Bitcoin rallied to near $22,500 after US regulators announced that they would fully protect deposits from bankrupt Silicon Valley Bank.
●CoinDesk Market Index (CMI): 1,052, +8.4%
Bitcoin: $22,482, +9.3%
Ethereum: $1,614, +9.6%
● S&P500: 3,861.59, -1.4%
Gold: $1,880, +1.0%
After a nerve-wracking Thursday and Friday, crypto investors over the weekend decided to fully protect all deposits at the failed Silicon Valley Bank (SIVB) as US regulators decided to protect all deposits at the failed Silicon Valley Bank (SIVB). I was relieved to announce that I will cover everything in the unlikely event that there is a problem with the coin (USDC) reserves.
Bitcoin (BTC) is up more than 9% in 24 hours at time of writing, near $22,482. It was below $20,000 at one point on the morning of the 10th.
“Following recommendations from the FDIC and the Federal Reserve, and after consulting with the President, Treasury Secretary Yellen has authorized steps to complete the resolution of the Silicon Valley Banks in a way that the FDIC fully protects all depositors.” Treasury Secretary Yellen, Fed Chairman Jerome Powell and FDIC Chairman Gruenberg said in a joint statement Wednesday morning.
“Today, we are taking decisive steps to protect the American economy by strengthening public confidence in the banking system,” the joint statement said.
Mark Connors, head of research at crypto manager 3iQ, wrote in his weekly report that these measures are “seemingly risk-friendly”, but “there are too many uncertainties and M2 is still declining,” he warned.
Ethereum (ETH) is also up more than 9% in 24 hours, near $1,614. Other major crypto assets, which fell last week in the aftermath of the Silicon Valley Bank collapse, also rallied over the weekend. Layer 1 tokens Aptos (APT) are up over 13% and Cardano (ADA) is up over 11%. The CoinDesk Market Index, which shows the performance of the entire market, also rose by more than 8%.
Circle, which issues USD coin (USDC), said on the 11th that it would “cover the shortfall” if it were unable to withdraw all of its $3.3 billion in cash deposited with Silicon Valley banks. USDC had fallen to $0.88 before the announcement and is now above $0.99.
Stock markets were hit by concerns in the banking sector, with the Nasdaq down 1.8% and the S&P 500 down 1.4%. The S&P fell 5% in one week, its worst week since September 2022.
3iQ’s Connors said the “regulatory whack-a-mole game” would continue if measures to protect customer assets were prolonged, with among other ramifications continued consolidation in the banking industry and regulation of stablecoins. Said it would speed it up.
“We don’t know the outcome yet,” he continued.
｜Translation: coindesk JAPAN
｜Editing: Takayuki Masuda
｜Original: First Mover Asia: Silicon Valley Bank Failure Highlights Small Banks’ Vulnerability; Bitcoin Soars Past $22.5K
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