With the arrival of Brexit tomorrow, how will it affect Bitcoin?

According to reports, the European Parliament passed the Brexit agreement on a large scale on the 29th local time, officially confirming that the UK will leave the European Union at 11 pm local time on the 31st (7 am Beijing time on February 1).

After years of hard work, Brexit will finally happen tomorrow. The event is expected to lead to major changes in the global economy and may have many unforeseen consequences. This also raises the question, will this geographical crisis have any impact on the Bitcoin and cryptocurrency markets?

How will British businessmen react?

This is a story of love and hate. After four years of referendum, political debate, delays, and uninterrupted negotiations between Britain and EU officials on how to achieve the maximum dissolution of Britain in the EU member states, it finally became a reality. . Britain will launch a new Brexit commemorative coin to mark the event, although many others said they would not accept it.

So, apart from the shiny new coins, what else will Brexit change? First, all UK member states of the European Parliament will lose their seats; British passports will change colours, from standard crimson passports to blue and gold designs (never seen since 1912)

British citizens can still live and work in EU countries, and there is a planned 11-month transition period during which officials can formulate a comprehensive free trade agreement between the UK and the EU. All these radical changes and uncertainties have led bitcoin traders to ask themselves whether it is time to add positions or cash out from the cryptocurrency market.

BigCheds, the most popular trader on Twitter, pointed out that the daily chart of BTC, LTC and BCH has bearish signs, and anonymous trader Crypto Dog on Twitter also noticed the bearish candlestick chart on the BTC chart.

Although Bitcoin is described as an emerging safe-haven asset, we may see the market fall due to the uncertainty brought by the transition.

Brexit may take months to feel the impact

Changes in Brexit tomorrow are more symbolic than anything, so it may not really shake too much of the market at first. EU and British officials have 11 months to really resolve details about residency, trade, health care, pensions, driver's licenses, and many other bureaucratic details as a country leaves the economic union.

Before the end of the transition period, many people may not see a large market shock effect, which depends entirely on whether the free trade negotiations between the EU and the UK are going smoothly.

EU officials said the 11-month transition period was not enough to adequately address the budgetary issues that would emerge after Britain's termination of payments. Until the negotiations are completed, ordinary EU citizens in the UK or British citizens living abroad may not notice much change in their daily lives.

One of the main issues facing the EU and Britain is a joint resolution on future security measures. Terrorism and crime will need to be resolved on a common basis, and what arrangements officials can make remains to be seen.

Overall, the cryptocurrency market has been bullish in the first month of 2020, so Brexit may be a smooth catalyst, although there is now a certain probability that it will cause a reversal. Earlier this week, the crypto market broke the psychologically significant $ 250 billion mark, ending a 7-month downtrend. Of course, Brexit may cause capital to flee to safer assets, but the cryptocurrency market currently sits at only $ 262 billion in market capitalization.

The original source is from Bitcoinist, compiled by the BluemountainLabs team. The English copyright belongs to the original author. For reprinting in Chinese, please contact the compiler.