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Bitcoin price: Cryptocurrency rises as pound crash brings panic to traditional money

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The pound’s collapse against the dollar has coincided with a resurgent crypto market that has seen the worth of bitcoin shoot up by greater than 10 per cent in recent days, leading some market commentators to suggest that the fiat currency’s weakness was helping drive up the worth of the cryptocurrency.

The world’s most precious cryptocurrency has been remarkably stable over the previous couple of weeks despite broader economic turmoil, trading inside a comparatively narrow band between $18,300 and $20,000 before reaching a high of $20,338 on Tuesday, in response to CoinMarketCap’s price index.

In comparison with the high rates of GBP inflation and a declining value against the dollar, bitcoin has a set supply that’s designed to be deflationary over the long run.

The value volatility that typically accompanies bitcoin and other cryptocurrencies also appears to have stabilised in recent weeks and months.

“You already know we’ve reached a singular time in history when bitcoin suddenly is less volatile than fiat currencies,” said Sven Henrich, founding father of markets research firm Northman Trader.

The most recent bitcoin price surge got here just hours after the pound hit an all-time low against the dollar within the wake of the tax-cutting mini-Budget announcement by Chancellor of the Exchequer Kwasi Kwarteng.

“We’re confident in our long-term technique to drive economic growth through tax cuts and supply-side reform,” Mr Kwarteng said in a gathering on Tuesday with representatives of the Financial Services industry.

“I’m confident that with our growth plan and the upcoming medium-term fiscal plan – with close cooperation with the Bank [of England] – our approach will work.”

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Writing for Cointelegraph, crypto analyst Marcel Pechman suggested the plummeting price of the pound “might be a game-changer” for cryptocurrencies.

He wrote: “Once the final population realises their savings and investments are being devalued more aggressively by central bank stimulus measures, the advantages of a decentralized form of cash could turn into clear.”

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