Bitcoin Soared Above $28K After UBS Agreed to Buy Credit Suisse
Switzerland’s largest banking institution – UBS Group – entered into a merger deal with its troubled rival – Credit Suisse. The former will pay $3.25 billion to finalize the deal, which is 60% less than what Credit Suisse was worth at the end of last week.
Bitcoin reacted positively to the news, surpassing $28,500 for the first time since June 2022.
The Rescue Deal
The Swiss banking behemoth Credit Suisse revealed significant operational issues in the past few weeks, prompting Switzerland’s central bank and the local financial regulator to step in.
UBS responded to the intervention, agreeing to acquire Credit Suisse for $3.25 billion. Under the terms of the agreement, all shareholders of Credit Suisse will receive 1 share in UBS for 22.48 shares in Credit Suisse.
The ailing bank will continue conducting its business as normal until finalizing the merger deal. Moreover, the Swiss National Bank will allow it access to facilities that offer substantial additional liquidity.
“Given recent extraordinary and unprecedented circumstances, the announced merger represents the best available outcome.
This has been an extremely challenging time for Credit Suisse, and while the team has worked tirelessly to address many significant legacy issues and execute on its new strategy, we are forced to reach a solution today that provides a durable outcome,” Credit Suisse’ Chairman of the Board of Directors – Axel Lehmann – commented.
Interestingly, Tron’s Founder – Justin Sun – also displayed his ambition to purchase the bank, offering $1.5 billion. He vowed to integrate it into the Web3 universe, praising Switzerland as one of the most crypto-friendly destinations globally.
BTC Keeps Rising
The primary cryptocurrency spiked to a nine-month high, tapping $28,500 (CoinGecko data), shortly after Credit Suisse revealed the merger details.
Amid this global banking calamity, bitcoin’s price has skyrocketed lately, being up nearly 70% since the beginning of 2023.
The asset seems inclined to thrive in such occasions when some of the world’s largest banks are experiencing massive issues. After all, bitcoin was created during the last massive financial crisis caused by banks, many of which failed and had to be bailed out again.
Recall that Silvergate Capital, Silicon Valley Bank, and Signature Bank disclosed operational difficulties, triggering regulators to close them down. SVB – one of America’s top 20 banks prior to its downfall – even filed for bankruptcy protection last week.
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