HOME CATEGORIES WRITE AND EARN 🔍
CATEGORIES WRITE AND EARN MORE

CRYPTO NEWS

Your favorite crypto news blog

Bitcoin Could Soar If The Bank Of England Decides To Implement A Negative Interest Rate

Bitcoin 2020/09/21 09:28 by Brenda Ngari
Bitcoin Could Soar If The Bank Of England Decides To Implement A Negative Interest Rate

Bitcoin stands to attract more investments from British Banks and citizens following an announcement by the Bank of England which is considering implementing a negative interest rate.

In a bid to stimulate its economy from the adverse effects of coronavirus and the impending Brexit event, the Bank of England hopes to encourage more spending.

Negative interest rates affect bank profitability as banks are charged to store cash and in turn transfer the costs to depositors holding cash in bank accounts.

According to the Monetary Policy Committee’s (MPC) September report, the Bank of England and the Prudential Regulation Authority will collaborate on the feasibility considerations of a negative Bank Rate in Q4 2020.

The Bank of England, which is responsible for setting monetary policy to meet the government’s inflation goals is currently targeting to maintain it at 2%. However the with the Bank Rate at already 0.1%, there’s little room to maneuver for additional monetary policy if Britain’s economy is expected to grow any further.

In its August’s report, the MPC had discussed the effectiveness of negative rates, in light of the decline in global equilibrium interest rates over a number of years.

“Subsequently, the MPC had been briefed on the Bank of England’s plans to explore how a negative Bank Rate could be implemented effectively, should the outlook for inflation and output warrant it at some point during this period of low equilibrium rates.”

The Bitcoin community sees this as another incentive for people to adopt cryptocurrencies as a store of value, to escape governments’ fiat currency manipulation tactics.

“The Bank of England is considering implementing negative rates, soon the big money crowd will have nowhere left to hide their mountains of wealth. Gold stocks and #bitcoin are all going to soar.”

Is Bitcoin Ready for Increased Adoption?

Bitcoin adoption has soared in 2020, as more people consider it a better store of value compared to fiat money, especially after high inflation being caused by coronavirus fiscal measures.

However, Bitcoin has several complexities that may seem foreign to average investors who may opt for other SOVs like precious metals or stocks. Additionally, Bitcoin has spent the last six months recovering from the March crash with repeated cases of high price swings.

The latest and most unlikely Bitcoin whale MicroStrategy’s founder and CEO Michael Saylor nonetheless says that despite its low market cap and volatility, Bitcoin’s solid monetary policy makes it a valid hedge against inflation.

“This investment reflects our belief that Bitcoin, as the world’s most widely-adopted cryptocurrency, is a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash.”

2 Like(s)



You should also read...

Other 04/12/19 23:30 by Jamie Redman
The Fed’s Money Creation System Is Fueling One of the Biggest Heists in History
Since mid-September, the Federal Reserve has injected three trillion U.S. dollars into the hands of private banks and Wall Street. Despite the fact that massive amounts of money was created out of thi...
Read More
Bitcoin 16/03/20 15:46 by Edwin Kinoti
Fed’s Sudden Rate Cut Plays Right Into The Bitcoin Halving
The US Federal Reserve (Fed) announced on Sunday March 15, that it is dropping the benchmark interest rate to zero. The Fed also launched a new round of quantitative easing program that involves buyi...
Read More
Altcoins 09/05/20 06:00 by Nick Chong
Crypto Tidbits: Bitcoin Roars Past $10k, Halving Days Away, Ethereum 2.0 Nears
Another week, another round of Crypto Tidbits.itcoin has been one of the best-performing assets in financial markets over the past week, managing to rally as high as $10,100 — a price around 25% hi...
Read More
Bitcoin 11/05/20 18:49 by Brenda Ngari
Paul Tudor Discloses He Has 1%-2% Of His Assets In Bitcoin, Calls It A ‘Great Speculation’
Just last week, the cryptocurrency market got excited with the news that pioneer Wall Street hedge fund manager Paul Tudor was buying bitcoin (BTC) to hedge against inflation caused by quantitative e...
Read More
Bitcoin 11/06/20 15:00 by Yashu Gola
Tudor Jones’ Latest Inflation Warning Spells Another Bullish Case for Bitcoin
Veteran hedge fund manager Paul Tudor Jones on Wednesday criticized the Federal Reserve’s quantitative easing policy. He warned that the central bank might lose track of the inflation that woul...
Read More