Bitcoin Rises as Latest Teetering U.S. Bank Sends Traders to Crypto Haven
Shares of PacWest Bancorp fell by more than 50% in after-hours action on Wednesday following a Bloomberg report the U.S.-based lender is mulling a range of strategic options. Bitcoin (BTC) was up on the news, rising more than 2% to $28,900 at press time.
The news on PacWest comes only days after First Republic Bank was taken over by the Federal Deposit Insurance Corp. (FDIC) and then sold at auction to JPMorgan. Other regional bank stocks have been moving lower on Thursday including Western Alliance Bancorp, down 28%, and Metropolitan Bank, down 19%.
Despite the banking crisis, Federal Reserve Chairman Jerome Powell declared the banking system to be “sound and resilient” after the latest Federal Open Market Committee meeting Wednesday. However, it hasn’t stopped traders from flocking to Bitcoin as a safe haven.
Many traders are looking to cryptocurrencies like Bitcoin due to its decentralized and stable nature. While stablecoins like USDT are pegged to the US dollar, other cryptocurrencies, including Bitcoin, are exempt from government manipulation. Therefore, many traders consider it a safer investment option than traditional banking systems.
This recent banking crisis has highlighted the need for diversification in investments. With more and more traders turning to cryptocurrencies, it seems like Bitcoin and other cryptocurrencies are set to become a more important part of the overall financial system.
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According to https://www.coindesk.com/markets/2023/05/03/pacwest-bancorp-plunge-sends-bitcoin-price-higher/
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