Focus on the woes of American banks

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Key Insights: Crypto market cap jumped $77.35 billion to $1.134 billion as investors reacted to a growing crisis in the US banking sector. Coinbase is looking beyond US borders amid growing anti-crypto sentiment. Congress announces a March 29 hearing to dig deeper into the collapse of Silicon Valley Bank and Signature Bank. Crypto market decouples from NASDAQ as banking crisis deepens

On Friday, the total crypto market cap jumped 7.32% (+7.32%) to end the day at $1.134 billion. Demand for bitcoins (BTC) and altcoins surged as investors reacted to the latest news related to the US banking sector.

Crypto Market 180323 Daily Chart

Investors reacted to news that SV Financial Group (SIVB) had filed for bankruptcy protection. While the filing may not have come as a surprise, Fed bailouts surpassing levels seen during the 2008 global financial crisis and 11 banks bailing out First Republic Bank likely alarmed traditional investors.

The NASDAQ composite index fell 0.74%, with the Dow Jones and S&P 500 posting losses of 1.19% and 1.10%, respectively.

Crypto Market NASDAQ 180323 Hourly Chart

Ethereum Staking Inflows Rise on ETH Return to $1,800

On Friday, ETH staking inflows hit their highest level since March 9. The US banking crisis drove ETH to $1,800 for the first time since August 2022. With the Shapella upgrade scheduled for April 12, the increase in staking inflows reflects sentiment towards the US banking system. crisis, suggesting a bullish price response to the Shapella upgrade.

According to CryptoQuant, ETH staking entries fell from 18,208 ETH on Thursday to 22,176 ETH on Friday. Above 20,000 levels should be a bullish signal given historical staking inflow levels.

ETH 180323 staking entries

After the upgrade, stakers can withdraw the staked ETH from the Beacon chain, which went live in December 2020. The upward trend alleviates the fear of high demand for disengagement.

This week, Coinbase (COIN) warned of long withdrawal times due to increased demand from punters, saying:

We expect the opt-out request to be high soon after the upgrade, and the protocol can take weeks or even months to process opt-out requests.

Coinbase Announces Expansion Plans Beyond US Borders

On Friday, news hit Coinbase (COIN) feeds targeting overseas jurisdictions. Increased regulatory and lawmaker scrutiny has forced platforms to look beyond US borders to avoid missing the growing interest in the digital asset space.

According to a report from Bloomberg, the crypto exchange is in discussions to identify other locations in response to the deteriorating regulatory and banking climate for crypto companies.

NASDAQ-listed Coinbase shares rebounded 10.62% on Friday to end the day at $74.98. Rising demand for cryptos and plans to create an ex-US global trading platform prompted the breakout session.

Coinbase Stock Price 180323 Daily Chart

Dubai announced a new partnership with South Korean entities in blockchain and metaverse-related industries.

According to the announcement, the DMCC has signed two Memoranda of Understanding (MoU) with South Korean entities to support Dubai’s goal of expanding its position as a hub for Web3 businesses. As part of the MoU, the DMC will help South Korean Web3 companies based at the DMCC Crypto Center and its new Gaming Center.

The crypto winter hurt the growth of Web3 and the Metaverse. However, sandbox (SAND) is up 77.8% year-to-date, outperforming BTC (+65.1%) and the broader crypto market (+50.0%). This morning, SAND was up 4.83%, after gaining 13.53% on Friday.

SANDUSD 180323 Daily ChartCongress Schedules Hearing on SVB and Signature Bank Shutdowns

On Friday, House Financial Services Committee Chairman Patrick McHenry announced the first hearing into the bankruptcy of Silicon Valley Bank and Signature Bank.

According to the announcement,

Patrick McHenry and Maxine Walters, a member of the House Financial Services Committee, announced a bipartisan hearing with federal financial regulators in response to the failures of Silicon Value Bank (SVB) and Signature Bank to be held on March 29, 2023 .

Martin Gruenberg, Chairman of the Board of the Federal Deposit Insurance Corporation (FDIC), and Michael Barr, Vice Chairman for Oversight of the Board of Governors of the Federal Reserve, are witnesses.

In a statement, McHenry said:

We work around the clock to provide answers to the American people to protect depositors, promote the safety and soundness of American banks, and strengthen our financial system. We will conduct this hearing without fear or favor to get the answers the American people deserve.

The hearing will undoubtedly generate a lot of interest. Crypto market players have come under increased scrutiny since the collapse of FTX.

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