• The US banking crisis is worsening, and yet Bitcoin (BTC) has surged nearly 40% in recent weeks.
• Silicon Valley Bank analysis shows that more than 186 banks are prone to collapse due to the fall of SVB.
• Bitcoin’s decentralized nature means it isn’t subjected to the same regulations as fiat currencies and its value is determined by market demand rather than government intervention.

US Banking Crisis

The US banking crisis seems to be worsening each day, with a recent report from economists using the now-bankrupted Silicon Valley Bank (SVB) analysis showing that more than 186 banks are prone to collapse following the fall of SVB.

Bitcoin Price Surge

Despite this, the crypto market including Bitcoin (BTC) has reacted positively over the past weeks, surging nearly 40%. However, traders are still confused about whether this is a “bull run” or another potential “bull trap.”

Reasons Behind BTC Rally

Bitcoin has always been a decentralized asset that operates independently without traditional banking systems. This means it isn’t subjected to the same regulatory or monetary policies as fiat currencies, and its value is determined by market demand rather than government intervention. With major banks such as SVB, Silvergate, and Signature bank being one of the first to open the banking crisis floor, traditional bankers may just continue to accumulate BTC which could surge its price even further.

Safe Haven Asset

A time of financial uncertainty such as this one is when some people may see cryptocurrencies such as Bitcoin as a safe haven for their assets. This could be why Bitcoin’s continuous rally has proved to be inevitable amid this crisis.

Crypto Exchange Luno Comment

Vijay Ayyar, vice president of corporate development and international at crypto exchange Luno told CNBC “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 like Bitcoin makes sense.”