Bitcoin Holds the $28,000 Level in the Middle of a Global Bank Crisis

The Bitcoin rally continues for a sixth successive week, seeing it reach heights that were unimaginable months or a year ago. The largest cryptocurrency—and the crypto market in general—was pummeled in the past 12 months, suffering one blow after another.

There was the FTX crypto exchange collapse which ruined a consolidation period which came after a couple of pandemic years. The world’s current financial crisis took its toll as well, but to everyone surprise, Bitcoin broke the link with traditional assets in the middle of a bank crisis.

Just this month, two major banks in the USA and Switzerland have collapsed after failed bank runs. And, when everyone thought that Bitcoin would fall through the cracks, a bull run seems to materialize in just the right time.

Holding Its Ground

Bitcoin hold its ground in the middle of a global bank crisis. Not just holding it, mind you – when the rally started, everyone thought it can reach a maximum of $24K or $25K. Weeks later, Bitcoin has stabilized at $28K, and we’re now talking about it going even higher. The bullish momentum is expected to last, as spot buying drives it forward. But, institutional investors are still selling, while the lack of whale buyers might spell an end to the rally.

That’s a far-off theory, though, as it’s been weeks before Bitcoin lost ground. Currently hovering at around $28,200, the latest rally shows that people still see Bitcoin as an alternative to stocks and bonds. Which is a great idea considering the demise of the Silicon Valley Bank and Credit Suisse. These are major banks that were recently liquidated after unsuccessful bank runs that left them in the dust. How did they lose the money? By reinvesting deposits in bonds.

The fact that whales are not looking to sell the current rally is encouraging. But, if Bitcoin is to retain the current level and go up, they must pop up at some point in the future.

Retain Investors on Spot Exchanges Help as Well

Another factor that’s been helping the current rally are retail investors on spot exchanges. They’re a driving factor behind the rally. Bitcoin addresses that hold less than 10 BTC are racing up to new heights. The current resistance is between $28,000 and $30,000 which is similar to the June 2022 breakdown.

Advanced investors are waiting for the Fed to announce new policy rates on March 22 before making further moves. The Fed’s rate announcement is likely to have some effect on the price and has been a driver for significant volatility earlier.

Regardless of what that happens, some smart experts have seen a correlation between Bitcoin’s latest run and gold’s price fractal from the 1970s. At the end of the 70s, the US inflation rate rose over 10% and held that level throughout the 1980s. In the worst of this inflation crisis, gold rose 750%. A similar fractal may be potentially back in Bitcoin, just like the sky-rising inflation.

If history repeats itself, Bitcoin investors will have many reasons to celebrate.

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