Bitcoin market cap (BTC) added $194 billion in 2023. Its 66% year-to-date (YTD) gain significantly outperforms the major Wall Street bank stocks, largely due to concerns about global banking crisis they rise
In addition, bitcoin separated from US stocks for the first time in a year, with its price up 65% versus the S&P 500’s 2.5% gains and the Nasdaq falling 15% in 2023.
Wall Street banks will lose $100 billion in 2023
The six largest US banks – JPMorgan Chase ( JPM ), Bank of America ( BAC ), Citigroup ( C ), Wells Fargo ( WFC ), Morgan Stanley ( MS ) and Goldman Sachs ( GS ) – lost nearly $100 billion in the market. year-to-date valuations according to data collected by companies CompaniesMarketCap.com.
Bank of America shares are the worst performing among Wall Street banking players, with valuations down nearly 17% since the start of the year. Goldman Sachs is holding its own with a year-to-date decline of nearly 12%, followed by Wells Fargo (-9.75%), JP Morgan Chase (<6.5%), Citi (1%).
Valuations of US banks have fallen amid the ongoing collapse of US regional banking. This includes last week’s announcement Silvergatea bank focused on cryptocurrencies, closed its doors and subsequently took over Signature Bank and Silicon Valley Bank regulators.
Related: Breaking: SVB Financial Group files for Chapter 11 bankruptcy
The crisis further deepened with the near-collapse of the First Republic bank, which was saved at the last moment by a.s A combined $30 billion injection from Wells Fargo, JP Morgan Chase, Bank of America, Citigroup and others.
Cyprus and Greece deja vu?
Bitcoin’s rise in the face of the growing US banking crisis is similar to how it responded during the banking collapses in Cyprus and Greece.
Meanwhile, the price of BTC rose by as much as 5,000%. Cyprus financial crisis in 2013, which was caused by Cypriot banks’ exposure to over-indebted regional real estate companies.
The situation was so serious that the Cypriot authorities closed all banks in March 2013 to avoid a bank run.
When Greece faced a similar crisis in 2015 and imposed capital controls on citizens to avoid bankruptcy, the price of Bitcoin increased by 150% during this period.
“Concerns about the stability of the banking system, along with falling real interest rates, create a good environment for Bitcoin’s comeback,” he remarked Ilan Solot, co-head of digital assets at London-based broker Marex, adds that crypto is “viewed by some investors as a hedge against systemic risks.”
This article does not contain investment advice or recommendations. Every investment and trading step involves risk and readers should do their own research when making decisions.
