The U.S. banking crisis has made more people appreciate having crypto as an alternative, according to the Coinbase researcher.
“Overall, we believe the medium to long-term outlook for cryptocurrencies has been reinforced to the upside. The technology behind open, trustless blockchains and transparent smart contracts stands in stark contrast to the poor risk management practices that led to the turmoil witnessed in the U.S. banking sector this week,” the researcher stated.
The banking crisis also stretched into European markets, with Credit Suisse, Switzerland’s second-largest bank,its breaking point. Interestingly, as the turmoil continues, the crypto sector has seen notable growth, which Duong partly attributed to technical reasons. “For its part, cryptocurrencies have exhibited some resilience, in part due to technical reasons. But also, we believe more people now appreciate the fundamental value proposition of having an alternative to the points of failure inherent in the traditional financial system,” he added.Furthermore, the Coinbase researcher mentioned that the chaos could lead the Federal Reserve to make monetary policy decisions affecting financial markets.
Meanwhile, Duong disclosed that Coinbase had recorded increased institutional crypto purchases in the past few weeks. Traditional and crypto-native hedge funds, private wealth entities, and traditional asset managers are positioning for the Fed to return easy money policies that drove the last bull run.
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