High-impact news, including the CPI release and the US banking crisis, significantly contributed to Bitcoin price topping $26K.
For the first time since June last year, Bitcoin price traded above $26K on Tuesday after the United States Bureau of Labor Statistics released the Consumer Price Index (CPI) data yesterday that was in line with expectations. The top digital asset by market capitalization gained as much as 10 percent during the day, but the rally was short-lived as Bitcoin closed the day trading below $25K. According to our latest crypto price oracles, Bitcoin price exchanged around $24.6K during the early Asian trading market.
As a result, Bitcoin’s market capitalization stood at approximately $479,436,070,331, and its 24-hour traded volume at around $54,906,757,429. According to aggregate data from Coinglass, over $151 million was liquidated from the Bitcoin market in the past 24 hours.
Notably, the entire cryptocurrency market registered total liquidations of approximately $311 million following the spike in volatility.
Bitcoin Price and Wider Crypto Market Heavily Bolstered by US Banking Crisis
Over the last weekend, the United States federal government had to bail out two major banks, Silicon Valley Bank and Signature Bank. Moreover, the Federal government printed $25 billion to provide SVB and Signature Bank depositors with liquidity. As such, market economists believe the Federal government has reduced its stance toward fighting the high inflation rate.
“Thanks to the Fed’s bank bailout, now all US bank deposits are at risk. That risk comes not from bank failure but from inflation. The value of all bank deposits will fall as inflation socializes the losses. Anyone with savings in a bank should withdraw it fast and buy gold,” veteran trader Peter Schiff noted.
A similar sentiment was shared by Ark Invest founder Cathie Wood who noted that she was not surprised the crypto industry gained in value as the US banking sector imploded.
“Regulators have focused investors on the threat that crypto poses to users, but this weekend turned that theory upside down. As a single point of failure in the US banking system, SVB became the threat to stablecoins and the DeFi ecosystem when it broke Circle’s USDC peg to the dollar,” she noted.
Following the weekend banking crisis, most investors saw the importance of Bitcoin in deflationary terms. For instance, Binance converted the remaining $1 billion in Industry Recovery Initiative funds from BUSD to Bitcoin, Ethereum, and BNB. Moreover, Bitcoin has been on the rise while most banking stocks have been plummeting.
#Bitcoin is the inverse of banks pic.twitter.com/d1Ys9FWGF1
— The Bitcoin Mindset 🟠 🧠 (@thelevelupexp) March 13, 2023
Side Notes
Meanwhile, the second largest digital asset by market capitalization, Ethereum, broke out of a multi-month logarithmic downtrend. This is despite the fact that the United States financial regulators think Ethereum and the rest of the altcoin industry are unregulated securities.
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