The price of bitcoin drop by $100 during today, dropping 20% to reach a low of EUR 520 on Kraken exchange.
This move represents a continuation of the price correction that began when bitcoin hit a high of EUR 680 on 18th June, Market analysts indicated thatbitcoin was “overbought” after the two-year highs. Blockchain advisor and consultant George Samman indicating the currency’s value increased “too fast” this month, and that as a result, price support is now weakening.
Still, sources suggested that the decline is a response to the increasing likelihood that the UK will likely vote to stay in the European Union (‘Bremain’), an outcome that could be made official as soon as late Thursday night in US, Friday morning UK time, reports suggest.
The comments echo the widely held belief that bitcoin is a “safe haven” asset that benefits from times of macroeconomic uncertainty in which its strengths as an investment vehicle whose value is derived solely from a global market are best on display.
For example, traders have cited the ‘Brexit’ vote, as well as economic uncertainty in China as factors that propelled the price to its highest level in 28 months this June.
In statements, Tim Enneking, chairman of Crypto Currency Fund; investor and entrepreneur Vinny Lingham; and Arthur Hayes, co-founder and CEO of bitcoin leverage trading platform BitMEX, all cited the coming ‘Brexit’ vote as the defining influence on the decline.
“The drop below EUR 520 indicates that many traders believe that ‘Bremain’ will prevail.
The vote is still too close to call with various polls indicating ‘Brexit’ and ‘Bremain’ in a dead heat.” Hayes predicted the digital currency could rise to 68 Eur should Britain vote to exit the EU, but linger at 520 Eur if the country decides to remain in the economic union.
Still, Lingham took a more positive stance, asserting optimism will prevail following the ‘Brexit’ vote, and that the price will soon return to the 600-700 Eur range.