JAKARTA - A number of banks linked to the cryptocurrency business have reportedly failed recently. Crypto-friendly banks continue to fall, such as Signature Bank, Silicon Valley Bank, and Silvergate Capital.
The closure of these banks raises concerns among crypto users and invites various reactions, including from Turkey-American economist Nouriel Roubini.
According to a U.Today report, Nouriel Roubini, who is known to be controversial for predicting the 2008 financial crisis, has warned the public about the dangers of investing in crypto. Roubini calls investing in crypto a "dangerous and unstable investment." This certainly has an impact on banks dealing with cryptocurrencies, which he considers putting themselves at risk.
In a tweet reported on Monday, Nouriel Roubini laughed at the collapse of several crypto-related banks. "All banks doing the crypto business are collapsing. Good release," he wrote. The comments show his belief that a wider market for cryptocurrencies will collapse.
The failure of Signature Bank, a New York-based financial institution, is also in the spotlight. The bank has total assets of around 110.36 billion US dollars (Rp1.7 quadrillion) and total deposits of around 88.59 billion US dollars (Rp1.3 quadrillion) at the end of December 2022.
This bank has become the largest banking institution to offer cryptocurrency deposits. With the closure of the bank by state regulators on March 12, 2023, Signature Bank became the third largest bank to fail in the US.
Nouriel Roubini's reaction to the failure of these cryptocurrency-related banks is in the spotlight. Roubini predicted that the entire cryptocurrency industry would be "extinction" due to the high risk involved and warned that other leading crypto companies were at risk of bankruptcy. "Don't believe in hype," Roubini said in an interview on CNBC. "This will be the largest speculative bubble in human history."
Although Nouriel Roubini's trust in investing in crypto is controversial, the failure of crypto-related banks has shown great risks in the industry. Along with the increasing use and popularity of crypto, the challenges and risks involved are also getting bigger.
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