Cryptocurrencies Weather Financial Storms, Outperform Traditional Stocks
In the wake of the recent banking crises, some investors are turning to alternative options, such as cryptocurrencies.
Banks like Silicon Valley Bank, Signature Bank, and Silvergate have faced financial turmoil, prompting some investors to flock to DEX and CEX tokens like OKB, GMX, dYdX, and GT, which have seen significant price increases in the past 24 hours.
While it’s uncertain if the banking crisis is the sole reason for the increase, it’s clear that some investors are targeting these tokens.
The broader crypto market has seen a large increase in overall value in the last day after taking a hit a few days prior. Other kinds of tokens on the rise are those related to tokenization.
Despite the recent turbulence in the global market due to bank crashes, Bitcoin and other cryptocurrencies hold strong. BTC is up by nearly 10% over the past 24 hours and is valued at approximately $24,500 at the time of publishing. While some in the industry criticize US authorities’ moves on the banks as being anti-crypto, others believe crypto isn’t to blame for bank problems.
A board member of the Signature bank said as much, commenting that it was a “strong anti-crypto message.” However, Blockchain Association Chief Policy Officer Jake Chervinsky believes crypto isn’t responsible for bank problems.
Several banks have fallen in the past few weeks, with Silicon Valley Bank being one of the most notable. Some fear that its closure may start a contagion. HSBC acquired the UK division of the bank for a single pound, or about $1.21, to help UK customers.
The Federal Reserve also decided to shut down Signature Bank, which focused heavily on crypto, citing system risk as one of the reasons behind the decision. Lastly, Silvergate missed its annual report filing, leading to investors moving to stablecoins.
While the future of the banking industry remains uncertain, the crypto market continues to see growth and stability.