Bitcoin rallied earlier this year on the back of some of the biggest bank runs in decades. The banking sector crisis could be making a comeback, according to a second-leg up in BTC priced in First Republic Bank shares. Take a look below.
Bitcoin Priced In Banks Gets Another Leg Up
Several banks struggled to meet a sudden influx of depositors seeking to withdraw funds this past March. The crisis in the banking industry kickstarted a massive surge in Bitcoin price.
The top cryptocurrency soared relative to USD, but when priced in bank shares of the afflicted banks, the charts were simply breathtaking to see. Now, as shares of First Republic Bank plummet another 40% and more than $100 million in deposits flee the bank, BTC priced in bank shares is making another leg up.
Priced in bank shares, BTC never made a second high in 2021. Later in March of this year, there is a massive breakout through downtrend resistance. Another leg up here could indicate that the issues across the banking industry aren’t over, and could even be escalating.
Why First Republic Bank Stock Shares Are Plummeting
First Republic Bank share price falling is the result of a negative first quarter earnings report. The bank revealed that across Q1, more than $100 million in deposits sought refuge elsewhere.
First Republic CEO Mike Roffler said the bank would be”pursuing strategic options” and “taking steps to meaningfully reduce our expenses to align with our focus on reducing the size of the balance sheet.” The steps include laying off up to a quarter of the workforce, slashing executive level salaries, and more.
Typically, companies will hold a Q&A session with analysts, but First Republic ended the call, bringing back painful memories of the 2008 financial crisis, Reuters reports.
Bitcoin skyrocketing in bank shares isn’t due to BTC being in an unstoppable bull run, but due to extreme weakness in traditional financial institutions. The further shares fall, the higher the top cryptocurrency climbs.
Although this doesn’t directly related to a corresponding increase in USD value, the last time there were a string of bank runs, Bitcoin rallied by more than 40% in several days. What happens this time?
Bitcoin is making another leg up against #FirstRepublicBank pic.twitter.com/XNaaEUL4Aq
— Tony “The Bull” (@tonythebullBTC) April 25, 2023