Bitcoin hits 9-month high on relief trades; Binance still under pressure - News Time

Bitcoin hits 9-month high on relief trades; Binance still under pressure

By Geoffrey Smith — Bitcoin hit a nine-month high and cryptocurrencies rose across the board on Tuesday as concerns about the reserves held by digital platforms at troubled U.S. banks eased. 

Prices were also supported by signs that Binance was following through on its declared intention to convert its $970 billion ‘industry recovery fund’ assets into digital assets, a substantial shift in real demand for digital assets at a time when market liquidity has dried up badly, making outsize moves easier. 

By 11: 00 ET (15:00 GMT),


was up 16% at $26,084, while


was up 7.2% at $1,762.50. 

In the stablecoin universe,

USD Coin

regained its peg to the dollar as uncertainty over the fate of its reserves held on deposit at Silicon Valley Bank cleared. The Federal Reserve, which took over SVB late last week after a run by depositors, said on Sunday it would guarantee all deposits both at SVB and at Signature, another crypto-friendly bank, in order to stop wider contagion among traditional banks. 

“DeFi surviving its biggest existential crisis to date thanks to a timely bailout by the Fed was not something any of us were expecting,” Canada-based academic John Paul Koning said via Twitter.  

At the same time, however, signs of constraints on the crypto system continued to multiply, as regulators around the world moved to restrict the interaction between traditional and digital finance. Binance, the world’s largest crypto exchange, was forced to suspend sterling payments into and out of its network on Tuesday after payments company Safepay said it has stopped supporting sterling-based transfers. Binance, which has no license to operate in the U.K., has been warned in the past by the Financial Conduct Authority not to market its services there. 

That came a day after Coinbase (NASDAQ:


) said it would halt trading in

Binance USD

, a Binance-listed native token, after U.S. regulators ordered its sponsor, Paxos, to stop minting what they claim are unregistered securities. 

In the U.S., the closure of the SigNet payments network operated by Signature is being particularly sorely missed. This had operated as the main on-off ramp between crypto and fiat currency in the U.S. before Signature was closed, leaving few viable alternatives. 

One U.S. institution that is still offering services to crypto investors is San Francisco-based Mercury, which has stepped up its marketing since federal authorities took over SVB and Signature. Mercury, a fintech startup, uses its relationships with two federally-insured institutions Evolve Bank and Trust and Choice Financial Group – to offer guarantees on deposits of up to $3M, 12 times the regulatory threshold. 

Mercury CEO Immad Akhund said via Twitter at the weekend that “We have already onboarded 2x more customers today than we do on a normal weekday!”

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