“The British pound is now more volatile than Bitcoin,” tweeted ShapeShift’s CEO

The British pound has witnessed one of its biggest declines after falling to the lowest level recorded against the US dollar since 1985 – prompting a crypto exchange founder to observe volatility is not just limited to cryptocurrencies.

Friday the 23rd In September, the GBP/USD pair fell below the $1.10 threshold after witnessing what appeared to be a steady decline in the previous weeks.

As of Monday morning, the pound hit a new record low of less than $1.04, sending trading activity into a frenzy in an attempt to recover from the decline.

Commentators have weighed in on the pound’s collapse, with several linking the drop to the Conservative Party’s mini-budget announced last week which would see a new $45 billion tax cut package aimed at higher incomes in the UK.

BTC to USD

Decreasing factors

Before the 2007 financial crisis, the pound held steady around the $2 mark. Ahead of Brexit, the pound weakened slightly, fluctuating between the $1.50 and $1.70 region.

But recent weeks have seen an unusually rapid decline for the currency, which has plunged to near par with the US dollar.

Many believe that a prominent factor is the Conservative Party’s recent tax cuts aimed at reducing the large payouts to high earners in the UK. Although the mini-budget plan is aimed at allaying concerns about the rising cost of energy prices and inflation, many commentators believe the slowdown signals a bigger problem – markets have a lack of confidence in the UK economy.

Inflation in the UK has also been at record highs, hitting double digits at 10.1% in July, the first time in 40 years. It has since fallen to 9.9% in August.

ShapeShift founder and most recent CEO weighs in

Erik Voorhees – founder and last CEO of Switzerland-based crypto exchange ShapeShift which transitioned to a decentralized autonomous organization (DAO) in December 2021 – took to Twitter to discuss the pound’s fall, saying the pound is now “more volatile than bitcoin “.

Bitcoin has fallen more than 45% in value this year, but as recently as September 26, it was trading around $19,100, up about 1.2% in the past 24 hours.

Deputy leader of Britain’s Labor Party Angel Raynor also criticized the Conservative Party on Twitter, stating that the party “gambled recklessly – not with their own money – but all of ours”.

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