The Breakdown, With NLW: Why We’ll Remember This Banking Crisis as a Turning Point for Bitcoin
Cryptocurrencies are a relatively new asset. The first crypto, Bitcoin, was launched in 2009. It was created based on a white paper written in 2008. So from the start, it’s clear that the space has evolved out of concerns over the banking system.
Today, that system is at risk of a meltdown again. As that risk has weighed on investors, cryptocurrencies like Bitcoin have perked up instead.
This crisis is still in its early stages. But the collapse of three banks within a span of days raises concerns over the safety of the legacy financial system.
Cryptocurrencies have started to see widespread adoption in the past few years, partially as a speculative investment. And the froth has come off in the past year as crypto prices have tanked. Yet those that serve a purpose are likely to continue to grow their network size and value over time.
Even central bankers have taken notice. A few of the world’s central banks have started to create pilot projects using crypto technologies like blockchains to create their own central bank digital currencies (CBDCs).
Given that the current legacy financial system is prone to locking up, or having fearful drops and liquidations, cryptos may still yet be a solution to that perennial problem.