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Bitcoin value rises after the US banking crisis
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Bitcoin value rises after the US banking crisis

The value of Bitcoin (BTC) has undergone a tumultuous ride in the past week, owing to the swiftly developing banking crisis in the US and the government's efforts to mitigate the consequences. As of now, three banks have already collapsed, and the Federal Reserve has initiated an emergency lending program to quell the panic. Silvergate Bank, which had deep connections in the crypto world, ceased its crypto payments platform on March 3 and declared bankruptcy last Wednesday. Silicon Valley Bank, a startup lender, also revealed last week that it was unable to fulfill its obligations. Federal regulators shut down Signature Bank on Sunday.  

 After the US government revealed its plan to cover Silicon Valley Bank's and Signature Bank's debts over the weekend, consumer confidence has driven Bitcoin's value up by over 15%. Investors in cryptocurrencies such as BTC and ETH were immediately relieved, and the positive sentiment spread throughout the crypto community. Binance Coin (BNB) rose by more than 13% on the news, while other major altcoins Cardano (ADA) and Polygon (MATIC) increased by over 10%.  

The big question facing investors is whether this marks another indication that the Bitcoin bottom has been reached, or if it is simply a dead cat bounce, where prices rebound temporarily during a longer-term negative trend before falling again. While the rebound represents relief, the fact is that we are currently in unprecedented territory with regards to the geopolitical climate, rampant inflation, and the Fed's stance on interest rates. Those familiar with the industry know that even under the best of circumstances, predicting the short-term price movements of digital assets is nearly impossible. This is especially true in the current market environment. 


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