Bitcoin prices rally above $26,000 amid banking crisis, Fed interest rate outlook
Yahoo Finance crypto reporter David Hollerith joins the Live show to discuss bitcoin's rally to its highest levels since June, what the upcoming Fed meeting could mean for cryptocurrencies, and a report Coinbase is exploring an alternative venue with clients overseas.
SEANA SMITH: All right, crypto resuming its rally, Bitcoin climbing above $26,000 for the second time this week. We're on track for the best week that we've seen in just over two years. We want to bring in David Hollerith to break down the action that we've seen. And David, it seems like investors are turning to crypto in a time when there's so much uncertainty.
DAVID HOLLERITH: Yeah, Seana. I mean, we saw Bitcoin begin to rise a lot yesterday. And this was around the time, you know, where the banking-- the US banking system-- or yeah, was getting sort of this infusion we were seeing with First Republic. And it's hard ever to figure out what exactly is driving the Bitcoin price. But it's continued that rally into today. And Bitcoin has been achieving new price highs, or sort of for the past couple of weeks. Obviously, the end of last year was pretty rough for it.
That being said, when the Silicon Valley Bank seizure happened exactly a week ago, we saw it plummet over uncertainty around how that might impact the market. And the industry in the US has had its two major banking partners close. So now at this point, it's at a very interesting point as stocks are also rallying, particularly technology stocks. So there's that. And there's a lot of-- there's sort of a growing camp of people who are looking at what's going on in the US banking system and trying to anticipate what the Fed might be doing from here on out. So that's in play, too.
But in general, this is a really interesting time to pay attention to Bitcoin as it was created, at least arguably, during the 2007 to 2009 financial crisis, and during that period, I mean, the idea was to create a currency and banking solution that was out of the reach of governments. And obviously, that's an interesting thing here because you can look at how Bitcoin may have benefited from the government stepping in to backstop some of these banks in a certain way if you just track it with the price. So it's a very interesting time.
I mean, I think that the thing that needs to be paid attention to is that Bitcoin is-- right now, it makes 46% of the total crypto market. And it hasn't achieved that high since June 2022. And during that time, crypto was sort of dealing with its own credit crisis. And that was seen as a flight to safety. And at this point, it doesn't seem like investors are scared as much. But it does seem like Bitcoin is rallying a lot more than the other coins.
SEANA SMITH: And Dave, crypto-related stocks-- Coinbase is reportedly in talks with clients about a new overseas venue. What's the significance behind this potential move?
DAVID HOLLERITH: Yeah, using three unnamed sources, Bloomberg put the story out today. And this is basically that institutional clients were said to be approached by Coinbase for potentially doing what we would consider in the US to be an offshore trading venue. An international expansion for Coinbase has been something they've been doing for years. Like Robinhood, for example, which is trying to launch in the UK by the end of the year, they've made that commitment. These companies, their mission is, in so many words, to democratize finance.
And that's really only achieved by going all over the world, especially in places where banking or local currencies aren't hitting the mark as much. But Coinbase, obviously, is dealing with a few other things. It's already in 100 countries. So this is different in that they're talking about creating an actual different operating entities, what it sounds like from the information we have. Obviously, it's not really been extrapolated for us by Coinbase. They've declined to comment. But we'll want to pay attention to this, especially in light of the fact that US regulatory crypto legislation has not really been moved forward, and it has progressed in other countries such as in Europe and Asia.
SEANA SMITH: Coinbase is up 12% right now, up 43% over the last five days. David Hollerith, thanks so much for joining us.