In August, Chancellor Philip Hammond forecasted massive economic damage from crashing out of the European Union without a deal, warning of a 87.7 percent hit to GDP and an £80 billion black hole in public finances.
The Bank of England has also painted a worrying picture, cutting its GDP forecast for 2019 to 1.7 percent from 1.8 percent.
Cryptocurrency markets are well known for their wild fluctuation in price and value, and that has continued as Britain battles to secure a Brexit deal with Brussels.
Earlier this week, Bitcoin experienced its first three-month losing streak since 2015, and according to CoinDesk.com, closed on October 31 at £4,928 – down 4.32 percent from the October 1 opening price of £5,097.
The world’s largest and most popular cryptocurrency had enjoyed a slight resurgence, having fallen 9.22 percent and 5.8 percent in August and September respectively.
Bitcoin also celebrated 10 years on the cryptocurrency markets this week, but the closing price at the end of October marked a huge fall from the dizzy heights achieved last December, where it peaked just short of £15,700.
But cryptocurrency experts believe the market can take advantage of Brexit as investors fretting over the physical economy will use it more to secure their assets and boost their wealth.
Mike Rymanov, chief executive of Digital Securities Exchange (DSX) said Britain freeing itself from EU rules could enable it to adopt its own rules to push it forward into the hands of investors with more vigour.
He said: “Britain is already looking at how it can maintain its dominance in financial services post Brexit, even as some major players abandon ship ahead of March next year.
Brexit news: Britain’s exit from the EU could create a host of cryptocurrency opportunities (Image: GETTY)
“As such, crypto could present a big opportunity. While the EU looks to apply regulation at an EU level, taking it out of the control of member states, Britain could be free to apply its own rules and shape itself to become a well regulated and crypto friendly, market that looks to nurture the future of this financial movement rather than eye it with an air of suspicion and cynicism.”
Herbert Sim, chief commercial officer at Cryptology,said it’s hard to believe the UK won’t exploit the opportunities Brexit will open cryptocurrencies up to.
He claims leaving the EU will free the UK from “bureaucratic processes”, which have a detrimental impact on the growth of cryptocurrencies, and could soon trump its allies across the continent by forging blockchain partnerships with countries across the world.
Mr Sim said: “Leaving the EU will give the UK decision-making capabilities on areas that the EU’s bureaucratic processes can be desperately slow to decide on.
Brexit news: Philip Hammond warned of the impact a no-deal could have on the economy (Image: GETTY)
“If the UK were to draw up a bespoke regulatory framework and maintain a measured oversight of the cryptocurrency industry, the benefits could be substantial.
“The UK is already a tech and fintech hub but, with this, it is poised to be ahead of the curve to Europe, taking the lead in this new area of finance as it has done for many other areas of financial services in the past.
“Looking ahead, we anticipate that Brexit will allow for stronger blockchain/cryptocurrency partnerships with other, more open and crypto-friendly economies such as that of China, Australia, Brazil, South Korea and Singapore.”
Iqbal V Gandham, UK managing director of global investment platform eToro, claims any volatility from Brexit will only be short-term.
He said: “We are already seeing crypto assets used as an alternative in less stable economies, and Brexit could spark a new wave of investment from people looking to diversify their portfolios and hedge against geopolitical risk.”
Brexit news: Stronger cryptocurrency partnerships could open with other major economies (Image: GETTY)
But Mr Rymanov is quick to warn Britain could still end up falling in line with EU processes.
The DSX chief urged the market to not become frozen by Brexit fear and push ahead quickly with investment into new technologies.
He said: “The UK might continue to fall in line with the rest of the EU. It’s already launched a new Anti Money Laundering (AML) watchdog, and outlined a clear intention to adopt the EU’s fifth AML directive, even after Brexit, all geared towards a closer inspection of the crypto world.
“What’s essential is that Britain maintains a competitive edge and continues to be a hub of innovation in the financial sector. It has been seen to be faster than some of its European counterparts in embracing crypto and working with blockchain technology.
“What can’t happen is for Britain to become scared of its own financial shadow and water down the investment its made into new technologies, all in a bid to placate the traditional financial services world.”