NewsletterBitcoin (BTC) Already Priced In Genesis Bankruptcy News? What Next?
Bitcoin (BTC) News: Even as crypto lender Genesis Global filed for Chapter 11 bankruptcy protection, the Bitcoin (BTC) price is hardly impacted by the news. The continued strength around the current price level could be an inherent indication of the market already moving past the bankruptcy news. It may be recalled that the possibility of Genesis bankruptcy has been widely speculated over the last few months. Ever since FTX announced bankruptcy, it was almost as if Genesis was next in line.
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Interestingly, the recent relief rally with BTC price recovery since the beginning of 2023 is one of the longest such pump in Bitcoin history. The top cryptocurrency grew by as much as 27% compared to January 1.
U.S. Dollar – Bitcoin Correlation
Amid worries of a possible economic slowdown in the U.S., the US Dollar continues to remain at the seven month low level. Compared to the previous high of 114 in September 2022, the U.S. Dollar Index (DXY) is down by around 12%. Bitcoin (BTC) price has been maintaining an inverse correlation with DXY. In this context, the recent price rise of BTC is justified especially with no signs of a positive macroeconomic environment in near future. As of writing, the BTC price stands at $21,128 up 2.12% in the last 24 hours, according to CoinGape price tracker.
Genesis – DCG Scenario
Perhaps owing to the prolonged speculation around Genesis bankruptcy, the crypto market seemed to have taken into account the imminent news in context of the FTX collapse in November 2022. Genesis Global had on Thursday filed for Chapter 11 bankruptcy protection in the Manhattan federal court. This makes it tougher for the Digital Currency Group (DCG), which is looking for a potential buyer for its media company CoinDesk. In this context, the Grayscale Bitcoin Trust, which is also owned by DCG, is facing immense pressure with the GBTC discount now reaching 40.45%.
More importantly, it remains to be seen if the Genesis bankruptcy and possible worsening DCG crisis could lead to tougher regulatory stance from various governments.
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