Signature Bank collapse means crypto will ‘be forced’ to move to Wall Street: pro
- Signature Bank's collapse over the weekend represents a 'blow for crypto.'
- BTC price is rallying Monday, but one pro says major coins are 'not out of the woods'.
- Nevertheless, crypto is an asset class founded 'as a direct response' banking crisis.
Signature Bank’s sudden collapse over the weekend represents a ‘blow for crypto,’ Truflation CEO Stefan Rust said in a statement obtained by Invezz. According to Rust who runs the independent inflation data aggregator project, the crypto industry is now “scrambling” for new banking partners to handle on and off-ramps.
BTC price is rallying hard: ‘not out of the woods’Copy link to section
Bitcoin (BTC/USD) price rallied around 10% to kick off Monday’s trading session as investors are breathing a sigh of relief the finance and banking system avoided a major catastrophe. However, the latest Signature Bank news along with Silvergate’s problems imply the main Fiat banking partner of choice for the crypto industry is gone.
According to Rust, crypto will now “be forced” to move their business to Wall Street-esque banks, like JP Morgan, Barclays, and other banks designated “systemically important.” Rust writes:
With regulators like the US SEC making life ever harder for cryptocurrency firms, this may not be simple or even possible for many.
Fed decision shouldn’t matter for cryptoCopy link to section
Rust notes that European and US equity markets are trading in the red Monday morning ahead of Tuesday’s inflation reading. The Fed indicated that January’s CPI reading means it is more likely to lift rates by 50 basis points next week. If February’s data adds additional concerns to the market, investors will be incrementally worried. Rust, a critic of CPI data that you can read about in a prior Invezz interview, writes:
Of course, none of this should matter for crypto – an asset class founded as a direct response to the last banking crisis. One possible good news story to come out of this would be a decoupling from the main markets like we saw in 2020. With the main fiat on and off ramps shut down, this could be the moment that we see some separation.
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No bailouts in cryptoCopy link to section
The concept of bailouts or bail-ins in the crypto industry does not exist. The price of one BTC is always one BTC and 1 ETH will always equal 1 ETH. This represents the value of their utility and purchasing power “remains equal for the services you need” on the respective networks.
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