Pound sterling volatility almost surpasses that of bitcoin
Pound Sterling, photo by Philip Veater via Unsplash
In what appears to be a role reversal, Bitcoin is now becoming less volatile than the British national currency.
According to data provided by Bloomberg, the 30-day volatility of the pound sterling against the US dollar has risen in the last month.
Meanwhile, Bitcoin volatility has decreased substantially since June, and even more since early October. This brought the volatility of each currency to a more or less similar point.
Bitcoin dropped as one of the best performing assets in the previous quarter as it remained relatively flat, albeit on the downside, while equities and commodities continued to decline.
The pound experienced turbulent volatility in late September, nearly dropping to par with the US dollar. At the same time, the trading volume of the BTC/pound pair has skyrocketed, an emerging trend among collapsing currencies.
Global bond markets are also showing greater volatility against Bitcoin, despite the former’s reputation for safety and reliability, and the latter’s reputation as a risky asset.
In the case of Great Britain, the Bank of England has now returned to temporary quantitative easing to contain instability in its bond market.
Many central banks – including former Fed Chairman Ben Bernanke – have previously denied that Bitcoin could constitute a form of money, largely due to its high volatility.
Sweden’s central bank made a similar argument in May: “Bitcoin price has had a high degree of volatility and is therefore a relatively poor preserver,” it explained on Twitter.