One other Lehman-like second is brewing up within the banking area with Swiss banking big Credit score Suisse being at a “essential” second now. Credit score Suisse Chief Government Officer Ulrich Koerner stated that the financial institution is making ready for the most recent overhaul and has requested buyers lower than 100 days for a turnaround story.
The Swiss financial institution’s credit score default swaps i.e. the price of insuring the agency’s bonds in opposition to default jumped 15% final week to ranges not seen for the reason that 2009 Lehman disaster.
— Investing.com (@Investingcom) October 2, 2022
Together with Credit score Suisse, Deutsche Financial institution can also be assumed to be in an analogous scenario. The asset base of those two European banks mixed is $2.5 trillion which is 4 instances the asset base of the Lehman brothers throughout the time of its collapse.
As we see historical past may very well be repeating itself, international buyers are driving their consideration as soon as once more to Bitcoin as a secure haven. The decentralized cryptocurrency was created after the Lehman collapse to insulate buyers from the worldwide banking establishments and international markets.
Whereas the worldwide market has been exhibiting huge volatility final week, Bitcoin surprisingly stays rock strong. As of press time, Bitcoin is buying and selling at $19,200 with a market cap of $367 billion.
If Credit score Suisse actually goes the Lehman approach, it might in all probability function a large increase for Bitcoin and crypto over the following decade.
Bitcoin or Gold?
Commenting on this newest improvement, Barry Silbert, founding father of Digital Forex Group, the mother or father agency of Grayscale Investments, wrote: “Bitcoin is about to grow to be the secure haven asset. Nowhere else to cover”.
Bitcoin critic Peter Schiff was fast to reply to it stating that it will be prudent to purchase Gold and drop Bitcoin. He wrote: “The place do you conceal from The Grayscale Bitcoin Belief? It’s down 80%. Why would Bitcoin out of the blue grow to be a secure haven asset if it has by no means been a secure haven prior to now? If you’d like a confirmed secure haven drop #Bitcoin and purchase #gold”.
However Bloomberg’s senior commodity strategist Mike McGlone not too long ago stated that each Bitcoin and Gold can outperform over the following decade wanting on the present macro situation. He added: “Essentially the most central banks in historical past hike[d] charges with the world tilting towards recession. Decrease commodity and risk-asset costs often is the solely approach out with deflationary implications, which ought to buoy the worth of gold and its digital model, Bitcoin”.
The introduced content material might embrace the non-public opinion of the creator and is topic to market situation. Do your market analysis earlier than investing in cryptocurrencies. The creator or the publication doesn’t maintain any accountability in your private monetary loss.