repetition of 2008 crisis and what it means for bitcoin

[BrewMaster]

back in 2008 when the financial crisis was going on and the banking system was failing like dominoes we saw bitcoin rise from those ashes with these words:
The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.

- in 2022 we have been seeing the same thing.
- the inflation rate went up a lot.
- to control it the governments decided to increase the interest rate.
- it could only slow down the rise of inflation rate and caused recession.
- the banking system started failing again.

the high interest rate means people with debt (which is the majority of population) were forced to pay back more money to the banks which meant they had less and less money to spend on anything else hence starting the recession. the recession that decreased the revenues of a lot of companies like in the tech field and like a chain it affected the banking system too.
this is why we saw the Silicon Valley Bank collapsed catastrophically, the second-largest failure of a financial institution in US history.
this is also why another bank, Signature Bank also failed catastrophically. a bank that shows another failure in the real estate and mortgage market just like 2008.
this is also showing up in the stock market as the stocks of these companies are dumping hard.

this is all too familiar, the repetition of 2008 but with some differences. this time China is not bailing US out buy purchasing its debt, in fact China may even dump the US bonds she has putting more pressure on US economy with its even increasing debt. the Dollar is also getting weaker since unlike 2008 the petrodollar is not dominating the world anymore. the energy price is also still high contributing to the inflation.
but the increasing recession, interest rate and unemployment is all the same.

so, what does this all mean for bitcoin?
bitcoin was born out of the financial crisis, we could even say it was created because of it so that people have a sanctuary they can flee to.
when we look at the charts we can see that during the time the banking mess has been going on and as they kept collapsing, bitcoin price keeps on rising. in fact it broke a major resistance at $25k which it couldn't break before thanks to the banks collapses.

i believe the more banks fail, the more bitcoin price is going to shoot up.
this year we could see much worse financial crisis and a much bigger bitcoin price rise in one of the biggest FOMOs that bitcoin has seen so far.

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[pawel7777]

bitcoin was born out of the financial crisis, we could even say it was created because of it so that people have a sanctuary they can flee to.
when we look at the charts we can see that during the time the banking mess has been going on and as they kept collapsing, bitcoin price keeps on rising. in fact it broke a major resistance at $25k which it couldn't break before thanks to the banks collapses.

i believe the more banks fail, the more bitcoin price is going to shoot up.
this year we could see much worse financial crisis and a much bigger bitcoin price rise in one of the biggest FOMOs that bitcoin has seen so far.

The problem is Bitcoin's price (in recent years) was strongly correlated with traditional stock markets, and Bitcoin reached its ath in a very low-interest environment.
It's way too soon to be opening a bottle of champagne to celebrate success, as it is yet to prove that the correlation has been broken and Bitcoin's price is independent of other markets.
Also, the recession hasn't even started yet.

[ancafe]

-Snip- i believe the more banks fail, the more bitcoin price is going to shoot up.
this year we could see much worse financial crisis and a much bigger bitcoin price rise in one of the biggest FOMOs that bitcoin has seen so far.

I remember very well how the Bitcoin process in 2019 to 2021, Pandemi, Recession and Inflation really destroyed the economy of many countries, but strangely Bitcoin reached the peak of its ATH at that time and that's why the correlation is a bit reasonable in my opinion.

I agree if it is said that Bitcoin is able to maintain the quality of its value during a recession and inflation, because we have seen this when the world economic conditions are chaotic and the financial crisis has hit. But it does not have the power to say this year will be repeated like 2021 and the price of Bitcoin does not depend on other markets for now and is reflected in the movement of traditional stocks that we see as it is today.

[Baofeng]

bitcoin was born out of the financial crisis, we could even say it was created because of it so that people have a sanctuary they can flee to.
when we look at the charts we can see that during the time the banking mess has been going on and as they kept collapsing, bitcoin price keeps on rising. in fact it broke a major resistance at $25k which it couldn't break before thanks to the banks collapses.

i believe the more banks fail, the more bitcoin price is going to shoot up.
this year we could see much worse financial crisis and a much bigger bitcoin price rise in one of the biggest FOMOs that bitcoin has seen so far.

The problem is Bitcoin's price (in recent years) was strongly correlated with traditional stock markets, and Bitcoin reached its ath in a very low-interest environment.
It's way too soon to be opening a bottle of champagne to celebrate success, as it is yet to prove that the correlation has been broken and Bitcoin's price is independent of other markets.
Also, the recession hasn't even started yet.

I think the good measurement stick is how big the next bull run will be, we have seen predictions like $180k++ in 2024-2025. So yeah, it might be early to say or to celebrated, but if FEDS are going to continue to bail out banks in the next year, then maybe we will see a massive bull run after the bitcoin block halving. And we have like 2 banks in US and then 1 in Europe at this point.

Regardless how many of them are going to fall though, Bitcoin is going to be the real winner because that's how it was born by Satoshi.

We've already seen a swing in prices, $27k right now, and maybe $28k will be the next goal, for March alone. Not saying that we are in a bull run already, but with what is happening globally, investors might be running to bitcoin to hedge.

[hatshepsut93]

Satoshi was working on Bitcoin for years before the crisis started. It's a coincidence that by the time Satoshi was able to release the code and start the network, the crisis was in full swing. If you read the white paper, it's clear that repalcing the financial system wasn't the main motivation behind Bitcoin - Satoshi just wanted to make private money that can't be intercepted, seized, blocked.

Bitcoin can be very bullish now because of the hype, but this bullishness will not be fundamental if it's driven by speculators who will later dump at a huge profit. If people were exiting fiat for good and holding BTC for long term, that would have been huge. But there's no sign that it's happening now.

[bluebit25]

Even myself before I don't make much distinction between cash assets and some stablecoins.
But now that I have gathered them in a single portfolio and converted them to BTC, like many people I am also skeptical of banks, and the risk of losing money is great. And what has happened so far is proving that I was doing the right thing at that time.
Looking at the event this time, I have more reasons to hodl btc. Just another reinforcement of faith.

[adaseb]

It’s hard to say exactly what will happen. During Covid, Bitcoin crashed alongside stock markets. Now it’s rising while banks are failing. So if it gets worse who knows what can happen, it can go both ways.

You need to understand that many institutions own Bitcoin. Even if Bitcoin doesn’t crash, their other assets will and they will need to sell Bitcoin to make their earnings look better. Same with retail. If someone loses their job, they will need to sell their Bitcoin to pay bills.

[Lucius]

~snip~
You need to understand that many institutions own Bitcoin. Even if Bitcoin doesn’t crash, their other assets will and they will need to sell Bitcoin to make their earnings look better. Same with retail. If someone loses their job, they will need to sell their Bitcoin to pay bills.

It is something like a double-edged sword, on the one hand, money leaves the banks and part of it probably flows into Bitcoin, and on the other hand, for some, the rise in the price of BTC may be a trigger to sell and thus try to compensate for the losses that will occur due to the more or less everything else loses its value. It is true that no one will hesitate too much to sell BTC if they do not see another way out, but we can hope that the demand for the same will also increase and that there will be no major crashes in the near future.

Realistically, the price of BTC is approaching where it would be if Kwon&Bankman didn't happen, which is somewhere around $30k.

[Minecache]

-Snip- i believe the more banks fail, the more bitcoin price is going to shoot up.
this year we could see much worse financial crisis and a much bigger bitcoin price rise in one of the biggest FOMOs that bitcoin has seen so far.

I remember very well how the Bitcoin process in 2019 to 2021, Pandemi, Recession and Inflation really destroyed the economy of many countries, but strangely Bitcoin reached the peak of its ATH at that time and that's why the correlation is a bit reasonable in my opinion.

I agree if it is said that Bitcoin is able to maintain the quality of its value during a recession and inflation, because we have seen this when the world economic conditions are chaotic and the financial crisis has hit. But it does not have the power to say this year will be repeated like 2021 and the price of Bitcoin does not depend on other markets for now and is reflected in the movement of traditional stocks that we see as it is today.

This is not true, when the covid pandemic happened, the government pumped money to save the economy. It can be said that the economy during the pandemic is disrupted but not yet a crisis, and the real crisis began in 2022, and it can also see bitcoin being hit hard in 2022 due to inflation and the crisis economy. We have nothing to prove that bank failures are a good thing for bitcoin, everything is just our speculation. It's too early to say anything, we need more time and data to confirm that.