Digital Gold Bitcoin Booms as Traditional Financial System Falters22. March 2023
• The exchange rate between Bitcoin (BTC) and Ether (ETH) has been falling in recent weeks.
• This is due to Bitcoin’s performance outperforming most other cryptocurrencies amid a “safe haven” bid as cracks form in the global banking system.
• Bitcoin is often referred to as “digital gold” and is seen by many investors as a safe haven asset, while Ether is also viewed as robust and decentralized.
Decline of ETH/BTC Exchange Rate
The exchange rate between Bitcoin (BTC), the world’s first and largest cryptocurrency by market capitalization, and Ether (ETH), the world’s second-largest cryptocurrency by market capitalization that powers the Ethereum blockchain, has fallen rapidly in recent weeks.ETH/BTC was last changing hands on Binance (as per TradingView) around 0.0625, down around 15% from earlier monthly highs in the 0.0735 area and at its lowest level since July 2022.
ETH/BTC’s downside isn’t a result of Ether performing poorly. On the contrary, at current levels in the $1,750s, Ether is up just shy of 10% this month and is up over 27% versus earlier monthly lows under $1,400.
The problem for Ether is that it, like most other cryptocurrencies, hasn’t been able to keep pace with Bitcoin. Bitcoin has been leading a charge higher in cryptocurrency markets amid what analysts have referred to as a “safe haven” bid as cracks form in the global banking system.
Safe Haven Assets
Financial Stability Concerns Disproportionately Benefit Bitcoin After three major regional US banks went under earlier this month, Credit Suisse was bought out by Swiss rival UBS over the weekend. Meanwhile, a consortium of US banks came together last week to provide a $30 billion bailout for US bank First Republic. Despite efforts from authorities to calm the situation, investors remain on edge that more banks might be about to go under., which many view as the ultimate haven..But Bitcoin , which many refer to as “digital gold”, is increasingly viewed as a safe haven asset after all it’s highly robustness ,highly decentralized payment system operates entirely separately from traditional financial system .
Ether Benefits Too
Ether can also make same claim towards being robust ,decentralized independent of traditional financial system .Given its smart programmability it arguably goes beyond bitcoin allowing an independent decentralized finance ecosystem built directly onto itself .