Brewing Banking Crisis Sparks Renewed Optimism for $1M Bitcoin Price Target

Bitcoin bulls are back with renewed optimism as the instability in the banking sector intensifies.With Bitcoin's current price range showing a reccurring resistance level, the market is eager to see what it will do with possible shifts in monetary policy.

Regional Banking Struggles Mirroring 2022 Chaos.

Almost one year after the collapse of Signature Bank and other regional lenders, history seems to be unfolding again.

Recently, the stock price of New York Community Bancorp (NYCB), a company that bought the failed Signature Bank last year dropped by 30%. Its valuation is now at 1990s levels, sounding alarms of another impending banking crisis.
 

The CEO of Into the Cryptoverse, Benjamin Cowen, pointed out that NYCB’s valuation has declined to 1997 levels.

This year, the Federal Reserve’s Bank Term Funding Program that was meant to provide liquidity for struggling banks will end soon. The parallels to 2022 banking turmoil are increasingly becoming obvious.

Bitcoin Bulls Predict $1 million Price Amid Crisis 

As the echoes of the last year’s banking crisis reverberate again, crypto leaders such as Arthur Hayes are  more bullish with Bitcoin price forecast.

The former BitMEX CEO sees BTC falling to $30,00 by March as these regional banks collapse for the second time. But he predicts a repeat of 2022’s blueprint where Bitcoin rallied on money-creation and an escalating economic crisis.

Hayes continues to insists on his forecast of $1 million per Bitcoin, pointing out that the path from “junk” to bankruptcy for many banks could result in some very serious money creation by the Fed.

Bitcoin often performs incredibly well when there is a lot of macroeconomic turmoil as investors treat it like an alternative to gold for safety during such times. During such period of economic uncertainty, a flight to Bitcoin is regarded as a flight to safety and quality. 

The price action of BTC remains stable.

At present, Bitcoin's price action remains largely unmoved by the brewing instability in the banking sector. BTC has been trading in a verifiable daily range of above 150 days till date without any sign indicative of the major breakout.

Although macro factors such as stock implosion in China and NYCB’s crisis can ultimately affect Bitcoin, for the meantime it is calm.

But if Hayes is right and the instability of regional banking leads to an even greater acceleration, then volatility similar to what we saw in 2022 may be coming our way again.

Currently, Bitcoin seems to be pretty happy with the status quo and awaits a stronger macro catalyst before staging substantial moves. Its response to any move from the Fed in future weeks could determine price behavior.

Monitoring Bitcoin's Response to Policy Changes 

Many Bitcoin bulls are betting that the weakness in the banking sector could give rise to a kind of monetary policy response which hit BTC and drove it upwards last year.

On the other hand, Bitcoin remains rather calm for now despite giving in some =echoes of 2018 regional banking crisis.

 The Fed’s pending policy response and Bitcoin’s reaction to it will likely hold the keys for any future price action that may bestow a pathway towards $1 million.