Analysts: The Banking Crisis Proved the Points of Many BTC Fans

Earn Your First Bitcoin Sign up and get $12 Bonus Referral bonus up to $3,000

The banking crisis in America and Europe – which appears to be drawing back somewhat at the time of writing – truly vindicated several BTC and Ethereum believers according to many analysts in the industry.

BTC Fanatics Have Been Proven Right

The banking crisis saw at least three separate institutions in the U.S. – including Silvergate, Silicon Valley Bank, and Signature Bank – shutter their doors for good. Meanwhile, the problems spread to several monetary houses in Europe like Credit Suisse, which was saved at the last minute when it was purchased for about $3 billion by UBS.

People are now looking at BTC and other crypto holders as individuals with good heads on their shoulders. JPMorgan strategist Nikolaos Panigirtzoglou commented in a recent note:

For crypto supporters, the U.S. banking crisis exposed the weaknesses of the traditional financial system given banks’ maturity mismatch is susceptible to bank runs. Crypto supporters have been arguing for a long time that the crypto ecosystem is superior, not least because deposits are held in entities such as stable coins which as a digital form of money market funds are 100% backed with high-quality liquid assets and are thus less susceptible to runs.

His sentiment is very different from the thoughts of JPMorgan head Jamie Dimon, who in the past has referred to BTC and other forms of crypto as Ponzi schemes. In 2024, the next bitcoin halving is all set to occur. This is an event that happens every four years or so in which bitcoin is set to see the rewards delivered to miners cut in half, hence the word halving.

These kinds of circumstances cause the currency to become rarer, thus increasing its value, so traders can likely expect the asset to shoot up in price in about 12 months or so. Panigirtzoglou said:

This would mechanically double bitcoin’s production cost to around $40,000, creating a positive psychological effect. This is because bitcoin’s production cost has historically acted as an effective lower bound.

In addition, he also said that the recent introduction of BTC-based non-fungible tokens (NFTs) could help the asset do better as well. He mentioned:

This is because metadata such as text [and] images can be inscribed on the bitcoin network itself, without relying on smart contracts as seen with other blockchains, where NFTs are created through smart contracts.

Really Helping NFTs

John Stefanidis – chief executive of Balthazar, an NFT-based gaming platform – says Ordinals and other BTC-centered NFTs have done great things for the industry thus far. He stated:

The recent movement in bitcoin is also positive for the NFT market, as all boats rise with the tide. It’s likely to have a positive impact on the overall sentiment of the market. Bitcoin is currently trading above US$28,000, which we haven’t seen since June last year.

Source: Read Full Article