Cryptocurrencies surged on Tuesday, with Bitcoin reaching its highest level in nine months as concerns about reserves held by troubled US banks eased.
Binance’s conversion of its $970 million recovery fund assets into digital assets also supported prices, creating real demand for digital assets at a time when market liquidity has dried up.
By 11:00 ET, Bitcoin was up 16% at $26,084, and Ethereum was up 7.2% at $1,762.50. USD Coin regained its peg to the dollar as uncertainty over its reserves held at Silicon Valley Bank cleared after the Federal Reserve guaranteed all deposits at the bank and at Signature to prevent wider contagion among traditional banks.
However, regulators around the world are increasingly moving to restrict the interaction between traditional and digital finance.
Binance suspended sterling payments into and out of its network after payments company Safepay stopped supporting sterling-based transfers.
Coinbase halted trading in Binance USD after US regulators ordered Paxos to stop minting what they claim are unregistered securities.
The closure of the SigNet payments network operated by Signature left few viable alternatives in the US, but Mercury, a fintech startup based in San Francisco, is still offering services to crypto investors, using its relationships with federally-insured institutions Evolve Bank and Trust and Choice Financial Group to offer guarantees on deposits of up to $3M.
