Bitcoin is poised for a surge above $35,000 as another wave of the banking crisis puts extra strain on the Federal Reserve balance sheet in the United States. According to a Wall Street Journal story on April 29, the US government is likely to place First Republic Bank under FDIC receivership this weekend.
First Republic Bank is not the only bank under jeopardy; 4-5 banks are also facing billions of dollars in bank deposit withdrawals. The Fed must print more money in order to save cash-strapped banks on the verge of failure.
First Republic Bank Likely To Be Taken Over By FDIC This Weekend
According to the Wall Street Journal, the FDIC will likely take over First Republic Bank this weekend. Furthermore, following the government's closure, banks such as JPMorgan Chase & Co and PNC Financial Services are already planning to buy First Republic Bank.
First Republic's stock has been in free fall since Monday, falling more than 75% to $3.51 at Friday's market closing. FRC shares plunged 33% to $2.33 in after-hours trading.
According to some Wall Street analysts, First Republic Bank is not the last to fail, with government agencies predicting that four to five banks may fail in the following months. In March, JPMorgan and PNC attempted to prevent issues at First Republic Bank by providing a $30 billion deposit. However, the bank has been unable to prevent further withdrawals of deposits.
Bitcoin's Price Expected To Reach $30,000
The Fed has already printed about $400 billion in order to safeguard banks from failure. Despite the banking crisis, the Fed raised interest rates by 25 basis points in March, to 4.75%-5%. The Fed will publish its next rate hike decision on May 3, although Wall Street anticipates a pause.
The Fed will be forced to print more money as a result of the second wave of the banking crisis, forcing Bitcoin prices to rise towards $35,000.
BTC has been trading sideways over the previous 24 hours, with the price currently hovering around $29,500. The low and high for the day are $28,929 and $29,526, respectively. Furthermore, as traders await the Fed's monetary policy decision, trading volume has dropped by 31% in the last 24 hours.