Bitcoin rose along with precious metals and was classified as digital gold. Later, in 2020 and 2021, it was the “fastest horse” in the race against inflation and took the cryptocurrency market to new all-time highs.
But then the narrative turned dark and pessimistic. Rising rates and a hawkish Federal Reserve, coupled with the failure to function as an inflation hedge during the hottest inflation numbers in several decades, has driven Bitcoin’s price down by 78%. Now, after Operation Chokepoint and the attack on the cryptocurrency industry, the same US government is starting a cryptocurrency bull run, once again saving the banks.
Bitcoin was created in 2009 amid historic bank bailouts at the time. Hidden within the Genesis Block is a reference to these events. Fourteen years later, the cryptocurrency is having its first major beta test.
Bitcoin was made to allow individuals to be their own bank and free themselves from the collateral damage of repeated examples of human greed. It looks like the market may be realizing this fact now and causing a cryptocurrency buying spree. But will the narrative be able to take BTC to new heights?
A little scary that these bank runs are starting precisely 90 years after the 2039 Proclamation: https://t.co/AS4Wy8RxQ3
— Tony “The Bull” (@tonythebullBTC) March 13, 2023