Amid the banking crisis in the US, the price of Bitcoin set a new annual high this month. However, cryptocurrency lovers still have reasons to worry, because BTC liquidity has fallen to its lowest level in the last ten months. This is also a consequence of the closure of the SEN and Signet payment networks, previously managed by the Silvergate and Signature banks, respectively. Both banks have actively collaborated with large crypto companies, but due to their problems, the situation for the digital asset industry is also significantly worsening.

The head of Kaiko’s research department, Clara Medali, in an interview with Decrypt, spoke about what else could happen after a significant drop in liquidity. Here is the corresponding response.

Initially, a drop in liquidity helps prices rise, but then a sharp drop can occur. As soon as buyer activity weakens, anything can happen to the price.

That is, poor liquidity actually contributes to sharper growth when there are buyers. However, as soon as the situation changes, rates may rush down at the same speed.

Market depth for Bitcoin and Ethereum has dropped 16.12 and 17.64 percent respectively since the beginning of this month.

What was happening in the American economy the day before became the main topic of an unscheduled online meeting of the Financial Stability Oversight Council at the Department of the Treasury (FSOC). Treasury Secretary Janet Yellen was also present at the discussion.

The conference became known from a brief announcement by the Ministry of Finance. There are still few details on this topic, but it is already clear that employees of the Federal Reserve Bank of New York made a presentation on the state of the markets. Judging by the conclusion of the presentation, the experts came to an encouraging forecast. Here is a quote from  Cointelegraph.

The Council discussed current conditions in the banking sector and noted that although some institutions have been stressed, the U.S. banking system remains sound and resilient.