The value of bitcoin rose sharply today as sterling dipped in response to the UK's decision to leave the European Union.
The cryptocurrency's price against the dollar rose by more than $100 to its highest point in over two years. At the time of writing, one bitcoin is worth $659 or £480 according to Coindesk's bitcoin price index, which averages the price of the currency across leading global bitcoin exchanges. Bitcoin reached $679 at 04:05 BST, shortly before the EU referendum result was confirmed.
Independent financial consultant Anuj Khanna told WIRED the bitcoin surge was likely to be a "temporary phenomenon" as people with large amounts of liquid assets scramble to find a stable currency to divert their cash into. As markets worldwide dip, investors "would have faced a loss today almost everywhere," he added, and so are turning to the cryptocurrency as a temporary respite before other currencies stabilise.
In the wake of the referendum, sterling has dropped to a 31 year low while the FTSE 100 also dipped 8.7 per cent before recovering to a 4.9 per cent drop.
Online money transfer service TransferWise suspended transactions using the pound yesterday to protect customers from market turbulence in the wake of the referendum. It's likely that transfers will come back online once the value of sterling settles down, though the company has not given a specific timescale for that to happen.
"We’re doing what we can to avoid customer payments set up prior to the referendum being negatively affected by the referendum outcome and predictions of the outcome throughout the day," TransferWise told its customers earlier this week.
There are currently over 15.5 million bitcoins in circulation which, at the current market valuation, are worth around £7.3 billion.
This article was originally published by WIRED UK
