In the UK, investors will be waiting for greater clarity about the outcome of Brexit negotiations and the risks of upheaval which will arise in leaving the EU. Short-term, the UK economy has performed not very well. The World Bank and others have recently forecast a slowing of growth in the current year and beyond while the current account deficit remains daunting. In these condition, our orienting is likely to remain protective, with an intensity on returns uncorrelated to the overall performance of equity markets. To increase our exposure to situations which should benefit from an environment of higher inflation, for example by being short of Government Bonds after a long period of declining inflation and low interest rates.
In the event of no deal in March 2019 in theory, it would be pushed in two opposite directions:
1. Increase interest rates in order to defend the currency and avoid a spike in inflation;
2. Loose monetary policy and inject fresh stimulus into the economy.
What will happen when the UK actually leaves the EU? Well, we expect that a similar trend will occur. People are likely to pump their GBP into Bitcoin in order to protect it against a GBP crash that could very well be caused by EU withdrawal. In this instance we will see the value of Bitcoin drive upwards. Investing in bitcoin may seem scary, but know that it takes time and effort to understand how Bitcoin works.
There is huge potential to make money on trading in Bitcoin, but it takes a level of expertise and knowledge about the market in the same way that trading on any other financial market does. In addition, the cryptocurrency market is extremely volatile and therefore may not suit everybody's tastes and risk appetite. The first issue with trading is that almost all of the trading exchanges operate through Bitcoin or Ethereum, meaning that if you wish to trade in cryptocurrency and don't own any, you will probably need to own some (with some exceptions).
Websites such as Coinbase (www.coinbase.com) or CEX (www.cex.io) both allow users to purchase cryptocurrency by credit or debit card, or alternatively to purchase via a bank transfer. Once purchased, you can then transfer your Bitcoin to whichever exchange you wish to operate on.
Early adherents to the Bitcoin industry have made significant fees through mining Bitcoin. Mining Bitcoin is the process by which new coins are created. Mining is carried out using certain computer programmes and utilises the processing power of the miner's computer. At its inception, Bitcoin mining was relatively simple and the earliest miners were able to mine thousands and thousands of Bitcoin with limited expenditure.
However, at the same time, the value of Bitcoin was nowhere near where it was today and therefore any large profits being made from mining didn't really begin to happen until a number of years after when the value of Bitcoin began to rise. Nowadays, Bitcoin mining is much harder. Each Bitcoin that is mined requires more processing power and therefore mining Bitcoin now involves significant processing power and can no longer be done without specialized equipment.
People are already moving or have moved to Bitcoin as the Brexit chaos keeps on getting bigger and messier. However, with an ever-expanding market the demand for Bitcoin expertise and Bitcoin related products means that there has never been a better time to get involved in Bitcoin.
No-Deal Brexit is only going to boost Bitcoin adoption as businesses and money get affected. Furthermore, a rise in the cost of credit card payments, processing of payments and red tape can be eliminated through Bitcoin and other cryptocurrencies. So, it's maybe the time for the Bitcoin to rise up to the power!