‘Catastrophic Scenario—JPMorgan Sees U.S. Banking Crisis As Boosting Bitcoin After $300 Billion Ethereum And Crypto Price Surge

Bitcoins: BTC: Due to the worsening banking crisis in the US this year, the Federal Reserve has expressed serious doubts about its ability to control the situation.

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The price of bitcoin has more than doubled since falling to $15,000 per bitcoin late last year against Ethereum and other smaller cryptocurrencies, as traders turn their attention to the $31.4 trillion earthquake.

Now, after a major tech investor admitted it "burned a million to say they were going to print a trillion," analysts at JPMorgan confirmed that the US banking crisis has driven retailers into bitcoin in recent months. Let's call it a "terrible situation".

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MORE than FORBES' "new market order". Fed Could Boost Bitcoin Price By $100 Billion As Ethereum Falls Billy Bambara

"The US banking crisis has boosted demand for gold," JPMorgan strategists led by Nicolas Panierzaglu and Miki Enkinen wrote in a note to clients seen by Bloomberg . While institutional investors have piled into gold, retail investors are increasing their exposure to bitcoin this year to hedge against growing risks of a US recession.

The banking crisis that began earlier this year with Silicon Valley bank and incumbents Silvergate and Cermacher claimed ownership of First Republic in San Francisco and led to BacWest, Arizona and Western Alliance to falling stocks in Los Angeles.

This week's bank sell-off came despite assurances from Federal Reserve Chairman Jerome Powell that the US banking system remains "healthy and strong" after the Fed's 10th straight rate hike. The rapid succession of rate hikes by the Fed is partly responsible for the banks' problems.

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More from Forbes "All bets are off." $31.4 Trillion Earthquake Could Hit Bitcoin and Ethereum - Billy Bembrough

This week's Fed rate hike "will continue to put pressure on regional bank accounts," Noman Shaikh, Bitcoin's head of financial management, said in emailed comments.

“It looks like we're back to macro factors driving the market. Against that background, we are now in bearish cryptocurrency mode," said Shaikh, adding that "Bitcoin's dominance in terms of Ethereum activity continues."

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