Major cryptocurrencies rallied on Sunday, as the Federal Reserve announced a new emergency loan program for banks after Silicon Valley Bank, once the 16th largest bank in the US, and crypto-friendly Silvergate Bank both collapsed in recent days.
Bitcoin BTCUSD rose more than 7% on Sunday to over $22,000, according to CoinDesk data. Ether ETHUSD jumped 7%, briefly topping $1,600.
US…
Major cryptocurrencies rallied on Sunday, as the Federal Reserve announced a new emergency loan program for banks after Silicon Valley Bank, once the 16th largest bank in the US, and crypto-friendly Silvergate Bank both collapsed in recent days.
Bitcoin
BTCUSD
rose more than 7% on Sunday to over $22,000, according to CoinDesk data. Ether
ETHUSD
jumped 7%, briefly touching $1,600.
US stock markets were also trading higher on Sunday afternoon, with Dow futures
YM00
up 0.8%, and S&P 500 futures
ES00
up 1.2 percent. Futures for the Nasdaq 100
NQ00
rose 1.2%, according to FactSet data.
The Fed’s new emergency lending program will help ensure banks have the ability to meet the needs of all their depositors, according to a statement. Under the program, banks and other lenders will be able to pledge government bonds and mortgage-backed securities for cash, the Fed said.
Meanwhile, U.S. financial regulators said Sunday that Silicon Valley Bank depositors will have access to “all their money” starting Monday, according to a joint statement from the Treasury Department, the Federal Reserve and the FDIC on Sunday afternoon.
Over $3.3 billion, or 8% of the $40 billion in reserves of USDC, the world’s second-largest stablecoin, is held at Silicon Valley Bank, crypto’s creator Circle said Saturday. USDC, which is supposed to trade one-for-one against the U.S. dollar, retreated to near $1 on Sunday, after falling to as low as 86 cents on Saturday, according to CoinDesk data.
Pulling back the bullish sentiment is that state authorities on Sunday shut down New York-based Signature Bank, which has a number of crypto clients, according to financial regulators.
All depositors in Signature bank will be made whole, according to regulators.
The closure of Signature Bank came after crypto-friendly Silvergate Bank said on Wednesday it would wind down operations. That could further reduce crypto companies’ access to banks, which have traditionally been reluctant to work with crypto entities, in part due to a lack of regulation, industry participants said.
Signature Bank provides deposit services for its customers’ digital assets, but does not invest in, trade in, maintain its own balance sheet or provide custody for digital assets, and does not lend against or make loans secured by such assets. the company said.
A representative at Signature Bank declined to comment.
