CEO of Ark Invest Cathie Wood has posted a thread on her Twitter handle to comment on the instability of the banking system that has shown itself recently. She pointed out that the two leading cryptocurrencies rose in price on that.
Elon Musk, tech billionaire and boss of several leading companies, including Twitter, joined the discussion in the comments.
Slamming regulators for blocking crypto platforms
Cathie Woods stated that while the U.S. banking system seized up, the two major cryptos, Bitcoin and Ethereum, as well as other digital currencies on the market took advantage of that and "didn't skip a beat."
While the US banking system was seizing up in response to bank runs threatening regional banks, Bitcoin, Ethereum, and other crypto networks didn’t skip a beat. Instability in the banking system threatened stablecoins, the on-ramps to DeFi, in stark contrast to regulator rhetoric https://t.co/r5xwC96Pdj
— Cathie Wood (@CathieDWood) March 15, 2023
Bitcoin reached an impressive local peak, exceeding the $26,000 level for a short while, rising over 17% this week. It was followed by a 5% drop. Ethereum price has surged 20.26% too since the weekend, hitting $1,776, but it is now down to the $1,689 level.
However, Woods mentioned, the instability in the banking system as three major (and crypto-friendly) banks went down, two of them bailed out, produced a threat to the USDC stablecoin. It also impacted TUSD, BUSD and USDP.
Elon Musk steps in, supporting Woods
Also, prior to the crisis beginning, the SEC regulator sued Kraken and Gemini exchanges for their crypto lending service, and the New York attorney general filed a lawsuit against KuCoin exchange, claiming that Ethereum is a security.
Rather than attacking those "decentralized, transparent and well-functioning" financial platforms that have no central point of failure, Wood believes, the regulators should have dealt with the weak points in the traditional banking system. The clear signs of a crisis there have been looming and are similar to the crisis in the 1920s, Wood noted, perhaps referring to the Great Depression that hit the U.S. in 1929.
Twitter chief Elon Musk commented that the situation with banks is now very similar to that back in 1929.
Lot of current year similarities to 1929
— Elon Musk (@elonmusk) March 15, 2023
Robert Kiyosaki on fall of three top banks
The three aforementioned banks are Silvergate, Silicon Valley Bank and Signature Bank. All three of them had cooperated with crypto companies like exchanges. Signature Bank also worked with Paxos, the issuer of the BUSD and USDP stablecoins. Ripple CEO Brad Garlinghouse also made a statement on Twitter to say that the company had small exposure to Signature Bank. The failure of the latter, however, will not impact Ripple's daily transactions.
As reported by U.Today over the weekend, prominent investor and writer Robert Kiyosaki predicted the collapse of Signature Bank on Saturday, saying that two major banks have crashed and the third one is ready to follow in its footsteps. He did not specify exactly what bank it would be.
Arman Shirinyan
