Bitcoin Price In UK May Surge If Britain Sells Their £4B Stash
On Sunday, Bitcoin price in UK surged above £52,000, hitting the peak of its long-term bull flag. Is £BTC gearing up for a major price surge? When will the leading cryptocurrency make its move?
Three weeks can bring significant change. Back in early July, Bitcoin hovered around £41,500, and many investors might have considered selling, with some likely following through. Now, Bitcoin stands at the top of its bull flag, suggesting that a major upward move could be imminent.
Following Germany’s recent Bitcoin sell-off, the crypto market is speculating whether the UK might take similar action. Recently, a new Chancellor of the Exchequer, Rachael Reeves, faced pressure to fund her economic plans. Therefore, concerns arose over the potential impact of selling the UK’s substantial BTC holdings. If Reeves opts to sell, rumors suggest it could trigger a Bitcoin UK price dip.
Crypto intelligence platform Arkham reports that the UK government held approximately 61,245 Bitcoins as of July 19. The value equals to almost £4billion. However, selling these assets could lead to a significant drop in Bitcoin’s price. Akin to the impact of Germany’s recent large-scale Bitcoin sell-off. The German government’s sale of nearly 50,000 BTC led to a 15% price decline. So, will the UK follow Germany’s lead?
Bitcoin Holdings in the UK: Reeves’s Strategy
It is no secret to the public, that Rachael Reeves is a politician who possesses a part of UK Bitcoin holdings. BitcoinTreasuries.net reports that governments currently own approximately $31 billion worth of Bitcoin, with a significant portion belonging to the UK.
Earlier this year, the Crown Prosecution Service convicted Jian Wen, a former takeaway worker who became an international money launderer. They also obtained a property freezing order against her assets, including Bitcoin valued at approximately £2 billion at the time.
According to figures from crypto intelligence firm Arkham, cited by accountants at RSM UK, the UK now holds 61,245 Bitcoins, most of which were previously owned by Wen and are now valued at around £3.9 billion ($5 billion). The UK must complete a civil recovery process to confirm that Wen’s assets were illegally obtained and should be forfeited to the state, notes RSM.
Typically, crime proceeds are divided between the police and the Home Office. However, the scale of this asset haul suggests Reeves will likely have the final decision.
As Reeves considers utilising the Bitcoin billions, she will likely recall the decision by her predecessor, Gordon Brown, to sell the UK’s gold reserves. Between 1999 and 2002, Brown sold 401 tons of gold at an average price of £213 per ounce. At that time, this decision probably seemed reasonable, given that other central banks were also selling their gold.
However, with the rise of fiat currencies and the dotcom boom, gold appeared less significant. Its price continued to drop, and central bankers’ confidence in gold as a diversifier waned. In 1999, the New York Times even questioned the necessity of gold in the presence of figures like Alan Greenspan. Brown’s actions generated approximately £2.71 billion.
Selling Gold Legacy: Reeves’s Future Strategy
In hindsight, the decision to sell the UK’s gold reserves proved disastrous. It has become one of the most regrettable trades in market history. From early 1980 until the UK began selling its gold in July 1999, gold prices had dropped by 60%.
However, these sales coincided with the end of a two-decade bear market for gold, which then surged by 20% over the next three years. This week, gold set a new record, surpassing £1,921 per ounce. Central banks have significantly increased their gold purchases as they rebuild reserves. As a result, Brown is remembered for having sold gold at its lowest point.
The Labour chancellor should consider selling Britain’s seized cryptocurrency assets to support her economic plans. Rachel Reeves needs funds as the new Chancellor of the Exchequer, inheriting what she describes as one of the most challenging situations since World War II. Achieving her objective to “rebuild Britain and enhance every region” will be costly. Fortunately, Britain’s Bitcoin holdings offer a ready source of funds without the need for tax increases.
Reeves should act on this opportunity, despite the risk of leaving a less favorable legacy compared to her predecessor, Gordon Brown. The situation differs from Brown’s with gold; Bitcoin remains neither a currency nor a well-established asset class and is unlikely to become part of the Bank of England’s reserves. The chancellor and the Treasury should avoid speculating on the future value of Bitcoin Price UK. Similar to how they would not set up an Airbnb for confiscated Mayfair mansions or use a watch lending service for seized Rolexes.
Strategic Considerations for Selling and Regulatory Implications
Reeves should proceed with selling the Bitcoin and use the proceeds for immediate improvements, aiming for a more strategic approach than Gordon Brown’s. Brown’s approach led to selling at a very low price due to poor execution.
Besides, Reeves should also consider Germany’s recent actions; Arkham’s data, as noted by RSM, reveals that the German government sold nearly 50,000 Bitcoins since mid-June. Potentially, contributing to a 15% drop in Bitcoin’s price before the Trump trade period.
To avoid criticism from crypto enthusiasts who advocate for holding onto Bitcoin, Reeves could ease regulatory restrictions. Charlie Morris of Bytecoin suggests that the UK’s current stance is “the most anti-crypto in the west.” By introducing a liquid closed-end fund for retail investors, Reeves could benefit the London Stock Exchange and signal greater support for technological progress from the new government.
Moreover, Reeves may need to consider that international criminals continue to use Bitcoin and law enforcement keeps apprehending them. Therefore, more cryptocurrency might come into her possession. Gordon Brown did not have this advantage. Today, central bankers, rather than criminals, are the primary holders of gold.
BTC Price UK Rising Due to Trump’s Influence
As Donald Trump increasingly looks set to defeat Joe Biden in the US presidential election, investors are rushing to acquire assets that could benefit from a Trump presidency. This includes smaller US companies likely to gain from protectionist measures, European defense firms anticipating higher military budgets, US energy companies, and notably, Bitcoin.
The Republican stance on cryptocurrencies seems more favorable compared to Biden’s, despite the sector’s strong performance during his administration. Their recent platform criticises cryptocurrency crackdowns as “unlawful and un-American.”
Trump’s new running mate, JD Vance, clearly supports cryptocurrencies, as evidenced by his latest financial disclosure showing around £77,500 in Bitcoin holdings. As a result, Bitcoin’s value has surged by over 10% since the attempt on Trump’s life, benefiting its investors.
Bernstein analyst, Gautam Chhugani, found that the crypto market views a potential Trump win as beneficial for cryptocurrencies. Currently, Bitcoin’s price shows a strong connection to the likelihood of a Trump presidency.
Following Saturday’s failed assassination attempt on Trump, Bitcoin’s value has increased by about 10% to nearly £53,000. This incident has raised Trump’s chances of winning the presidential election in November, according to betting markets, offering a somewhat imperfect real-time gauge of voter shifts. Recent polls also indicate that Trump currently has a slight lead over Biden.
BTC/GBP 5-Day Chart
Where Are We at Right Now? Bitcoin Price Live UK
In the last 24 hours, Bitcoin has experienced a modest dip of 0.59% against the British pound. Despite this recent decline, the cryptocurrency has demonstrated robust performance over the past week, climbing by 11.61%. Bitcoin’s value has also increased by 3.24% over the past month, and it has shown remarkable growth of 66.75% over the last six months.
Year-to-date, Bitcoin has appreciated by 57.22%, and its annual performance is particularly striking at 125.76%. Over the past five years, Bitcoin has surged by 559.89%, highlighting its significant long-term expansion. Since its inception, Bitcoin’s value has soared by an extraordinary 32,840%.
Currently, the trading volume stands at 64.07 BTC. Bitcoin price UK today recorded at £52,676.56. The opening price was £52,676.03, and today’s trading range has fluctuated between £51,771.63 and £52,858.19.
For future projections, market analysts will keep a keen eye on Reeves’ next moves. Crypto enthusiasts predict that by the end of summer 2024, Bitcoin’s price could reach approximately $74,703.77. In August 2024, Bitcoin might experience a decline, potentially falling to a low of $66,861.59. Conversely, the price could rise to a maximum of $82,545.95 during the same month.
