Silvergate, SBV collapse ‘definitely good’ for Bitcoin, Trezor exec says

The ongoing situation of banks successful the United States has galore affirmative implications for Bitcoin (BTC), according to an enforcement astatine the hardware wallet steadfast Trezor.

On March 14, Bitcoin broke $26,000, a price level not seen since June 2022, posting the biggest gains this twelvemonth truthful far. The multi-month precocious followed a bid of shocking events successful the U.S. banking industry, with banks similar Silicon Valley Bank (SVB), Silvergate and Signature shutting down operations.

According to Trezor’s Bitcoin expert Josef Tetek, the existent crisp emergence of Bitcoin terms — which is the fastest emergence successful terms truthful acold successful 2023 — appears to beryllium a nonstop effect of the “apparent fragility of the banking system.”

Tetek said that the existent banking situation could perchance marque Bitcoin look arsenic a safe-haven and risk-off asset. He emphasized that Bitcoin was created soon aft the satellite encountered the fiscal situation of 2008 and was “likely a effect to the unfairness of bailouts.”

“The existent events are a timely reminder of wherefore we request Bitcoin,” Tetek said, adding that the existent events are not truthful bully for galore crypto businesses and assets that are centralized, referring to Circle’s USD Coin (USDC). The expert stated:

“The existent demise of definite banks is decidedly bully for Bitcoin arsenic such, but not a bully situation for custodians of immoderate kind, and erstwhile again we reiterate that 1 the safest environments is to self-custody assets.”

According to Tetek, the caller events with Silvergate and SVB intelligibly amusement that counterparty hazard successful the banking strategy is simply a “serious problem,” though it is sometimes good hidden. He added:

“Banks nary longer really clasp our money, but lend it retired and bargain volatile assets with it. Depositors are, successful fact, the banks' creditors. Understandably, radical are looking for alternatives specified arsenic Bitcoin."

Tetek besides suggested that Silvergate’s illness was a “direct effect of its concern relationship” with the bankrupt crypto speech FTX, portion SVB’s illness was a effect of “poor hazard management.” He went connected to accidental that SVB had a ample vulnerability to semipermanent treasuries, which tanked successful terms arsenic a effect of the abrupt involvement complaint hikes, portion the slope failed to person hedges successful place. “SVB had small transportation to the crypto industry,” Tetek added.

Related: SVB crisis: Here are the crypto firms denying vulnerability to troubled US banks

Tetek’s remarks travel amid Barney Frank, Signature Bank committee subordinate and erstwhile U.S. Congressman Barney Frank, arguing that the latest U.S. banking events are connected to crypto.

“I deliberation portion of what happened was that regulators wanted to nonstop a precise beardown anti-crypto message,” Frank stated, claiming that issues astatine Signature were “purely contagion from SVB.”