It’s showdown. With just days to go before the biggest geopolitical realignment in decades, all eyes are on the pound which has become almost as volatile as bitcoin.
And quite interestingly, seems to inversely correlate with the decentralized currency, although not fully, sometimes in a delayed way, and sometimes not at all.
We can see here a clear fall beginning in March and more steeply since May until mid-August when it briefly turns around to fall again since September until that big green candle today.
From March until the end of July, bitcoin’s price is basically no different than inverting the pound chart.
In July, the pound sort of sideways, so bitcoin doesn’t have that pound upwards pressure, with it then dropping in August.
In the last three days, the pound turned downwards again with some speed, with bitcoin so seeing a big green candle.
Now the pound has seen one big green candle, with it unclear whether that would affect bitcoin, but it does look like they correlate more when the pound falls, rather than when it rises.
The jump in pound’s value against the dollar today is probably because the Prime Minister Boris Johnson and his Irish counterpart Leo Varadkar agreed they can “see a pathway to a possible deal” after talks according to the BBC.
There were suggestions a deal is impossible or there won’t be an extension unless an election or a referendum, but logically it is sort of obvious what they will agree at the crucial EU summit on Thursday.
The Boris offer will most likely be watered down to include Northern Ireland in an EU customs union, but not Britain, only if however EU gives Northern Ireland the right to an exit clause, a referendum or some mechanism where the people of Northern Ireland can say they don’t want to be in a customs union or single market or anything, they want to be fully under British, or Westminster, jurisdiction.
Why they’d ever decide that, no one one knows especially considering they voted for remain, but it’s the principle of the right to autonomy.
A deal therefore logically is likely on the above terms, but that’s Northern Ireland which, frankly, no one cares about where finance is concerned because they’re a tiny economy.
The battle is for Britain, and what sort of deal England will have as well as Scotland and Wales and whether such deal would be better than just remaining.
From the sound of it one has to think their deal is Theresa May’s deal, just without the backstop.
So basically no deal, except UK has to pay some $50 billion, citizens have the right to citizenship, and there’s a two years transition period where nothing changes.
So this “deal” is just a deal for more talks. The actual deal has not even begun being considered. That’s the trade deal. And if you think negotiations have been tough so far, you’ve seen nothing yet when the real negotiations start as so far it’s just foreplay.
The Rebel Alliance
The deal that is super tough to negotiate is little more than having the ability to say UK technically has left EU.
That does matter politically. Nigel Farage would be kicked off the European Parliament. UK would have no EU commissioners. No say in any EU institution or aspect, but still would be subject to its rules for two year.
That technicality also matters because UK would lose the veto and the current deal it has with EU as a member of the union.
Economically such deal would not make a difference because there is no “real” deal. There are no talks on passporting for financial services, for example. On tariff free trade. On Erasmus. On pretty much anything at all.
So economically the uncertainty would continue if there is a deal for at least another two years when it will continue to be unclear whether UK’s economy would be disadvantaged by Brexit and if so by how much.
While whether the political uncertainty continues or otherwise may well be determined next week when the Rebel Alliance decides what to do.
Their most potent weapon is of course passing a referendum act. Such referendum would say deal or remain, with the “deal” part being what’s stated above, NI sort of in Europe but a clear out for the rest.
The Rebel Alliance has the majority in parliament and has the control of parliament until at least October 31st.
Such act moreover may well pass because it is of course legitimate that the British people decide just how they leave EU, and because in real politics it puts the entire blame on the British people for their decision if things go wrong as they would have fully voted for it.
For labour such act is a clear way out, but for conservatives too. Both are major national parties and a broad church of leavers and remainers, pro-eu and anti or nationalists, and all other shades in between.
Such referendum act therefore would allow both blue and red to say we delivered on Brexit, we negotiated a deal, do you want it, or do you think the member state deal is better.
Such referendum would also pretty much end the debate in regards to leave or remain because it would be a clear vote on a clear question by a fully informed electorate while there is no crisis of the 2016 sort with refugees or the fresh in mind euro crisis of the time.
So it would be a question about Europe, and only Europe, and whether they want to be part of it.
It is probable Labour has no choice but to do all it can to pass this act before the 31st of October or logically their downfall to Libdems is pretty much guaranteed as Labour would take much of the blame for colluding on Brexit otherwise.
For Libdems such referendum would give them a podium to make their case for Europe – well a podium everywhere but brexit BBC which keeps giving them no voice whatever yet splashes the Brexit Party members everywhere even on incredibly inappropriate segments like journalists commenting on papers.
While for conservatives such referendum may allow them to escape the loony far right that at the edges has a grip on their party and risks increasing such grip in a nationalistic manner.
So it’s a logical way out for all involved, including the British people, whichever side of the debate, as the risks are war and peace itself and therefore the blame should rest solely on the British people if things go wrong.
For this is not a four years decision, nor a decision that can easily be reversed, but a geopolitical fundamental structural transformation.
Yet not hugely serious. Brexit can well work our for the better for UK and EU as well as the rest of the world. But logically the certainty of such monumental decision is necessary, and such certainty can only be provided by a vote of the public on that specific question of deal or remain.
Whether there will be such vote may well be decided next week as Brexit now nears decision time.