The US Federal Reserve raised the benchmark interest rate by 0.25% and indicated that more rate hikes could follow in its fight against inflation, even though the higher rates triggered a series of bank failures.. Now the rate stands at 4.75%-5%, the highest since 2007.
According to them, “the banking system was solid and resilient.” Following the collapse of Silicon Valley Bank and Signature Bank, Treasury Secretary Janet Yellen told the Senate that she is not considering any plans to guarantee all bank deposits without congressional approval. Naturally, Such a comment caused a fall in the stock market and a fall in the shares of regional banks.
“I am very concerned,” said Maine Republican Sen. Susan Collins. “It seems to me that, by guaranteeing all the deposits [en SVB], a situation is created where they are immune to loss…in a way that puts a well-managed bank at a competitive disadvantage. So I guess my question to you is, how is this fair?
Like it or not, banking is not a matter of “fairness.” It is a matter of trust. The depositor does not ask: “How is this fair?” The depositor is actually wondering at this point: Is my money safe? The answer to this question can make the difference between a banking crisis and a banking system out of the woods. And we must remember that during a banking crisis the just pay for sinners. Is it fair to let the whole house burn down to punish a few?
In this case, pragmatism is wise. The lesser of the bad is chosen to avoid a bigger problem. What dogmatic debates do is hinder the work of the authorities. Remember the debates in Congress during the previous banking crisis? They delayed everything. To finally do what should always have been done from the beginning.
Coinbase, the cryptocurrency exchange, has received a notice from the Securities and Exchange Commission (SEC), the main financial regulator in the United States, warning it of possible violations of securities law. Coinbase shares fell more than 15%.
A stronger dollar during a banking crisis? Yes. During such a crisis, people become more conservative. They don’t take as many risks as before. And they save their money. Where? In the largest and best regulated banks. And the gold? And bitcoin? They have also benefited.
Now, let’s talk about the top crypto news of the week according to Cointelegraph in Spanish. This is not a news summary. This is an opinion article. The intention is to reflect on the following headlines in a skeptical and critical way. This is an article for free thinkers.
Crypto assets will be a separate category on UK tax forms
Defining and categorizing is not easy. The new does not always fit into the old frames. Comparisons are rarely exact. Which represents a huge problem in legal matters. What are cryptocurrencies? Coins? Assets? Goods? collectibles? We well know that cryptocurrencies do not easily fit any of these definitions. If a term is chosen, we must immediately clarify how different cryptocurrencies are from the other instruments under the same term. In this sense, words matter a lot.
A word is an identity. And the general recognition of this identity has implications at many levels (legal, social, economic, etc.). The problem is that identity is not something that is chosen unilaterally. Ultimately, identity is a social convention. You don’t define yourself. Symbolic systems are collective agreements. Language, for example, is a collective effort. We all speak using each other’s words. If we all suddenly start talking using our own words, communication with others would be impossible. In other words, the crypto community does not have the last word on what cryptocurrencies are or are not. The authorities will decide for us.
The European Parliament votes on the final law on the EU digital wallet
Who imposes the rules of the game? In democratic systems, “citizenship”. In authoritarian systems, the “great leader.” In laissez-faire capitalism, the free market. How represented is the individual in all these systems? What power of decision does the singular person have? Actually, the power of it is very little. Almost nil.
In Argentina, the inflation effect forces the Central Bank to raise interest rates
And the tax policy? Inflation is a multifactorial phenomenon. If we have capital flight, little investment, low productivity and, additionally, huge public spending, the increase in the cost of credit does not do much to reduce demand. The decisions of the Central Bank are not so decisive. The Venezuelan case, for example. Credit issued by private banks is practically non-existent. Lowering or raising rates is practically irrelevant. However, inflation is through the roof due to gigantic public spending in the context of a destroyed productive apparatus.
Venezuela reorganizes the national cryptocurrency department
In Venezuela, these “reorganizations” are our daily bread. There is no continuity of any kind. Everything changes. Little is maintained. Departments are created. Departments are removed. A director is put. The director is removed. Efforts are often diluted by so much bureaucracy, politicking, and cronyism.
Breaking: Do Kwon, the co-founder of Terraform Labs, has reportedly been arrested in Montenegro
At last! And I think it’s great. Among so many problems, we had already forgotten about the collapse of Terra/Luna. But there are things that cannot go unpunished. The best thing for everyone is for the courts to do their job. Much money was lost. There are too many mourners. And blaming the victims is not the way. The Spartan ethic promoted by free-market radicals doesn’t help much. Here the perpetrators are not the victims. Who are responsible? Well, determining that is now up to the courts. Innocent until proven guilty. But what pays who has to pay. A market without justice can never be free.
Disclaimer: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information presented here should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.
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