BTC has been inching on the higher side against the GBP as investors turn their eyes to the effects of Brexit on cryptocurrencies prices.
The onset of Brexit saw an immediate reaction to Bitcoin to pounds trading because the BTC prices of exponentially rose against the GBP.
Consequently, the GBP significantly weakened against all other currencies because of the uncertainties that surrounded the exit of the United Kingdom from the European Union (EU). Since then, the price of BTC has been steadily soaring after the Brexit-related events.
That is why it is essential to try and figure out the correlation between the price movements of BTC and Brexit to give traders some more in-depth insights to make informed decisions when participating in Bitcoin to pounds trading markets.
Learn About Price Movements of BTC in history.
Looking down thru the memory lane, the only evidence that the prices of BTC have always been experiencing spikes in times of economic and political uncertainty when participating in Bitcoin to pounds trading.
Good examples of events that saw the price movements of BTC move interestingly were the 2015 Greek debt crisis and 2013 Cypress bank bail-in. The same price shifts got also experienced when the UK made a surprise vote to exit the EU during the 2016 referendum.
However, it was not surprising that among the most traded currencies, the Bitcoin BTC to British pound GBP pair got rallied even more since the value of the GBP plummeted to a 31-year low when compared to other currencies.
Bitcoin to pounds | BTC price reaction against the Brexit dates
What is more interesting for forex market players that are keen on monitoring the BTC/GBP Bitcoin price is the way the prices react following Brexit dates.
Apart from the aggressive price movements after the vote to leave the EU in June of 2016, there’s a series of exciting reactions follows:
- October 2, 2016: BTC prices did not react when the UK’s Prime Minister Theresa May made the announcement indicating that UK will initiate the formal process of exiting the EU come March 2017.
- March 29, 2017: BTC interestingly rallies by 2% when the UK triggered Article 50 to initiate the process that got set to be completed by March 2019.
- November 25, 2018: BTC made a significant jump of 7% when the EU approved a withdrawal deal that got agreed with Britain impending approval by the British Parliament.
- January 12, March 12 and March 30, 2019: BTC did not react when the British Parliament rejected the proposed Brexit deals.
- April 11, 2019: Not reaction from BTC when the EU and the UK agreed on extending the deadline to October 31.
Bitcoin to pounds | Analysis of the Google trends
A comparison of the search terms BTC and ‘Brexit’ for Google News Searches, you will be able to observe that there were several spikes in the search numbers for thee terms at one particular time for the last three years.
However, it is essential to note that the correlation between Brexit and BTC prices movements was to one-to-one. Because the search demand for BTC was especially massive in the later months of 2017 while the search for Brexit increased in the early days of 2019, this was the time when all the details regarding the exit of UK from the EU were supposed to get completed.
A clear indication that a good number of investors were looking at the conversion exchange rates for Bitcoins to pounds to have a better understanding of Bitcoin to British pounds Sterling trading because there were instances of uncertainty surrounding the exit of the UK from the EU.
Growing correlation with BTC on Bitcoin to pounds trading
Even with the gains, BTC made in the Great Britain markets; they coincided with the losses experienced by the GBP against other currencies with most of them witnessed around October 11 and 12.
That is why to would be least likely for mainstream investors to consider BTC as a hedging instrument during the Brexit uncertainty. The probability of BTC striking more gains in the future is looking better with noted market analysts and the EU forecasting the probable extension for the Brexit deal.
Brexit impact on Bitcoin to pounds trading
The UK’s vote to leave the EU will have far-reaching consequences that fiats may find challenging to bear. BTC, being the most prominent contender among fiats, will find a safe space for itself with such volatility.
Since the BTC has been in a safer zone compared to other fiats, cases of scepticism have to get curbed with the prices of BTC doubling in correlation with gold.
Ultimately, people will get tired of investing in an economy whose currency is losing its strength. The result is the foreign markets will put restrictions on your goods.
People will move to BTC instead of losing their funds while storing them in GBP. The decision gets majorly based on the level of risks and benefits that are associated with hedging such assets.
From the correlation analysis, it is evident that the price of BTC aggressively reacted to the outcomes of the referendum vote especially depicted by the correlation between BTC prices, Brexit announcements and the Brexit Google Search Trends.
Bitcoin to pounds trading players that seek to place bets on the correlation between BTC and Brexit could profit by positioning themselves strategically ahead of the Brexit dates.
However, for long-term investors, this correlation should have no bearing in the long haul investment decisions since the short-term volatility caused by Brexit will not likely have a significant effect on the price developments of BTC in the long-term.