Credit Suisse Shares Fall Almost 25%, Is Bitcoin Going On Another Rally?
As the global banking crisis spreads, Credit Suisse Group AG, a Switzerland-based global investment bank and financial services firm, appears to have been caught in the contagion, which could lead to more gains for Bitcoin and the crypto market. The bank’s shares CS fell by almost 25% during the week.
This plunge comes after the bank’s largest shareholder, Saudi National Bank (SNB), reportedly revealed that it could not provide further support to Credit Suisse. In accordance Reuters, Citing an SNB statement, the bank said it “would no longer buy any more shares in the Swiss bank on regulatory grounds.”
Another stock crash, another bank run?
The Saudi National Bank’s latest withdrawal of support for the struggling Credit Suisse has raised more speculation about whether this could eventually lead to the downfall of the struggling bank. The SNB currently has a large stake in Credit Suisse of up to 9.88%. SNB Chairman Ammar Al Khudairy told Reuters the bank could not go beyond 10% due to regulatory concerns.
Following the announcement, Credit Suisse shares fell 24% on Wednesday, March 15. Credit Suisse shares have since been on a downward trend since the collapse Silicon Valley Bank; it is recent fall due to the withdrawal of SNB support has seen it hit a new record low with a value of $2.10 at the time of writing.
From last year, after a 10% share buyback, the SNB committed an investment of 1.5 billion dollars in Credit Suisse. The struggling bank’s latest big dump came just months after publishing its 2022 annual report, resulting in a massive withdrawal of funds from the financial institution.
While the company has continued to seek financial assistance after seeing a decline in customer activity, experts have suggested that the bank may eventually fail, given the recent collapse of three big banks in the US this past week.
Is Bitcoin Heading For Another Rally?
With previous Bitcoin (BTC) rally attributed to the collapse of prominent banks, speculation has been raised around the crypto community that another major bank failure, such as Credit Suisse, could once again cause the cryptocurrency to extend its bullish trend.
In the past week, since the big three US banks Silvergate, Signature bank and Silicon Valley fell, many investors in the financial sector have sought an alternative way as a store of value. So far, crypto-assets like Bitcoin have proven to be the best option. The latter has been reflected in their prices.
This has caused Bitcoin and the rest of the market to enter a bullish period over a short period of time. Furthermore, the BTC price chart indicates another potential upcoming rally after the previous rally.
Recent events suggest bad news for the global economy, but the crypto market and Bitcoin in particular have benefited. The banks’ continuous fall could equip BTC and the rest of the crypto market for another peak as the stock of value narrative gains momentum again as an appealing alternative to the fiat system.
Featured image from Unsplash, chart from TradingView.
