We finally have some closure with regard to Britain leaving the European Union. The latest Brexit referendum has resulted in over 50 percent of the English voters choosing to leave the European Union against 48.1 percent. The results of Brexit referendum have put the whole bloc into turmoil as many were convinced that Brits would vote to ‘Remain’ instead of ‘Leave’. The resulting politico-economic indecision is being reflected in the international markets with the value of Euro and Pound Sterling registering a fall.
As the value of European currencies falls, the universal currency with no state — Bitcoin is benefiting from the Brexit situation. The value of Bitcoin has surged overnight by about 100 points to reach a high of $683.9. Since the rise, the digital currency has seen a small drop in its value, hovering around $660 (at the time of writing). The reduced value of Bitcoin may be attributed to the Prime Minister David Cameron’s resignation.
These new developments also mean uncertainty in terms of whether Britain is going to honor the results of the referendum or not. David Cameron was known to be pro-referendum with the intention of following through with the results, whatever it might be. But with the Prime Minister stepping down, the replacement/interim head of the state may also decide to ignore the results of the referendum, and find some other alternative. The Brexit referendum is not a legally binding one, so there is no compulsion on the part of the British Government to follow the results.
Now, the question is whether the British Government invokes the Article 50 of Lisbon Treaty, or decide to pay heed to a growing petition for another referendum being floated by few politicians. If the government decides to hold another referendum, the present one will be rendered worthless and resulting elections may have a completely different outcome.
The gains gathered by Bitcoin may be short-lived if Britain doesn’t invoke the Article 50 as it will result in things returning back to normalcy like nothing ever happened. However, the citizens continue to remain unhappy about Britain’s expenditure of over GBP 350 million every week to be a member of the EU as the country’s healthcare system falters.
As the global markets fall — Dow (INDEXDJX:.DJI) opening at a low of 700; Nikkei Index (INDEXNIKKEI:NI225) down by 8 percent and US Treasury hitting a 10-year low, the Gold futures, and Bitcoin better known as safe haven assets have increased.
Ref: The Telegraph |CNBC | The Guardian | Image: The Guardian | Chart: CoinMarketCap
