UK Bank Deal and No-Deal Brexit News Could Be a Bullish Bitcoin Catalyst
The options are becoming increasingly thin when it comes to Brexit negotiations, and the UK is tightening the noose as it publishes a new report regarding a no-deal scenario.
There are a number of consequences that would come as a result of a clean break from the EU: companies would suffer from a new wave of red tape, increased payments for the access they have right now, and border delays for both EU and British citizens while Britons living in the EU would possibly lose access to their UK-based banks.
One of the understated upswings to this situation? It would create the environment necessary for a wider spread of Bitcoin adoption among the people, culminating in a large-scale boom as people walk away from fiat for the border less world of crypto.
Brexit – The Catalyst For A Bitcoin Boom, UK Bank Deal Demonstrates It
According to the latest reports, if Britain were to leave the European Union with no deal, British citizens that currently reside in the EU may not have access to their bank accounts.
While Britons will be able to use their bank cards to withdraw money from EU countries, but more than 1 million citizens living inside the country won't be able to use their British accounts to either make deposits or take out a loan.
Along with this, contracts such as annuities that pay pensions may not be accessible while the banks offering these services may also be negatively affected.
Britain's government has also stated that the companies that currently trade with the EU would also face a new wave of red tape, increased border delays, including costly credit card payments, These would all be potential effects of a no-deal Brexit.
Under The Threats Of A Brexit Nightmare, Bitcoin Is The Solution
According to a report made by Reuters, Dominic Raab, current Brexit secretary, has effectively marginalized the potential risks attached to a no-deal brexit:
“Brexit minister Dominic Raab played down the threat that tens of thousands of British retirees in the EU – many of whom live on the Spanish Mediterranean coast – could lose access to their pensions.”
Along with this, the UK is unable to decide the debt issued by the EU as ‘zero risks', meaning that banks would have to raise additional capital elsewhere. Due to the absence of no mutual recognition rules, the bank would also hold penalized securities and would either have to raise capital or sell their holdings in a Brexit nailed market. In a similar vein, British banks would be penalized by retaliatory penalties levied by the EU supervisors.
Additional layers of supervision, adverse liquidity, and capital consequences would be faced by banks due to UK’s no-deal Brexit.
Max Keiser took to Twitter to state that while the forecast is stormy for fiat users, businesses and banks, it's looking far brighter for Bitcoin:
“UK/EU banks are committing leveraged suicide en masse. Most bullish #Bitcoin news of 2018,”
— Max Keiser, tweet poet. (@maxkeiser) August 24, 2018
Everything, from the circulation of money, goods and services for businesses and countless financial institutions would be profoundly hamstrung, resulting in the Sterling losing a further level of ground to its international rivals. Conversely, this would present a stellar opportunity for investors to put their sterling to use by buying Bitcoin.
Why should they do that? It's because Bitcoin would serve, as the majority of US HODL'ers believe, as a virtual form of gold: a safe haven for investment, allowing them to move away from fiat speculation, finding instead a hedge which will safeguard their money.
— Stuart (@stuchi1975) August 23, 2018
People are already moving or have moved to Bitcoin as the Brexit chaos keeps on getting bigger and messier.
— Paul Melton (@Shadhammer) August 23, 2018
It's one of the unfortunate advantages that comes with the ever likely No-Deal Brexit scenario: the fact that it will compel people to adopt Bitcoin or some form of cryptocurrency to side-step the likelihood of red tape, and avoidable slow-down thanks to a new economic, and socio-political relationship. Cryptocurrency has the power to cut through what businesses see as inconveniences and trivial. So it's high time for Bitcoin to emerge as a powerhouse.