This has somewhat shoved the potentially pivotal happenings of the Brexit saga to the rear. However, many analysts and crypto/Blockchain stakeholders are of the belief that UK’s departure from the EU could have a profound effect on the price of Bitcoin and other cryptocurrencies.
This is based on the possibility of negative ramifications to the United kingdom’s economy. The manifestation of these expectations is likely to worsen in the event of a no deal separation, which seems more likely under the guidance of Prime Minister Boris Johnson.
According to experts, one of the main concerns here is shortages in the variety of foods, coupled with a predicted increase. Though no one can say for certain at this point, many are waiting in anticipation of an increase in the cost of cross border trade between the UK and her biggest partner, the EU.
How Could This Effect Cryptocurrency?
At the time of writing, the Pound Sterling was trading at $1.24 to the US dollar. According to Nigel Green, founder of deVere Group, the Pound had lost roughly 4.5% over the course of July and August on the back of Johnson’s government moving steadily towards a no-deal exit from the EU.
“Should the UK leave with no-deal, the pound is likely to remain weak for several years until the country and the EU readjusts.” He added as he spoke to DailyExpress.
The man behind the world’s largest financial advisory firm, Mr Green, made an assertion in July that cryptocurrency and Blockchain friendly regulation could play a pivotal role in reinvigorating the UK’s economic situation after its exit from the EU.
“How, then, to reshape and reinvigorate UK financial services in a post-Brexit era?”
“A major part of the answer must be cryptocurrencies.” He added.
Green is not the only one with a similarly bleak outlook regarding the foreseeable future of the pound. CEO of Blockchain firm, CommerceBlock, Nicolas Gregory believes that the resulting volatility will only serve to cement the recent sentiments around Bitcoin’s use as a safe guard against economic uncertainty.
“And if central banks revert to ramping up the money printing all over again, the case for cryptocurrencies like Bitcoin whose supply is capped will be further reinforced.” Reported the Independent.
Though the pound may not be at risk of total collapse, countries like Turkey, Venezuela, Argentina and recently Brazil seeing record highs for cryptocurrency trading as their economic situations deteriorated. Argentina, for example, has an inflation rate that is higher than 30%. Exchanges in the country have reported higher trading volumes that have correlated with the their Peso’s loss of momentum.
Should the predicted fallout of a no-deal Brexit come to pass, the likelihood of an uptick in the demand for Bitcoin and other cryptocurrencies seems positive. The post Brexit scenario could also present an opportunity to revamp the regulatory landscape, as the UK would no longer be bound to the EU’s regulatory processes.