Can cryptocurrencies replace traditional banks in the future?
The collapse of regional banks in the US in 2023 increases the demand for digital currencies.
In March 2023, a number of regional banks in the US recorded spectacular bankruptcies, which raised concerns about the stability of the entire banking sector in the United States. After the announcement of extraordinary and long-unprecedented actions by the US Federal Reserve, hope returned among investors that the financial sector in the US will begin to stabilize. However, according to a popular expert related to the cryptocurrency industry, the crisis may be just beginning.
Bitcoin (BTC) and the benefits of bankruptcies in the banking sector
Undoubtedly, the collapse of Silvergate and Signature Bank, as well as the sharp drop in First Republic Bank shares in April 2023, have provided new concerns about the safety and resilience of the banking sector in the world's largest economy.
In this context, a popular digital currency expert, based on the "inverse Jim Cramer" strategy, predicts that the banking crisis may actually start now.
At this point, it is worth adding that the predictions of the aforementioned expert are not based on any particular logic, but they cannot be completely ignored. Moreover, Standard Chartered Bank previously predicted that the price of the oldest cryptocurrency could reach as much as $100,000 by 2024. A lot of turmoil in the banking sector contributed to the increase in the BTC price, which in turn benefited the broadly understood digital currency market.
With the growing interest directed towards the cryptocurrency sector, banks are becoming more and more concerned about their position in the economy. A large group of analysts believe that digital tokens may eliminate traditional banks in the future, which in turn may translate into further serious complications for the banking system.
Meanwhile, the well-known investor and billionaire Stanley Druckenmiller recently revealed that he took a short position on the US dollar. The American then stated that he predicted that the Federal Reserve (Fed) would soon be forced to lower interest rates in response to the economic slowdown in the United States. This move can be very beneficial for all cryptocurrencies, in particular, such as Bitcoin (BTC) or Ethereum (ETH). This is because the weakening of the USD often leads to increased interest in alternative financial assets.