Credit Suisse and Deutsche Bank in trouble, what does this mean for bitcoin?

Last Updated: 3 October 2022

The macroeconomic storm has all but subsided recently and bitcoin is still sailing in extremely troubled waters. Remarkably, bitcoin is still holding up quite well in all the macro violence, especially compared to traditional financial assets. The big question is whether bitcoin will manage to stay afloat if the waves get even higher.

“We can’t go down much further”

You’ve no doubt heard about Swiss investment bank Credit Suisse being on the verge of collapse. Credit Suisse is a bank that has been put on a list of so-called systemic banks by the Financial Stability Board. This means that Credit Suisse is a bank that will pull the entire financial system with it if the bank collapses.

In that sense, the world has a lot to gain from Credit Suisse being able to prop itself up or with help. Fifteen years after the fall of Legman Brothers in 2008, another critical moment for the global economy now seems to be looming.

The entire financial world is heading towards the abyss at a time when inflation is going through the roof, we have to deal with a war in Ukraine and financial assets are experiencing their worst year in ages.

Incidentally, not everyone is negative. According to Samson Mow, this scenario could very well turn out to be very favourable for bitcoin. “Even if Credit Suisse or Deutsche Bank collapse and cause a financial crisis, I don’t see us going much lower,” said an optimistic Samson Mow.

Not everyone positive about bitcoin

Incidentally, not everyone shares Samson Mow’s view that this is a positive development for bitcoin. Henrik Zeberg, a popular macroeconomist on Twitter, predicts “the biggest deflationary crash since 1929.” Which means a lot of “air” will flow out of the markets, according to this economist.

In early 2023, he expects another rally in the dollar, which should take the Dollar Index to around 120. That should eventually trigger a crash bigger than those of 2007 and 2008.

Recently, the dollar has fallen back slightly, but according to Zeberg, it is mainly a matter of “catching one’s breath” for the world reserve currency for a while. After that, the dollar will continue its advance, according to this analyst, and that will almost have to come at the expense of bitcoin.

  • Gabriele Spapperi

    Gabriele Spapperi is a veteran cryptocurrency investor and blockchain technology specialist. He became fascinated with Bitcoin and distributed ledgers while studying computer science at MIT in 2011.

    Since 2013, Gabriele has actively traded major cryptocurrencies and identified early-stage projects to invest in. He contributes articles to leading fintech publications sharing his insights on blockchain technology, crypto markets, and trading strategies.

    With over a decade of experience in the crypto space, Gabriele provides reliable insights and analysis on the latest developments in digital assets and blockchain platforms. When he's not analyzing crypto markets, Gabriele enjoys travel, golf, and fine wine. He currently resides in Austin, Texas.

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