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The United States might be tilting toward the edge of another major crisis, with signs already showing in some regional banks. According to a recent Reuters report, New York Community Bank (NYCB) is currently undergoing a mega sell-off in its share price after investors showed no confidence in the firm after a massive dividend slash.
The shares of the bank on the New York Stock Exchange fell by 37.67% at the close of trading on Wednesday, bringing the stock to a price of $6.47. While the fallout seems to be on a corrective path, with after hours trading jumping by 3%, the headwinds are still there, and it underscores the strain many banks are still facing.
It is worth noting that New York Community Bank was the savior of the then-popular crypto-focused Signature Bank. Signature Bank’s forced liquidation by authorities came at a time when other regional banks like Silvergate Bank and Silicon Valley Bank experienced intense capital flight that marred their operational capabilities.
Now, the same bearish sentiment is returning, and a tsunami, if allowed to break out, might take a significant toll on the New York economy.
Bitcoin (BTC) to rescue?
One of the core appeals of Bitcoin is its immunity to related financial crises of this nature. Many top proponents like Michael Saylor have always held onto the premise that Bitcoin is sound money guarded fiercely by a piece of code.
Bitcoin is immune to inflation per its design, which includes a hard cap of 21 million coins that can ever be produced. With top traditional banking giants like BlackRock now properly invested in BTC through the iShares Bitcoin Trust, more security has been lent to the coin as the accumulation from the firm and other spot Bitcoin ETF issuers will boost the supply shortage for the asset.
These events have caused veterans like Samson Mow to predict a $1 million Bitcoin price in the long term. Indicators suggest that Bitcoin might be a worthy savior to shield investors from the pangs of an NYCB-like collapse.
Arman Shirinyan
Alex Dovbnya
