CPI for Bitcoin

[dree12]

A CPI is computed by taking the change in the value of BTC when compared to a basket of commodities, to measure the net inflation that the consumer takes. These commodities are divided into categories, so one can see the inflation rate of BTC compared to those categories. Would such an index be useful for Bitcoin now, or is it much too early?

I understand that many merchants price their goods in USD that is converted to a BTC price in real-time, so the Bitcoin CPI may resemble the USD CPI for a while yet. But I do see some utility for it, because some goods are priced in BTC directly and others may be based off other currencies. What do you think?

Sorry if this isn't the right section, please notify me if it isn't. If you happen to be a mod, please move it for me instead.

[Stephen Gornick]

I understand that many merchants price their goods in USD that is converted to a BTC price in real-time, so the Bitcoin CPI may resemble the USD CPI for a while yet. But I do see some utility for it, because some goods are priced in BTC directly and others may be based off other currencies. What do you think?

That would be neat to see.  The effort to collect and report that data is not trivial, and there are yet hardly any well known merchants who list prices in bitcoins.

So you are probably a couple years early.

The Billion Prices Project has dropped everything but their USD index, otherwise that would have been one place where something like this might have first emerged.
 
 - http://bpp.mit.edu/usa/

[niko]

If and when it becomes widely adopted for merchandise, yes. There are many uses of Bitcoin which would not be reflected in CPI, though - store of value and online tipping, for example.