The value of sterling may have plunged more than 10 percent on the back of the U.K.'s decision to leave the European Union on Friday, but for those who have invested in bitcoin, the Brexit has been a boon.
In the space of the last 24 hours, as it emerged that 52 percent of the electorate had voted for the U.K. to leave the EU, the price of bitcoin has surged from $580 to $680, according to the CoinDesk Bitcoin Price Index. The value of bitcoin has closely followed the sentiment around the Brexit vote over the last week.
Last week, when polls suggested the U.K. was going to back a vote to leave, the price of bitcoin surged, but over the weekend, as analysts and financial institutions claimed a remain vote was the likely winner, the price of bitcoin fell dramatically, including a drop of $100 in the space of just five hours Wednesday before the voting booths opened.
Unlike the value of sterling, bitcoin prices tend to soar in periods of macroeconomic uncertainty, and with the U.K. considering a complete break from the EU, bitcoin is seen as a stronger investment opportunity. The recent devaluation of the Chinese yuan led to a similar surge in bitcoin prices as uncertainty there pushed more people to consider bitcoin as an investment vehicle.
Bitcoin became an even more appealing proposition for Britons looking to move their money out of the country after one of the most popular international money transfer services — TransferWise — paused operation ahead of the vote this week. “With the EU Referendum in the U.K. on Thursday, June 23, exchange rates are likely to be volatile,” the company said. “We’ve been putting plans in place so that your transfers continue to be processed as smoothly as possible.”