Will Brexit affect the price of Bitcoin?
If Brexit happens it will undoubtedly upset the world markets - predictions are that the pound will fall, as well as stock markets. There are even some predictions that the housing market will drop as buyers defer buying and wait to see what the economic outlook will be like. But will Brexit affect Bitcoin's price?
In my opinion, no it won't. The reason for this lies in the nature of Britain. This is a country with a Parliament that has been sitting continuously since 1295. The currency dates from Anglo-Saxon times (it is thought King Offa of Mercia introduced it in the 8th century AD). The central bank, the Bank of England, dates from 1694.
The whole thing has been going so long that your ordinary Brit has the utmost confidence in their currency. There won't be any attempts to hedge a possible fall in sterling by an ordinary household - instead they will deal with it by adjusting behaviour (buying fewer foreign things, going on fewer foreign holidays). It is unthinkable that capital controls will be applied. And it is entirely possible that exiting the European Union and making trade deals elsewhere will strengthen the UK economy. Escaping the European Union, with it's draconian rules on confiscating savings to bail out troubled banks, should increase the ordinary person's confidence in sterling.
So while Bitcoiners are undoubtedly fascinated by what is going on in Britain, don't expect Brexit to affect cryptocurrencies at all.
IMO the chief drive of the bitcoin price at the moment is China, because Chinese citizens are genuinely afraid of their government (and especially afraid of their government's crackdown on "corruption" which sometimes means simply targeting people with wealth). Fear tends to be the big driver of money into bitcoin (see the Cyprus crisis of 2013), and there is no such fear in Britain.
Well, there is something in between. It's called bitGBP, a market-pegged asset on the BitShares blockchain with the stability of the GBP and the advantages of blockchain technologies!
Do many people use bitGBP - has it been advertised to the British community? If not, Brexit won't have an effect on it...
We would like to advertise it to the British, but we need some liquidity first .. getting that liquidity is more difficult than I thought
Well you'd better get a move on, the referendum is on June 23rd, in just a weeks time...
How do you know it isn't already moving the Bitcoin price? All turmoil can be used to pump BTC.
Think back to Cyprus, was there really significant volume coming from over there? Speculators gonna speculate, and narratives conspire with price to extremes.
Agree! And you may be right on the other points as well, just never underestimate the power of largely illusory narratives to conspire with price.
Because all the movement in Bitcoin's price has come from the Chinese exchanges. The British bitcoin services like Coincorner, haven't seen much volume at all. The bitcoin/GBP pair hasn't seen much volume either. All the action is in BTC/CNY...
Wasn't there some discussion a few weeks before about a fusion of the London and Frankfurt exchange with headquarters in London? If GB will exit EU, Europe would be without any major exchange, wouldn't it?
London is the centre of global trade - so the Brent crude market, the commodities exchange, the metals exchange and so on most of which has nothing to do with European trade. I doubt any of that would move to Frankfurt especially as the EU is quite "anti-capitalist" and Britain outside the EU can be as free-wheeling as it likes.
An Artcile just to clear any doubts , like your view point
Excellent post and analysis. It turns out you were right and the 'Project fear' establishment were wrong.