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Bitcoin has regained its luster as digital assets outperform following traditional finances (TradFi) recent turbulence. With the collapse of Silvergate, Silicon Valley Bank (SVB), Signature Bank and most recently Credit Suisse, cryptocurrencies appear to have become a safe haven among the mismanaged TradFi establishment.

On March 8, rumors of trouble at SVB caused digital assets to become entangled in the situation. The announcement that $3.3 billion of Circle's dollar-backed USDC stablecoin was held at SVB caused the stablecoin to depeg from the U.S. dollar.This led to digital asset investors selling positions on major exchanges. Bitcoin dropped from 22,410 to 19,500, and ether slipped almost 200 points from 1,560 to 1,368, breaking below its 200-day moving average momentarily before recovering.

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By Friday, March 10, news of the largest bank failures since 2008 had consumed financial media outlets, and banking indexes plummeted on fears of widespread contagion. The S&P Regional Banking Index (KRE) lost over 28% in roughly five trading days, and has yet to recover.

On March 12, the Federal Reserve and Federal Deposit Insurance Corporation announced they would insure the deposits of the failing banking institutions to prevent a deeper run on banks and quell fears of contagion. The actions were clear enough to stop a major failure but not enough to keep depositors from withdrawing billions of dollars. Ironically, the major winners in this recent debacle have been risk assets, most notably digital assets like bitcoin and ether.

While correlations between the stock market and digital assets have always remained in flux, one of the most consistent predictors of crypto prices has been the global money supply. This recent bout of bank insolvency has created a new mandate for central banks to stop the bleeding by printing more cash.

The chart of M2 and total crypto market cap says enough about how liquidity affects the net demand for digital assets. If the current rally since March 11 can be trusted, crypto is predicting that central banks are going to have to keep printing to avoid (another) financial crisis.

Not surprisingly, this deterministic view of M2 = bitcoin go up isnt as simple as it seems, as the Federal Reserve still has to compete with rising inflation, and hot unemployment levels. On March 10 payroll numbers came in above expectations, and just four days later the consumer price index showed a 0.5% increase in inflation. Neither of these figures has helped Chair Jerome Powell fulfill his mandate, but they have put pressure on the Fed to continue raising rates.

The conflicting data creates the question of how the Fed will react to both rising inflation and failing banks. Printing has already begun, but rate hikes would only exacerbate the problem, causing more banks to fail.

A look at the rate hike prediction since March 6 paints a good picture of how rapidly the situation is evolving.

What was widely predicted to be a year of higher for longer rate policy has shifted drastically to pause, and ultimately pivot, in the coming quarters. Policy anywhere in between is possible at this point. The Feds dot-plot forecast released on March 22 will provide a critical window into the confidence of Federal Open Market Committee members as they try to anticipate how effectively central banks can navigate hot macro data while safeguarding financial institutions.

In the middle of all this confusion sits crypto, which has steadily rallied and is now seen by many investors as a bulwark against another financial crisis. But can digital assets fully escape the trajectory of economies in decline? Should a banking crisis, inflation or further rate hikes deliver the hard landing that many assume is inevitable, will bitcoin be the escape pod?

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Bitcoin Emerges as Safe Haven as Traditional Finance Faces Turmoil - CoinDesk

Bitcoin is up 50% so far in 2023, beating major commodities and stock indexes. Industry insiders said the bank collapses have sent investors looking for alternatives to the traditional banking system and there is also anticipation of a slowdown in interest rate rises, which is helping bitcoin.

Filip Radwanski | Sopa Images | Lightrocket | Getty Images

Bitcoin climbed past the $28,000 level over the weekend as investors rediscover its appeal as an alternative banking system.

On Monday, the cryptocurrency had pulled back a bit. Bitcoin fell more than 2% to $27,705.23, according to Coin Metrics. Earlier in the day, it hit $28,554.07, it's highest level in nine months. Meanwhile, ether fell 3.5% to $1,765.60.

See Chart...

Bitcoin (BTC) this month

The weekend rally in bitcoin came amid continued turmoil in the global banking sector. On Sunday, UBSagreed to buy Credit Suissefor 3 billion Swiss francs ($3.2 billion) in a deal partly brokered by the Swiss regulators looking to stem contagion.

"Bitcoin continues to trade like a leading risk-on asset, like it has for the past two years," said James Lavish, managing partner at the Bitcoin Opportunity Fund. "The rescue of Credit Suisse has put out a large credit fire ... this emboldens bitcoin buyers who are now anticipating the Fed slowing the increase in rates and signaling a coming pause this week."

As of Monday afternoon, there is about a 72% chance of a quarter-point increase by the Fed, according toCME Group's FedWatch tool. The other 28% anticipates there will be no hike and that Chairman Jerome Powell may start to ease his aggressive tightening campaign due to the emerging financial contagion.

Bitcoin is coming off its best week since January 2021, which was right before the first bull run that year, while ether just posted its best weekly gain since August 2021. The two are up for the year by 67% and 46%, respectively.

Advocates of bitcoin have often dubbed it "digital gold" referring to it as a store of value, particularly in moments of global turmoil, and one that is uncorrelated with other asset classes.

Now, there are signals bitcoin's price movement is beginning to decouple from stocks, for now. The cryptocurrency's correlation with the S&P 500 is now at its lowest since September 2021, after reaching its highest in 2022, according to Coin Metrics.

"If one looks at the history of bitcoin and why it was created in the first place, it was precisely for events like this where the current system shows signs of weakness and hence owning an uncorrelated asset helps," Vijay Ayyar, vice president of corporate development and international at crypto exchange Luno, told CNBC. "Over the years, this argument of bitcoin being an uncorrelated asset class has been debated quite a bit, but we are now potentially seeing that viewpoint being vindicated."

Bernstein analysts Gautam Chhugani and Manas Agrawal argued in a Monday note that the market has been trading closer to its "uncorrelated non-sovereign roots" since the demise of FTX and the market structure "feels a lot healthier, with no more distortions caused by FTX and Alameda."

In contrast to bitcoin and ether's year-to-date gains, returns on gold, the dollar, U.S. equities and bonds were "less impaired last year, but have not bounced back as sharply" either, and tech-dominated indices have performed only marginally better when high growth assets were beaten down during the rising rate cycle, they added.

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Bitcoin briefly tops $28,000 for the first time in 9 months after bank crisis sparks weekend rally - CNBC

03/20 update below. This post was originally published on March 19

BitcoinBTC, ethereum and other major cryptocurrencies have seen a $200 billion boom in the last two weekstriggering a shock bitcoin price price prediction.

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The bitcoin price has come within touching distance of $28,000 per bitcoin, its highest since last summer. The bitcoin price rally has also boosted the ethereum price and other top ten cryptocurrencies BNBBNB, XRPXRP, cardano, dogecoin, polygon, and solana.

Now, after almost 200 U.S. banks were found to be dealing with similar pressures as the collapsed Silicon Valley Bank (SVBVB), the U.S. Federal Reserve is under pressure to ease back on its inflation-busting interest rate hike programsomething that could push the bitcoin price and crypto market even higher.

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"As if they did not have enough with which to contend in the face of fighting inflation on one hand and fending off recession on the other, central banks must now confront the failure of SVB and any wider implications that has for the banking system, given that higher interest rates have played some role in putting the squeeze on that banks customers and then ultimately the bank itself," Russ Mould, investment director at brokerage AJ Bell said in emailed comments.

"We will find out just how perturbed officials areif indeed they are perturbed at all."

03/20 update: Goldman Sachs analyst David Mericle has predicted the Federal Reserve will leave interest rates where they are when the Federal Open Market Committee (FOMC) meets this week. "While policymakers have responded aggressively to shore up the financial system, markets appear to be less than fully convinced that efforts to support small and midsize banks will prove sufficient," Mericle wrote in a note to clients seen by Marketwatch, adding the link between a single quarter-point hike and future inflation is "very tenuous."

The Fed's two day policy meeting starts on Tuesday with the announcement followed by a Fed chair Jerome Powell press conference on Wednesday.

Traders now expect the Fed to hike interest rates by just a quarter of a percentage point next week before rapidly reversing course and cutting rates later this year.

The shock collapse of SVB last week, as well as the closure of crypto-friendly Signature Bank, sparked fears other banks could suffer a similar fate. Economists wrote in a study out this week that 186 banks across the country could be prone to similar risks as SVB. Troubled First Republic Bank was extended a lifeline by almost a dozen of its larger rivals in order to avert its implosion.

The bitcoin price has fallen sharply over the last year as the Fed ramped up interest rates at a historic pace to drive down soaring inflationwiping around $2 trillion from the combined price of ethereum, BNB, XRP, cardano, dogecoin, polygon, solana.

The Fed's response to the SVB-led banking crisis has caused expectations to surge the Fed is poised to reverse course and has already restarted quantitative easingsomething some fear could trigger U.S. dollar hyperinflation and ultimately the collapse of the entire financial system.

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"Concerns stemming from a series of U.S. bank closures have subsided thanks to the Feds aid and now, with their balance sheet expanded about $300 billion in a week, the market is welcoming an effective end to the Feds quantitative tightening," Yuya Hasegawa, crypto market analyst at Tokyo-based Bitbank, wrote in an emailed notepointing to bitcoin's latest rally as potentially signaling the beginning of a new bull market.

"Although yields on treasury bonds have rebounded due to decreasing concerts for the economy, which leaves some room for the Fed to continue hiking rates. However, the reversal in the stock market sentiment has improved risk appetite, and it could boost the price of bitcoin further in the short term."

I am a journalist with significant experience covering technology, finance, economics, and business around the world. As the founding editor of Verdict.co.uk I reported on how technology is changing business, political trends, and the latest culture and lifestyle. I have covered the rise of bitcoin and cryptocurrency since 2012 and have charted its emergence as a niche technology into the greatest threat to the established financial system the world has ever seen and the most important new technology since the internet itself. I have worked and written for CityAM, the Financial Times, and the New Statesman, amongst others. Follow me on Twitter @billybambrough or email me on billyATbillybambrough.com.Disclosure: I occasionally hold some small amount of bitcoin and other cryptocurrencies.

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Goldman Sachs Bets Bitcoin And Crypto Are Braced For An Epic Fed U-Turn After $200 Billion Ethereum, BNB, XRP, Cardano, Dogecoin, Polygon And Solana...

Alex Dovbnya

Linus Tech Tips hacked in order to promote Bitcoin giveaway scam with Elon Musk

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The most popular technology-related YouTube channel, Linus Tech Tips, has been hacked to promote a cryptocurrencygiveaway scam with Tesla CEOElon Musk.

The channel, which has over 15million subscribers, was streaming two live "BTC" scam videos, according to cybersecurity firm SOS Intelligence.

Scammers typically hack YouTube channels to show live streams with fake celebrities like Elon Musk, asking viewers to send cryptocurrency in exchange for a chance to win a bigger prize.

This type of scam has become increasingly prevalent in the crypto community, with scammers leveraging the popularity of high-profile figures to trick viewers into sending them money.

The channel has built a loyal following over the years and has been a go-to source for many tech enthusiastslooking to learn about bleeding-edgetech products.

Upon discovering the hack, Linus Tech Tips immediately addressed the incident, stating that they are "on top of it" with the Google team and are hoping to "harden their security around YouTube accounts and prevent this sort of thing from happening to anyone in the future."

The incident highlights the importance of online security, particularly in the crypto space, where hackers are always looking for new ways to exploit vulnerabilities.

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Linus Tech Tips Gets Hacked: Elon Musk Bitcoin Scam Promoted by Most-Watched Tech Channel on YouTube - U.Today

Eoneren

It is time to start paying attention to Bitcoin (BTC-USD).

There is an indicator in the crypto world called the MVRV Ratio, which is the market value of a given token divided by the realized value of the token. Lets break down the components:

Market value is simple, it is the market capitalization of a token, which is the total tokens outstanding multiplied by the current price of the token.

Realized value, in this context, is unique to crypto (as opposed to traditional equity markets) since it is only available because of public, on-chain data. Realized value is the aggregation of the price paid for each token when it was acquired multiplied by the supply of the token. Essentially, realized value provides the tokens aggregate cost basis for all token holders.

Below are varying levels of the MVRV ratio and what they indicate, using Bitcoin as an example:

The highest MVRV ratio for Bitcoin ever recorded was 8.08 on June 4, 2011.

The MVRV ratio can be used as a reliable long-term signal to determine when Bitcoin (and the broader crypto market) is overbought or oversold. Below is the chart of Bitcoin price and the Bitcoin MVRV ratio:

Bitcoin Price and the Bitcoin MVRV Ratio (Woobull Charts)

There have been four previous periods in Bitcoins history where the MVRV ratio has broken above 1 and maintained that support level for more than 60 days, similar to the period we are in now. See the orange arrows below:

Instances where Bitcoin broke through the MVRV threshold of 1 and sustained it for more than 60 days (Woobull Charts, OneJournal Research)

For each of these instances, as well as the current time period (in blue), the below chart summarizes Bitcoin's return over the subsequent 30 days, 60 days, 90 days, 1-year, and 3-year time periods:

Bitcoin return for each instance of MVRV>1 and sustaining that level for over 60 days (DQYDJ, Chart created by OneJournal Research)

The returns speak for themselves. On average, the 90-day return is 84%, 1-year return is 797%, and 3-year return is 2044%.

Now is the point in the article where I have an obligation to state that past performance is no indication of future returns. The upside of Bitcoin today is also lower than it was when Bitcoin was in its infancy, a natural tendency for any maturing technology.

We believe the only technical analysis that is worth paying attention to is long-term focused, and even then it is just a tool. If you're presented with technical analysis that is on a time scale of days and not months or years, run. Technical analysis can be as much art as it is science, and certain technical analysis trends hold true until they don't (see the Bitcoin Stock-to-Flow model).

Technical analysis can't account for the fact that the Federal Reserve continues to raise interest rates by 0.25% even when the global banking system is showing signs of weakness, including two significant crypto banks in Silvergate (SI) and Signature Bank (SBNY). It can't account for Fed Chairman Jerome Powell noting in his press conference today that it is "the most likely case" that the Federal Reserve would not cut interest rates 2023, sending risk assets into a late afternoon selloff.

However, with something like Bitcoin that has no balance sheet to conduct fundamental analysis, and on-chain data providing new lenses to analyze an investment's behavior such as the MVRV ratio, technical analysis can help provide signals when Bitcoin stock is overbought, oversold, or in a long-term trend reversal.

With all the disclaimers aside, the recent banking sector turmoil appears to have built upon Bitcoins price momentum from earlier in 2023, and the long-term upside of Bitcoin is still significant. The MVRV ratio would indicate that the foundation for the next Bitcoin bull cycle may be forming as we speak.

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It Is Time To Start Paying Attention To Bitcoin (Technical Analysis ... - Seeking Alpha