Bitcoin reacted with a bullish rally to the news that the US authorities provided liquidity to rescue depositors of Silicon Valley and Signature Bank.
Volatility in the market is due to the fact that two banks have become victims of the hawkish policy of the US Federal Reserve, which has been steadily raising interest rates for a year now. At the same time, it is typical that both Silicon Valley and Signature Bank were actively used by cryptocurrency companies as fiat gateways.
The Fed stepped in to save depositors’ money. On March 12, the “Term Bank Financing Program” (BTFP) was announced. “Depositors will have access to all their money starting Monday, March 13,” the joint statement Treasury Departments, the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC).
Market Analyst Tedtalksmacro so appreciated this statement:
Unofficial quantitative easing began on Monday. This is a bullish signal.
The former head of the BitMEX exchange and well-known influencer in the crypto world, Arthur Hayes, was even more categorical:
Get ready for a meteoric rally in risky assets. Money Printer Launched!
The idea is clear: help by the depositor of the bursting banks means an injection of money into the economy, from which during the year only liquidity was withdrawn. This is an excellent fuel for risky assets.
The forecast for the next Fed rate hike, which is scheduled for March 22, has also changed. If just weeks ago the majority of experts voted for an increase of 0.50%, now this option is not considered at all, and the majority suggeststhat the rate will be increased by 0.25%. At the same time, a third of analysts believe that there will be no rate increase at all.
The reaction of bitcoin was not long in coming – over the past day and a half, it has grown by more than 20%. According to the Cryptocurrency Screener Cryptovizorwhich determines the market price of BTC/USD based on the results of trading on the largest spot exchanges, the maximum price of bitcoin at the time of publication was $24,444.
Tomorrow (15:30 MSK) will arrive data by the US Consumer Price Index (CPI). If it does not exceed the forecast (6.0%), then we risk finding Bitcoin on the nearest moon.
▼
The most interesting and important news on our channel in Telegram
