Credit Suisse Facing Lehman-Like Moment rings Attention to Bitcoin – Crypto News – Crypto News
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Credit Suisse Facing Lehman-Like Moment rings Attention to Bitcoin – Crypto News

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2 years ago

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Another Lehman-like moment is brewing up in the banking space with Swiss banking giant Credit Suisse being at a “critical” moment now. Credit Suisse Chief Executive Officer Ulrich Koerner said that the bank is preparing for the latest overhaul and has asked investors less than 100 days for a turnaround story.

The Swiss bank’s credit default swaps ie the cost of insuring the firm’s bonds against default jumped 15% last week to levels not seen since the 2009 Lehman crisis.

Along with Credit Suisse, Deutsche Bank is also assumed to be in a similar situation. The asset base of these two European banks combined is $2.5 trillion which is four times the asset base of the Lehman brothers during the time of its collapse.

As we see history could be repeating itself, global investors are driving their attention once again to Bitcoin as a safe haven. The decentralized cryptocurrency was created after the Lehman collapse to insulate investors from the global banking institutions and global markets.

While the global market has been showing massive volatility last week, Bitcoin surprisingly remains rock solid. As of press time, Bitcoin is trading at $19,200 with a market cap of $367 billion.

If Credit Suisse really goes the Lehman way, it could probably serve as a massive boost for Bitcoin and crypto over the next decade.

Bitcoin or Gold?

Commenting on this latest development, Barry Silbert, founder of Digital Currency Group, the parent firm of Grayscale Investments, wrote: “Bitcoin is about to become the safe haven asset. Nowhere else to hide”.

Bitcoin critic Peter Schiff was quick to respond to it stating that it would be prudent to buy Gold and drop Bitcoin. He wrote,Where do you hide from The Grayscale Bitcoin Trust? It’s down 80%. Why would Bitcoin suddenly become a safe haven asset if it has never been a safe haven in the past? If you want a proven safe haven drop #Bitcoin and buy #gold”,

But Bloomberg’s senior commodity strategist Mike McGlone recently said that both Bitcoin and Gold can outperform over the next decade looking at the current macro scenario. He added: “The most central banks in history hike[d] rates with the world tilting toward recession. Lower commodity and risk-asset prices may be the only way out with deflationary implications, which should buy the price of gold and its digital version, Bitcoin”.

Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explores his culinary skills.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

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