When the price of a cryptocurrency rises as abruptly as it has for Bitcoin over the past few weeks, people seek the reasons for the market’s optimism. One large factor that has been suggested is the UK’s referendum regarding its membership of the EU on June 23.
Many news outlets have been discussing the all sorts of crazy scenarios, and it has been suggested investors as far as Asia are troubled by the ever-nearing vote. On June 10th a YouGov poll came out that had the LEAVE campaign with 3 percentage points ahead. On that same evening Japan’s Nikkei 225 index fell 0.4%, and Australia was hit hard with investors selling 0.9% more at the closing of the S&P/ASX 200 index.
On June 12th through 13th, 5 more polls came out from YouGov, ICM, TNS and ORB, all of which predicted a LEAVE win, and now with margins up to 7% in two of the polls. Instantly, the price of one Bitcoin hiked from around $583 on the 11th of June to $720, in just under 48 hours.
Global Council, and independent advisory firm has said, that in the five years after a potential Brexit, they would expect other EU countries to follow Britain, and also hold referendums which could mean at least ten years of uncertainty for the Pound, Euro, and the Swiss Frank, which would be hit by the reduced trading capacity of the European Block. We have seen this before. When investors are uncertain about fiat currencies, they turn to alternative assets, like gold, silver and in recent history Bitcoin.
With the halving approaching, Brexit polls worrying traders around the world, and Chinese buyers eager to get onto the cryptocurrency train, it shouldn’t come as a total surprise if we see Bitcoin continuing to rise to in the up coming weeks, which will certainly be supplemented by an active FOMO (fear of missing out) crowd.
Volatile fiat currencies, uncertainty in all major markets make Bitcoin an attractive alternative, but one that is likely to take a long time to reach its all-time peak of $1128.