The recent collapse of major banks in the United States and the need for federal intervention have reignited discussions about finding the most effective ways to protect crumbling economies. Comparing the episode to the 2008 financial crisis, prominent economist Peter Schiff found that increasing banking regulations contributed to the worsening of the financial crisis.
A deeper analysis of Silicon Valley Bank (SVB) by a group of economists revealed that almost 190 banks in the United States are at risk depositor-driven collapse. It has been pointed out that monetary policy written by central banks could damage long-term assets such as government bonds and mortgages, creating losses for banks.
The financial crisis of 2008 was caused by the collapse of the housing market. However, Schiff believed that the crisis was caused by “too much government regulation”.
When the government imposed a lot of new #banking regulations after 2008 #Financial crisis, we were assured that what was happening now would never happen again. But one of the reasons we had the financial crisis in 2008 was too big a government. ordinance. Therefore, this crisis will be even worse.
— Peter Schiff (@PeterSchiff) March 17, 2023
Schiff highlighted how the US government had implemented new banking regulations after the 2008 financial crash, while promising that “what’s happening right now will never happen again.” Added by:
“But one of the reasons we had the financial crisis in 2008 was too big a government. ordinance. That’s why this crisis will be even worse.”
Because of this, it is important for Schiff to find the right balance between regulations and banking institutions Puerto Rico regulators shut down Schiff’s bank not so long ago, July 4, 2022.
Despite no evidence of wrongdoing, Puerto Rico’s regulators shut down my bank anyway for net equity issues instead of allowing a sale to a highly qualified buyer promising to put up capital well in excess of regulatory minimums. As a result, accounts are frozen and customers may lose money.
— Peter Schiff (@PeterSchiff) July 3, 2022
At the time, Schiff was reminded by Crypto Twitter why millions of people around the world vouch for Bitcoin (BTC) adoption in pursuit of financial freedom.
Related: The SVB mix-up forces India’s SVC Bank to issue a clarification notice
On the other end of the spectrum, crypto entrepreneurs have begun to double down on Bitcoin’s epic comeback. Former Coinbase CTO Balaji Srinivasan predicted this The value of Bitcoin would reach $1 million within 90 days.
Sir, I believe we have a deal https://t.co/9JYaLNo9Eq
— James Medlock (@jdcmedlock) March 18, 2023
As Cointelegraph reported, pseudonymous Twitter user James Medlock and Srinivasan made the bet based on their differing views on the future of the US economy amid ongoing uncertainty over the country’s banking system.
Srinivasan’s bet revolves around a looming crisis that will deflate the US dollar and push the price of BTC to $1 million.