Bitcoin the hedge against inflation

[Wiwo]

Bitcoin as a deflationary currency has sustained its position as the only exit from inflation as Bitcoin continues to move above every form of resistance from the Central currency which is an inflationary tool in the hands of the government and the central banks.
Bitcoin made a 9.3% price increases against the United States dollars on the first day of October a move that happens on a day the US Department of Commerce announced the 0.3% increase in August and 3.6% over a year.

[pooya87]

The other possibly more important reason why bitcoin can act as a hedge against inflation and the possible failing economy is that bitcoin is not linked to the traditional assets even though it may be affected by the economy as a whole in short term.

Bitcoin made a 9.3% price increases against the United States dollars on the first day of October

The short term increases (or decreases) don't matter. The long term is the important one.
For example over the past 2 years from 2020, price has gone up 1400% or
in a longer period over the past 5 years from 2016 price has gone up 11000%

[Upgrade00]

Bitcoin continues to move above every form of resistance from the Central currency which is an inflationary tool in the hands of the government and the central banks.

Bitcoin was never subject to resistance from the central currency as they are both uncorrelated and respond to different factors. As you said, fiat is a tool for the government and banks, Bitcoin is an asset which is free for all to use and controlled by none.
This decentralization makes Bitcoin immune to poor fiscal policies which fiat currencies are exposed to and makes it less susceptible to inflation. Corrupt and underdeveloped countries usually suffer from inflation a lot and their currencies are highly unstable, for those people bitcoin is an ideal hedge against inflation.

[Poker Player]

I would qualify that and say that Bitcoin is by far the best asset to beat inflation. Assets that were used to beat inflation traditionally do not have a limit to their production. Bitcoin does. That makes Bitcoin by far the most profitable asset since its birth, not simply by beating inflation by 2-15%, as traditional assets did.

The other possibly more important reason why bitcoin can act as a hedge against inflation and the possible failing economy is that bitcoin is not linked to the traditional assets even though it may be affected by the economy as a whole in short term.

I agree. It's what's called an uncorrelated asset. But over time it will become less uncorrelated if large institutions continue to buy in.

[MrcMrc]

The United States does not need this advice as there are already aware of the implication of using Bitcoin and its advantage, it is the citizens that are left with the choice even china can not ban Bitcoin but can ban it, citizens, from using Bitcoin and this is two different things.

[Kakmakr]

Bitcoin can only be a hedge against inflation ..if it beats inflation year on year.... but something that can help with that is this... if the inflation is say 5% and you manage to buy low and you sell at a much higher price, like I did in 2017 when I made a 800% profit on my initial investment... then you divide that 800% by 6% and you will get 133 years .. that this investment kicked inflation ass... if inflation stay at more or less 5%.  

Let's divide 800% by 10% = 80 years that you will get double your money back on your initial investment. (You also get interest on that money ...if you re-invest it... or simply put it in a Bank)

This is the extreme scenario and not everyone can get a big profit like I did.... but it shows you how you can beat inflation, if you are lucky.  

[dothebeats]

Hence why some huge companies are already purchasing bitcoin in huge numbers. If the data and statistics don't speak for themselves, these companies would probably just ignore bitcoin up to now and stick with their assets and fiat, however that's not the case.

During the first year of the pandemic, bitcoin outperformed lots of traditional assets in terms of valuation. While the rest of the world's economy is scrambling to patch itself up and prevent itself from collapsing, bitcoin just didn't care and zoomed to its new ATH. Of course, a lot of hype and FOMO kicked in during those times, but to know that a lot of people were willing to buy bitcoin in the midst of a pandemic says something about the asset itself.

[DapanasFruit]

This is the biggest landmark for Bitcoin, being deflationary which is also connection with it being a good store of value. While we are all rooting for Bitcoin to become primarily a currency to be used for everyday transactions, we can not forced its implementation and this is also because people are holding on to their Bitcoin...why would I be using it to buy a coffee when I know for a fact that soon it will increase it value? Soon, Bitcoin will really be recognized for this job alone, that of protecting us from inflation which is getting to be unescapable these days along with taxes and death.

[SquirrelJulietGarden]

I would qualify that and say that Bitcoin is by far the best asset to beat inflation. Assets that were used to beat inflation traditionally do not have a limit to their production. Bitcoin does. That makes Bitcoin by far the most profitable asset since its birth, not simply by beating inflation by 2-15%, as traditional assets did.

Bitcoin can not be created, mined more than 21 M. With the increasing demand, the limited supply means deflationary.

Fiats can be printed as much as governments want. Stable coins can be minted as much as stable coin companies want. With Bitcoin, nobody, no institute, no government can create more than 21M and 18.8M of Bitcoin was mined

https://coinmarketcap.com/currencies/bitcoin/

[Lucius]

The short term increases (or decreases) don't matter. The long term is the important one.
For example over the past 2 years from 2020, price has gone up 1400% or
in a longer period over the past 5 years from 2016 price has gone up 11000%

I keep wondering when people ask questions like this, as if what you, me, and some others know is some secret knowledge that is not available to an ordinary person who just needs to turn on a computer, go online and use a search engine. In general, most beginners who come to this forum show that they do not have the ability to see the bigger picture, and that is why they are constantly in a kind of panic every time the price drops by 5% or more.

I believe that some who read your post sincerely doubt the accuracy of your data because it seems unreal to them - and it is even more unrealistic to believe that Bitcoin has really shown so far that it is a very good (not to say excellent) hedge against inflation. Far from advising anyone to invest in something, but Bitcoin has really protected me from inflation in the past 5+ years in a way I could never have imagined.

[Tessnik]

The short-term increases (or decreases) don't matter. The long term is the important one.
For example over the past 2 years from 2020, the price has gone up 1400% or
in a longer period over the past 5 years from 2016 price has gone up 11000%

I keep wondering when people ask questions like this as if what you, me, and some others know is some secret knowledge that is not available to an ordinary person who just needs to turn on a computer, go online and use a search engine. In general, most beginners who come to this forum show that they cannot see the bigger picture, and that is why they are constantly in a kind of panic every time the price drops by 5% or more.

I believe that some who read your post sincerely doubt the accuracy of your data because it seems unreal to them - and it is even more unrealistic to believe that Bitcoin has shown so far that it is a very good (not to say excellent) hedge against inflation. Far from advising anyone to invest in something, but Bitcoin has protected me from inflation in the past 5+ years in a way I could never have imagined.

After reading your comment I have to do some little google search before commenting here, you are right the data is not correct I hope to see it edited and updated with the right data. That being said bitcoin is not in the same category as faint currency as the total supply of bitcoin can not be exceeded but the faint currency can be printed at will by the central bank.

[Saidasun]

I keep wondering when people ask questions like this, as if what you, me, and some others know is some secret knowledge that is not available to an ordinary person who just needs to turn on a computer, go online and use a search engine. In general, most beginners who come to this forum show that they do not have the ability to see the bigger picture, and that is why they are constantly in a kind of panic every time the price drops by 5% or more.

I believe that some who read your post sincerely doubt the accuracy of your data because it seems unreal to them - and it is even more unrealistic to believe that Bitcoin has really shown so far that it is a very good (not to say excellent) hedge against inflation. Far from advising anyone to invest in something, but Bitcoin has really protected me from inflation in the past 5+ years in a way I could never have imagined.

Bitcoin is unique in the amount it has increased but it is not uncommon to see stock markets get a 100-1000% increase in value. The difference was Bitcoin was holding its price and then continuing to increase which meant we arrived at over 50k price. Stocks usually dip and dive more than Bitcoin and do not see a high percentage over a 5 year time instead they go up by 100% but then negative news sends them back down to 10% increase.

The short term increases (or decreases) don't matter. The long term is the important one.
For example over the past 2 years from 2020, price has gone up 1400% or
in a longer period over the past 5 years from 2016 price has gone up 11000%

Do you think Bitcoin will continue to see big percent of increase in value in the next 2-5 years or do you expect Bitcoin inflation to reduce quickly now that we have seen huge gains in the last 5 years?

[pooya87]

I have to do some little google search ~ the data is not correct I hope to see it edited and updated with the right data.

I don't know what you searched and where you looked but the numbers I posted are correct. I rounded some numbers for convenience and used the average instead of highest/lowest but that doesn't make any difference in what I was saying about the long term rise. Lets take a look.

Here is what you should have looked which is the chart showing the price change over the years: https://bitcoinwisdom.io/markets/bitstamp/btcusd
Past 2 years (from 2019):
Lowest price: $3,322
Highest price: $64,895
Increase percentage: 1,853.49%

Past 5 years (from 2016):
Lowest price: $310
Highest price: $64,895
Increase percentage: 20,833.87%

Past 10 years (from 2011):
Lowest price: $2.1
Highest price: $64,895
Increase percentage: 3,090,138.09% (that's 3 million percent!)

Do you think Bitcoin will continue to see big percent of increase in value in the next 2-5 years or do you expect Bitcoin inflation to reduce quickly now that we have seen huge gains in the last 5 years?

Bitcoin doesn't have inflation, but yes I believe we will continue seeing big rises for the foreseeable future until we reach mass adoption which is not going to happen at least for another 10 years.

[Lucius]

I believe that some who read your post sincerely doubt the accuracy of your data because it seems unreal to them

After reading your comment I have to do some little google search before commenting here, you are right the data is not correct I hope to see it edited and updated with the right data.

I did not write that the data are not accurate, but that some people (like you) will doubt them, which turned out to be correct. In some conversations with friends and acquaintances I just presented this kind of information and people looked at me in amazement as if I were telling some lies or nonsense. It’s hard to accept that something can have such huge growth in a relatively short amount of time, and even if for someone 10 years is a very long period, 5 years is certainly not a period that should be a problem for anyone.

[RILWAN]

Even countries are now adopting Bitcoin and are investing their liquidating country reserve and budget into buying Bitcoin because they are now aware of the possibility of Bitcoin being the escape route to inflation. As the inflation ratios of many countries are on the rise, deflationary currency like Bitcoin becomes the only choice.

[BlackHatCoiner]

I think that Bitcoin is, at the moment, possibly the greatest investment and store of value. Think about it: Everyone seems to be entering within the next years, some have already switched to it, it has better characteristics than gold, which means a matter of time. Not to mention its annual yield.

It's surely the hedge against inflation and who knows what's waiting for us and the GDP within this decade. Buy Bitcoin, hold it and enjoy the safe haven.

do you expect Bitcoin inflation to reduce quickly now that we have seen huge gains in the last 5 years?

Inflation of Bitcoin reduces steadily every 210,000 blocks. We don't expect it to reduce quickly or slowly. We don't even expect anything; we know the inflation rate Bitcoin has and will have for the rest of its existence.

[hugeblack]

The only thing that can connect bitcoin to traditional markets are interest rates, which make keeping cash is useless with inflation rates and therefore they may invest in alternatives, bitcoin may be one of the options with a pack of gold, silver , Real estate, stocks and others.

anyway, changing by 5% is normal in bitcoin daily price movement.

[Shenzou]

Bitcoin as a deflationary currency has sustained its position as the only exit from inflation as Bitcoin continues to move above every form of resistance from the Central currency which is an inflationary tool in the hands of the government and the central banks.
Bitcoin made a 9.3% price increases against the United States dollars on the first day of October a move that happens on a day the US Department of Commerce announced the 0.3% increase in August and 3.6% over a year.

I think that bitcoin is great way to protect against inflation, because as we are seeing with the constant problems that are going on in the world the drawback of covid the governments are constantly trying the fix a problem with a solution that will heavily affect the economy on the long run, and because of how bitcoin and crypto market somewhat is independent from all of this and is backed by its own values and and people that are believing in it and being moved independently from all the assets.

[DeathAngel]

Looking like a damn good hedge against inflation in 2021 & we still have Q4 of the bull run to come. Today has been a great day for bitcoin, up 10% with more to come I think before New Year.

 

[Fesatmas]

The more Bitcoin grows, the more resilient it is to all weather inflation. the fact that apart from being a fence can also make everyone unable to say that this is a lie. Bitcoin has definitely achieved things that no one could have predicted. So that the number of companies that have looked at Bitcoin certainly makes them believe that all this time Bitcoin can save them when the economy is destroyed because too much money is printed.

There are some of them who are still unaware and selfish when they are hit by a pandemic. Stick with fiat and all its properties. But if you see them now, they are only spectators (not connoisseurs).