Bitcoin Price Climbs to $24,900 - Is $26,500 The Next Big Target?

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Despite the looming banking crisis in the United States, the price of Bitcoin has surprised the crypto community with its latest surge. The news of the bank failure initially sent shock waves across the investors’ circle, however, the alarmed regulators immediately stepped in to propose a rescue plan and ensure that the situation doesn’t go out of their hands.

The rescue plan propelled the growth of many cryptocurrencies in the sector and helped in restoring investors’ confidence back in the financial system. Read ahead to know how the price of Bitcoin got affected by the bank’s failure, and what experts think about the price predictions of this leading cryptocurrency.

Price History of Bitcoin

Even after the failure of crypto-focused banks in the United States, Bitcoin has shown an increase of around 50% this year. This run of this cryptocurrency becomes significant in light of the tough time this crypto had last year. Bitcoin crashed by 65% of its value last year due to a major crypto crisis that included the failure of FTX, bankruptcies, collapses of multiple projects, etc. The crypto began its year with a value of around $16,500, and soon, within the first few months, it even crossed the mark of $26,000, thereby providing huge returns to its investors.

As per the views of market experts, it is argued that the Federal Reserve’s reduced interest rates and huge purchases made by market participants (commonly referred to as “whales”) are the primary factors fueling the expansion of Bitcoin. Another special feature of this growth is that it is bringing new investors into the crypto market, thereby increasing the price of other cryptocurrencies as well. Given the rate of growth this crypto has demonstrated in the month of March, experts are hopeful that Bitcoin will continue its bullish trend for the major part of this year.

At the time of writing, the price of Bitcoin is $26,562.33. Crypto is having a humongous market capitalization of $513 billion in the industry with a circulating supply of 19 million BTC coins. Its value has soared by more than 34% in the last seven days. There are multiple theories going around in the market justifying the recent surge in the price of Bitcoin. Some claim that the loose monetary policy of the government is driving the rise of Bitcoin, while others support the rescue plan, which has recently been released by the government to protect the depositors from the recent failure of three U.S. banks.

Factors Leading to the Recent Surge in the Price of Bitcoin

Three prominent American banking institutions (Signature Bank, Silicon Valley Bank, and Silvergate Bank) crashed this past week as a result of their inability to process customer withdrawal requests. The board of these banks made poor financial and investment decisions that ultimately caused them to default on clients’ withdrawal requests, which was the leading cause of the collapse of these organizations.

The fall of these institutions was significant in the sense that the majority of these banks were the primary lenders to the crypto firms. One of the first institutions to begin taking cryptocurrency deposits from its clients was Signature Bank. It has deposits reaching about $16.52 billion from firms that are involved in the digital assets market. Even big crypto companies, like Coinbase, were drawn to the bank’s payment platform, Signet, to use its services. A wave of panic immediately rushed across the cryptocurrency market as shortly after news of Silicon Valley Bank’s collapse surfaced. The failure of the other two banks quickly gave rise to alarming signals for the country’s banking system.

Considering the gravity of the situation, the regulators have to step in to protect the money of the depositors and bring back the confidence of the investors in the financial system of the country. As per the Joint Statement by Treasury, Federal Reserve, and FDIC, the depositors were intimated that they would have access to all of their money from Monday, March 13. The taxpayer won’t incur any losses as a result of Silicon Valley Bank’s bankruptcy. Similarly, all depositors of Signature Bank were made whole as part of the systemic risk exception for this bank.

Through the announcement of these measures by the regulators, the immediate impact of a bank failure quickly subsided, and many market analysts in the sector were taken by surprise by the way the crypto market looked after the bank crisis. In light of these measures, it is concluded that the U.S. government’s notification regarding the protection of the money of Silicon Valley Bank and Signature Bank depositors is primarily responsible for the price recovery of Bitcoin.

What lies ahead for Bitcoin?

Many cryptocurrency investors have now been filled with confidence thanks to Bitcoin’s fast recovery, especially after experiencing a difficult year in the market. Bitcoin was hovering below $20,000 just a few months ago, but the U.S. government’s recovery plan for Silicon Valley Bank and Signature Bank has revived investor confidence in digital currencies. For the remainder of the year, it is predicted that Bitcoin’s price chart will maintain its upward trend.

As mentioned before, the rise of Bitcoin has translated into the speedy recovery of other cryptocurrencies as well. The price of many cryptocurrencies, such as Ethereum, Binance Coin, and Cardano, has been on a rise since the last week.

Within no time, Bitcoin has crossed the mark of $26,500 on its price charts. Going by the experts’ predictions, it is anticipated that this crypto would conclude this year with a massive figure of $28,000 if it continues its current price trend in the market.

Conclusion

Bitcoin has already hit the big target of $26,500 on its price charts this week. Nobody would have thought that the crypto that has been trading around $20,000 a few months ago would cross this mark in a few weeks’ time. If it goes by the present growth rate, Bitcoin price would surpass the boundary of $28,000 within this year only.

The speedy recovery of Bitcoin is largely credited to the timely resolution plan of the U.S. government for rescuing the banks in the middle of the crisis. After having a difficult run in the market last year, it is expected that Bitcoin would continue its momentum on its price charts and would help in the healthy development of the cryptocurrency market.

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