Along with sending a shock wave across the global market, Brexit has caused a surge in the value of bitcoins. The cryptocurrency’s exchange rate jumped by an astounding 120 dollars, landing at 679 dollars per bitcoin. Obviously, the currency has experienced sharper swings throughout its existence. At its highest, the price of a bitcoin exceeded 1.2 thousand dollars. In more recent times, though, the exchange rate has been relatively steady without extreme ups and downs. However, such a milestone event as the United Kingdom’s departure from the European Union has triggered a sudden spurt in the digital currency’s price. This rally can be explained quite simply: investors are flocking to safe haven assets to sit out the turmoil that erupted in financial markets following the Brexiteers’ victory.
So-called safe havens tend to go up during market uncertainty as the demand for riskless assets rises in direct proportion to current price volatility in the market. For example, gold has been on an upward track lately, as well as bitcoins. The yellow metal gained more than 4% in value over a short period of time, climbing beyond 1,400 dollars an ounce. Compared with other virtual currencies, the bitcoin is the world’s most popular and widely used payment method. Owing to its popularity, governments in a number of countries have decided to ban the use of bitcoins on a legal basis. Those involved in operations with bitcoins risk facing severe administrative penalties. At present, there are about 15.5 million bitcoins in circulation.
