The Crypto Compass Issue #11

Hello Friends! 

What a rollercoaster ride we've been on lately, right? The world of finance has been shaken up by bank insolvency issues, but guess what? Bitcoin is making a comeback! In this newsletter, we'll have a friendly chat about the banks going belly up, Bitcoin defying expectations, and what the future might hold with the upcoming Fed rate rise. So, buckle up and let's dive in

Yikes! It seems like banks have gotten themselves into a bit of a pickle. A growing number of them are facing insolvency, which has caused some serious jitters in the financial world. This troubling trend can be blamed on a bunch of factors, like not-so-wise lending practices, short-term funding reliance, and the economic challenges left over from the COVID-19 pandemic. Whatever the cause, it's clear that the financial markets are feeling the heat, and the crypto world is getting a piece of the action.

With all this turmoil, you might have expected Bitcoin to take a nosedive. But, surprise, surprise! The flagship cryptocurrency is proving to be quite the resilient contender. Its decentralized nature and immunity to central bank policies made it seem like a safer option, so people started snapping it up, sending its price soaring.

The recent uptick in Bitcoin's price despite the ongoing macro uncertainty suggests that a bottom might have been formed. This is fantastic news for crypto enthusiasts, as it could signal the beginning of a positive price trend.

Now, we've got something interesting coming up on the horizon: the Federal Reserve is planning to raise interest rates. But, wait! There's might be a change of plans due to the bank insolvency issues. Just a couple of days ago, a 50bps increase was very likely. However, the market is expecting a lower 25bps, with a possibility of no increase at all (0bps).

This shift in the Fed's stance could have varying effects on the cryptocurrency space. Some investors might see it as a sign to buy the dip, while others may take a more cautious approach.

So, what's a savvy crypto enthusiast to do? Keep a close eye on market trends, stay informed, and remember that the crypto world has been through ups and downs before. We're a resilient bunch, after all!

Best, QH

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