As major global currencies are in a slump, Bitcoin stands out and has become a financial 'safe haven'

When it comes to Bitcoin’s value and relevance as a globally traded currency, the digital currency has its fair share of mainstream critics and ‘haters’, partly due to fear and ignorance of Bitcoin, and partly due to the recent Hash Ocean incident.

Even so, Bitcoin has proven to be quite valuable and more substantial for those seeking to protect their wealth in these more turbulent economic times. When people actually do their research on Bitcoin and discover the impressive value this digital currency offers, the snickering will stop. Bitcoin has been a smart currency for some time, and the mainstream is beginning to wake up to this fact.

Bitcoin becomes a financial 'safe haven'

In economics, the term "safe haven" is a relative concept. From the Mt.Gox incident in the fall of 2013 to the beginning of 2015, Bitcoin was always treated as a "joke", because Bitcoin plummeted and it would take at least 800% to return to its previous level. Well, now? No one is laughing, especially those who invest in pounds and euros.

According to Bloomberg, Bitcoin prices have been more stable than the British pound since Brexit, and this trend will continue for some time. The price of the British pound has fallen to a 30-year low, and investors are quickly turning to BTC for relief.

“A lot of people are using pounds and euros to buy bitcoin,” said Jesse Powell, CEO of Kraken, the largest bitcoin exchange by euro trading volume. “Our euro-to-bitcoin volume has doubled… We’ve seen a huge increase in volume on our exchange. In this uncertain environment, people are looking for a safe place to store their money.”

The world's best performing currency

For those who haven’t been aware of the Bitcoin value equation over the past 18 months, Bitcoin was the world’s best performing currency in 2015, increasing 35% in value compared to the world’s reserve currency, the U.S. dollar.

This is 4 times the value of the US dollar itself over the same period. Bitcoin has performed even better in 2016, with a price of around $430 at the beginning of the year and now stabilizing around $650, an increase of nearly 50% in value.

“I think bitcoin has seen some benefit from Brexit in the last few days as consumers are buying bitcoin as an asset that is not tied to the global monetary system, more like gold,” Gil Luria, managing director at Wedbush Securities Inc., told Bloomberg News via email. “If other countries in the EU follow the U.K.’s lead, I expect some citizens in those countries will take a page from the U.K.’s book and protect their assets in bitcoin. While bitcoin is volatile, the volatility is still better than knowing your currency is going to lose 10-30% of its value in the next few weeks.”

Strong investment case

Whether a mainstream investor understands Bitcoin or not, it doesn’t take a lot of math to understand the strong investment case for Bitcoin returns.

This graphic provided by Bloomberg shows that no currency has appreciated as much as Bitcoin so far in 2016, and the 'Bitcoin halving' that took place last week is likely to further increase Bitcoin's economic dominance throughout the rest of 2016.

Those who invested in Bitcoin have reaped the rewards, while those who are stuck in Euros and Pounds are ready to woo ‘internet money’ like never before.