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Bitcoin (BTC) is on the verge of hitting the $30,000 milestone, but regional banks in the United States are facing significant anxiety and fear. Investors are worried about the possibility of contagion following the recent struggle of PacWest, a California lender.
The bank’s shares fell as much as 60% overnight, prompting him to reassure investors and confirm that he is in talks with potential partners and investors about a deal, according to The Telegraph.
Although he insists he hasn’t experienced any unusual deposit flows, regional bank shares are down more than 5% today, with none of the 349 banks in the sector posting gains.
Regional banks suffer losses: shares of 130 companies fell by more than 5%
Concerns about regional banks are no doubt fueled by the recent collapse and sale of First Republic Bank to JPMorgan Chase. This high-profile event highlighted the potential risks and challenges small banks face, especially in the current economic climate.
Shares of all regional US banks are in the red zone. Source: Genevieve Roche-Decter on Twitter.
Despite broader concerns in the financial sector, Bitcoin has climbed above the $29,000 level, gaining 1.7% over the past 24 hours, which could be fueled by ongoing concerns related to US banks.
This suggests that there may be some investors who are turning to alternative assets as a potential hedge against risks and uncertainties in traditional financial markets that show no signs of easing in the short term.
Also, according to CryptoCon, a Bitcoin market analyst, the exact BTC bull market is here. This is based on the crossover of the midline of the three-week Keltner Channels, a technical indicator that measures volatility and trend in bitcoin. When BTC crosses the middle line currently worth $26,500, it is a strong signal that a bull market is about to begin.
Keltner BTC channels. Source: CryptoCon on Twitter.
Additionally, CryptoCon notes that historically, Bitcoin has not returned below its midline after a crossover, supporting the argument that the bull market continues. This was true, the analyst said, as the crossover consistently delivered months of bull market activity.
Bitcoin rises as US bank failures rise
Daan crypto Trades, a crypto market analyst, has analyzed the dominance of Bitcoin and its potential impact on the wider crypto market. According to the analyst, Bitcoin dominance, which measures the percentage of the total cryptocurrency market capitalization that is made up of Bitcoin, is currently trading at range highs in the 48-49% region.
Daan suggests that if Bitcoin can break through this range and reach new local highs, it could move to 52% or higher. This likely leads to the continued trend of Bitcoin dominance, which has intensified in recent months.
However, the analyst notes that if bitcoin remains in the range between $27-30k, this could lead to a recovery in ALT/BTC pairs as bitcoin dominance falls. This suggests that altcoins or alternative cryptocurrencies to bitcoin could outperform bitcoin in the short term.
BTC uptrend on 1-day chart. Source: BTCUSDT on TradingView.com.
At the time of writing, the best cryptocurrency on the market is trading at $29,000. Over the past 24 hours, total short liquidation totaled $100 million. The question is whether Bitcoin will continue its uptrend or experience a healthy pullback to replenish liquidity below its critical resistance levels.
Featured image from iStock, chart from TradingView.com