Establishment of support or end of the “great” upswing? Decisive week for the “banking crisis
Thought of the week
High key interest rates, which are slowly approaching peak levels, are causing global problems and turmoil in the financial sector.
This illustrates how fragile and ramified this industry has become. A domino effect has only been achieved through the best efforts of governments and dubious “debt takeovers”. What is clear here is that digital assets and the blockchain technology industry cannot aim for a changing of the guard or establish a “better” system, but the use of the technology in the traditional financial system could provide optimization, efficiency and transparency.
Digital Asset News
The adaptation of digital assets is progressing: Deutsche Wertpapier Service Bank wants to make cryptocurrencies available to 1,200 partner banks.
Deutsche WertpapierService Bank (Dwpbank), which as a transaction bank mainly carries out securities settlement for banks in Germany, wants to launch its own crypto platform called wpNex in the second half of the year for all customers of its affiliated partner banks.
In the new service, customers’ crypto accounts will be managed as normal alongside their other existing accounts, so no additional data is required to use the service.
Nasdaq plans to launch crypto custody from the end of the second quarter.
The planned service would be the stock exchange’s first major foray into the digital assets market, which could give it a significant boost to its beleaguered confidence. Accordingly, as Bloomberg reports, the exchange has filed an application for a limited-purpose trust company licence with the New York Department of Financial Services (NYDFS), which would be responsible for overseeing the new service. Ira Auerbach, the vice-president and general manager of Nasdaq Digital Assets, had revealed the plans to that effect in an interview in Paris this week, stressing that the exchange wants to ensure that all necessary regulatory approvals are obtained and the necessary technical infrastructure is put in place.
While Bitcoin has not yet given up its recent gains, or is only experiencing a minor correction, the banking crisis is now spreading to the Deutsche Bank share. The market-leading cryptocurrency had tried to establish support in the higher range after the upswing on 23 March, which was largely caused by the announcements on the further monetary policy of the US central bank.
The Federal Reserve had raised its key interest rate by another 0.25% on 23 March, with central bank chief Jerome Powell subsequently sending mixed signals that have quickly become an advantage for risky investment products. Furthermore, concerns are intensifying with regard to the ongoing banking crisis, as after Credit Suisse suffered massive losses a few days ago, Deutsche Bank is now being hit hard.
“Bank stocks are plummeting, bonds are plunging, precious metals are going up, bitcoin remains flat,” as Daan Crypto Trades sums up the situation. And further:
“Looks like traditional finance is still on the way down, now we have to wait and see if BTC has any room to go.”
At the time of going to press last week, the Deutsche Bank share was already down almost 10 %. Although there is currently no reason to panic, this major loss of confidence in the banking system signifies a fundamental growth in digital assets.
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