The Great British Pound Sterling has fallen to record lows against the US Dollar. In overnight trading, the pound hit a low of 1 pound = $1.04. It lost 5% of its value by twisting.
The United Kingdom’s sovereign currency, the pound sterling, is the world’s oldest currency still in use today. After regaining $.03 cents, it is currently stuck above USD-pound parity, moving to 1 pound = $1.07.
In the year The pound has been depreciating against the US dollar since 2007 and following the financial crisis. Although it has fallen 20% this year, it has lost half of its value against the dollar in the past 20 years.
Commentators such as Eric Voorhees, chief executive of Shapeshift, have commented on the sudden fall in UK purchasing power. proposed that The pound is now more volatile than Bitcoin (BTC). In numbers, Bitcoin is down 50% against the pound this year but is up 2% today and 9% last week.
The sharp fall in the value of the pound was largely due to last week’s budget announcements. The Financial Times reports that tax cuts and energy subsidies introduced by new Chancellor of the Exchequer Kwasi Kwarteng could create an unstable financial crisis for Britain in the 2020s.
In Prime Minister Liz Truss’ first budget, the biggest tax cuts in a generation were announced. The cuts are said to curb high energy costs and inflation. UK inflation is at record levels for the century, hitting double digits for the first time in 40 years last month.
Related: Global inflation: How a stable currency is helping to protect savings.
Beyond the channel in the Eurozone, inflation is also rampant. A record inflation rate of 9.1% was reported in August, and fears of a cold winter were compounded by energy shortages. Commentators and Twitter influencers like Kobe were eager to make light of the situation. Due to the drop in the value of the pound, all crypto-tokens seem to be priced higher in Coby’s home country of the United Kingdom.
Only up (my bags are charged in gbp)
— Cobie (@cobie) September 26, 2022
Others have Compared to Pounds into a “shitcoin” or carpet-dragging project, where scammers pick up tokens and run away with profits.