Bloomberg: Bitcoin Successfully Passes Extreme Liquidity Stress Test

Bitcoin has passed a market stress test with flying colors

According to analysts at Bloomberg Intelligence. The data shows that investors' confidence in Bitcoin has grown, with the cryptocurrency successfully passing an extreme liquidity stress test during a US banking crisis.

The experts' research reveals that for a significant majority of cryptocurrency investors, Bitcoin remains a base asset that protects against major risks. The asset's market value has grown rapidly in the first quarter of 2023, and the trust in its network, based on hashrate, confirms analysts' conclusions about the potential dominance of Bitcoin as a global reserve asset.

Despite increasing turbulence in the cryptocurrency market caused by the record increase in Fed rates, a liquidity crisis in the US banking system, and subsequent depositor exodus, Bitcoin remained an attractive investment throughout the first quarter of 2023, with its value rising over 20%.

Against the backdrop of financial turbulence, Bitcoin has demonstrated its potential as a hedge against instability in the banking system, according to analysts.

"As central banks and regulatory authorities try to build trust in reserve-based banking, the Bitcoin network's decentralized and distributed nodes, miners, and users organically become thicker. Doubling the hashrate during the bear trend in 2022, combined with an exceptional start to 2023, is truly impressive," the Bloomberg Intelligence report said.

Bloomberg Intelligence also believes that the Bitcoin blockchain network has never been as secure as it is now. The significant increase in hashrate, which has risen by 25% since the beginning of the year, indicates that overall trust in the network is at an all-time high.

Experts at Bloomberg explain that hashrate refers to the computational power of the network used to process and verify Bitcoin blockchain transactions. The higher the hashrate, the more difficult it is for a single entity to control the network or manipulate transaction history.

(Source: Bloomberg)