The current Brexit deadline is quickly approaching, but what impact will it have on cryptocurrencies?nbsp;
The UK failed to leave the EU on the anticipated date of March 29th, and the current Brexit deadline is 31 October 2019. What implications could this have on cryptocurrencies?
The UK was always the hub for fintech and finances. It has been faster than some other European countries in embracing crypto and blockchain technology. The country will no longer have to follow EU’s rules and bureaucracy, which have had a negative influence on the development of cryptocurrencies, so the blockchain technology would increasingly be used in cross-border trade. The UK is said to develop stronger blockchain/cryptocurrency partnerships with other, more open economies such as China, Australia, Brazil, South Korea and Singapore.
When the UK does finally leave the European Union it could actually mean good news for cryptocurrencies. Changes to the regulation around how people can buy and sell Bitcoin and other cryptocurrencies are likely to be more progressive, according to a survey of analysts conducted by Cindicator. In fact, 62% said they think Brexit might increase cryptocurrency values, and 74% said they will consider adding cryptocurrency to their own portfolio of investments, while 44% believe the UK will take a more progressive view of the crypto market post-Brexit.
On the other hand, many foreign investors are leaving the UK. One way that many are looking to hedge against risks is by investing in crypto assets.
Also, if a no-deal Brexit goes through, the UK central bank will have to “print cash”, making the Bitcoin rise against the Pound.
The price of the Bitcoin is volatile, but the investors are starting to believe it has a “safe-haven” status due to its finite supply and the fact that it’s borderless and decentralized, meaning it is less likely to affect one country. Some even call it the digital gold.
How will this impact the rest of Europe?
For example, a big part of Germany’s economy depends on trade with the UK. With Brexit, new costs would appear that would affect the profit margins. It is likely that the long-term effect of a no-deal Brexit on Germany would be higher economic volatility, meaning that the Bitcoin will rise against the Euro too, and that Brexit will cause turmoil across two major fiat currencies.
Some even predict that in the next five years other EU countries will also follow Britain, which means at least ten years of uncertainty for the Pound, Euro, and the Swiss Frank.
Instead of supporting only one cryptocurrency, every cryptocurrency should have a place in a global ecosystem that enables the users to get past the issues with today’s fiat-based systems.