Your guide to Bitcoin, Ethereum and Web 3.0
The price of Bitcoin soars, up 19.8% in the past 24 hours after regulators and the Joe Biden administration stepped in to convince investors that depositors at the failed Silicon Valley Bank would be made whole — and that the U.S. banking system remains on solid ground .
At the time of writing, Bitcoin was trading at $24,428, up nearly 20% in the last day and 6% jump in the last hour, according to CoinGecko. Ethereum, the second largest digital asset, was up 15% in 24 hours; it is up 3.4% in the last hour, priced at $1,680.
The rest of the crypto market is also in the green, with Dogecoin, the ninth largest digital asset by market cap up 11% in the last 24 hours, trading hands at $0.073.
The cryptocurrency market bled last week after uncertainty surrounding Silicon Valley Bank’s crash spooked investors. At one point on Friday, Bitcoin’s price fell to as low as $19,662.
SVB suffered a $42 billion bank run on Thursday, with Nasdaq halting trading in the bank’s shares and regulators shutting down the institution by Friday. A number of crypto companies admitted their exposure to the firm throughout the weekend, sending the prices of every coin and token down.
Circle, the issuer of the USDC stablecoin, revealed that it had $3 billion locked up in the bank. Stablecoin, the fifth-largest digital asset by market capitalization, lost its peg to the dollar following the news – falling as low as 87 cents at one point.
Then, on Sunday, New York state financial regulators decided to shut down Signature Bank, citing systemic risk.
But the Federal Reserve, the US Treasury and the FDIC said on Sunday that depositors of SVB and Signature Bank would be able to withdraw their money on Monday – assuring investors that the situation was under control.
The Biden administration has insisted that losses incurred by these banks “will not be borne by taxpayers” and should not be considered a “bailout.” After all, the shareholders of these banks will be wiped out and the management has been fired.
But not everyone agrees with the administration’s description. The Wall Street Journaleditorial office today did not cut the words: “This is a de facto bailout of the banking system, even as regulators and Biden officials have told us the economy is great and there was nothing to worry about.”
USDC has now regained its peg, sparking optimism among investors plugging cash into the digital asset space.
