Is bitcoin inflation wilder than fiat?

[Solosanz]

Can you name one country besides Salvador (which btw did so before the war) that has done such a thing?
Furthermore, Salvador still uses the $ and with the latest polls coming from there, even the population does so more than Bitcoin.

Elsavador is one, and followed Panama next.

Wrong.

The second country which accept Bitcoin as legal tender is Central African Republic, Panama is just friendly to Bitcoin, they have a plan to legalize Bitcoin but the president reject it [1]. There are a lot countries which want to legalizing Bitcoin as legal tender, the strong contenders are: Venezuela, Paraguay and Anguilla.

However even though both Central African Republic and El Salvador already accept Bitcoin as legal tender, the adoptions aren't that high and many people are tend to use their own local fiat. It's really a lot task if you're want to hope majority will use Bitcoin rather than their local fiat.

[1] https://www.bloomberg.com/news/articles/2022-05-19/panama-president-will-refuse-to-sign-crypto-law-in-current-form

[1714815696]

1714815696

[1714815696]

1714815696

[1714815696]

1714815696

[o48o]

-cut-
Like fiat, who would have thought be popular than gold?.
the gold standard was abolished since 1934 and changed to the fiat standard now, but we know fiat is just paper that doesn't have value if there is no government judgment, some smart people understand that and begin to accumulate bitcoins on the safe box because they know fiat standard will die soon like old brother, gold.

Fiat money has nothing to do with bitcoin, they have whole different purpose to exist. They are not in competition with each other so bitcoin won't be killing fiat standard nor it can replace it because bitcoin doesn't serve the same purpose. If old fiat standard gets killed it's because it has transformed to something more efficient.

Neither bitcoin is competing with gold. Saying that gold would die doesn't mean anything. Where does it go? Will we get rid of it and shoot it to space or something?

Please be more specific when you make such claims.

[Smartprofit]

We know Inflation has become a frightening specter in 2023 because of covid and Ukraine and Rusia war. This is related to crypto, I am not sure if crypto price today has grown up in the line without following the fiat. Yes, fiat aka conventional money is the factor we pursue to bitcoin.

Many countries have thought to change currency into bitcoin because the government thinks bitcoin is more related stable than USD. because the reality, USD is not have something great if their foreign policy isn't great in the past. The powerful country is just running their greedy for self-benefit. Now, they begin to turn to bitcoin and look like started to control the bitcoin inflation, so what you think if bitcoin inflation is wilder than fiat?

Bitcoin has inflation that decreases over time.  This is implemented through a mechanism such as halving. 

In addition, Bitcoin inflation is decreasing due to the constant withdrawal of coins from circulation.  The withdrawal of coins from circulation occurs due to the loss of access of holders to their wallets (due to death or negligence).  Fiat currency inflation depends on the economic situation in the market and on the actions of regulators (for example, Central Banks or the US Federal Reserve). 

The inflation of fiat money and Bitcoin is very difficult to compare with each other - they are different concepts. 

But we can say that in the long run, fiat currencies are an inflationary asset, and Bitcoin is a deflationary asset.

[DanWalker]

-cut-
Like fiat, who would have thought be popular than gold?.
the gold standard was abolished since 1934 and changed to the fiat standard now, but we know fiat is just paper that doesn't have value if there is no government judgment, some smart people understand that and begin to accumulate bitcoins on the safe box because they know fiat standard will die soon like old brother, gold.

Fiat money has nothing to do with bitcoin, they have whole different purpose to exist. They are not in competition with each other so bitcoin won't be killing fiat standard nor it can replace it because bitcoin doesn't serve the same purpose. If old fiat standard gets killed it's because it has transformed to something more efficient.

Neither bitcoin is competing with gold. Saying that gold would die doesn't mean anything. Where does it go? Will we get rid of it and shoot it to space or something?

Please be more specific when you make such claims.

What he is saying is just his misconceptions and without any proof for his claims. Even if bitcoin competes with fiat or gold, bitcoin will never be able to replace fiat, no government organization will do that except in countries with bad economies.

Although bitcoin is deflationary, it has so far been suitable only as a speculative asset. Many say that only bitcoin can reduce inflation, but look at what the Fed is doing, US inflation is falling without bitcoin.

Our economy is thousands of years old, and bitcoin is only 14 years old; bitcoin is outstanding because it gives us huge opportunities that no other asset can give us. But it can't replace fiat or gold, it's a fact we shouldn't run away from.

[NotATether]

This is false, you can come in through another angle but i can bet you not on this, bitcoin is highly volatile and cannot be stable as USD is, as a matter of fact USD is not a volatile currency but only experience much of inflation rather than being volatile, try to conduct further more research about this, government first thought about going against bitcoin because of it high volatility should in case you don't know, they believe it could pose high risk on investors by loosing their entire assets invested.

You're right on the spot about the volatility vs inflation difference. They are not the same thing, completely different actually.

Inflated currencies usually do not go down after they go up. That's because it's very difficult, from a phycological point of view, to burn money or otherwise take it out of circulation (something that altcoins do routinely), because everyone craves for more cash.

Volatile currencies though, can either go up or down, but this action is done spontaneously (provided that it's a decentralized coin) and not by the whim of any person

[Adbitco]

No country is trying to change their currency to bitcoin rather they are only trying to redesign their currency. For instance, my country empathically are trying to redesign their notes not because they want their notes to be bitcoin entirely. Besides bitcoin is not yet to be generally legalized, but can be used as an alternative means of payment across the country that is accept bitcoin trading.

[kryptqnick]

Some points of the op don't make sense to me and seem factually false. Even El Salvador didn't abandon the USD for Bitcoin but instead uses both. As for stability, the USD is obviously more stable, but Bitcoin can grow in value, whereas the USD is unlikely to do so, and if the USD inflation stopped, it would be considered undesirable. Bitcoin is volatile, which during the bear market can have practical impact of a fiat currency suffering from high inflation, but as others have mentioned, volatility and inflation aren't the same thing.

[stompix]

Can you name one country besides Salvador (which btw did so before the war) that has done such a thing?

Elsavador is one, and followed Panama next.

Has, at is has already implemented not that it plans to do so.
And even if you would consider future plans as making the requirement, two is obviously not the "many" you have claimed, not even mentioning the fact that you said change:

Many countries have thought to change currency into bitcoin

Adopting another currency is not changing the one they use, they are just exploring another system, not dropping the US, and neither will Panama if they do make BTC

The bill was introduced in September 2021, aiming to make the country “compatible with the digital economy, blockchain, crypto assets and the internet.” It was moved out of the Economic Affairs Committee on April 21 and approved a few days later. Based on the legislation, Panamanians “may freely agree on the use of crypto assets, including without limitation Bitcoin and Ethereum” as an alternative payment for “any civil or commercial operation.”

This is nowhere near completely replacing a monetary system with another one.
I can understand optimism on future possibilities but one does live in the present, just because we're back on track and we're no longer watching red candles day after day doesn't mean everything has changed in the world also.

[Lubang Bawah]

In my opinion no, when there is a storm or inflation of cryptocurrencies, it does not have a direct impact on the economy, in contrast to inflation in Fiat that makes shock and direct difficulties on the community, and it is proven that inflation in Fiat that occurs in many countries makes poverty and asset sales to foreigners so that inflation Fiat is a storm that is difficult to overcome.

[Sarah Azhari]

The second country which accept Bitcoin as legal tender is Central African Republic, Panama is just friendly to Bitcoin, they have a plan to legalize Bitcoin but the president reject it [1]. There are a lot countries which want to legalizing Bitcoin as legal tender, the strong contenders are: Venezuela, Paraguay and Anguilla.

I don't know what they're afraid to take the time to make a decision. Libya plans to create a single African currency because use gold where USA don't have much. If bitcoin, we know USA is 1 the most bitcoin holder in the world, they'll just agree if Venezuela, Paraguay and Anguilla use it for currency.

[MarjorieZimmermanGinger]

We know Inflation has become a frightening specter in 2023 because of covid and Ukraine and Rusia war. This is related to crypto, I am not sure if crypto price today has grown up in the line without following the fiat. Yes, fiat aka conventional money is the factor we pursue to bitcoin.  

If talking in general about crypto then the impact of inflation affecting crypto is still a possibility but if you mention bitcoin it has absolutely no effect on my knowledge. If you want to see references, then try to study the Covid-19 case, where the price of bitcoin is still able to maintain its value and even reach ATH in 2021 and in my opinion the price of bitcoin has never followed fiat.

Many countries have thought to change currency into bitcoin because the government thinks bitcoin is more related stable than USD. because the reality, USD is not have something great if their foreign policy isn't great in the past. The powerful country is just running their greedy for self-benefit. Now, they begin to turn to bitcoin and look like started to control the bitcoin inflation, so what you think if bitcoin inflation is wilder than fiat?

Your assumption in this paragraph is wrong in my opinion, not many countries think they want to change their currency to bitcoin, this is against the rules of every country that already has fiat currency, for example maybe El Salvador from one of the countries that makes bitcoin as currency which is legal, and even then because they do not have an official currency in the country.

Inflation has a meaning as a price increase and if it is associated with bitcoin then bitcoin is wilder against ongoing inflation, but in the sense of a sudden increase in price. But the speculative nature of bitcoin shifts the pattern of feeling between the suitability of pinning inflation to the journey of bitcoin. After all nobody can control bitcoin inflation, because it goes against decentralization.

[19Nov16]

Slowly, bitcoin's power is getting bigger, bitcoin is getting bigger, with the current market cap reaching around $ 450 billion, of course, this is a very large value, naturally, if there are high price fluctuations, it will become trending on television and social media, but most who invest in bitcoin are anonymous so when inflation occurs so it doesn't have much impact on the economy directly.

[justdimin]

The second country which accept Bitcoin as legal tender is Central African Republic, Panama is just friendly to Bitcoin, they have a plan to legalize Bitcoin but the president reject it [1]. There are a lot countries which want to legalizing Bitcoin as legal tender, the strong contenders are: Venezuela, Paraguay and Anguilla.

I don't know what they're afraid to take the time to make a decision. Libya plans to create a single African currency because use gold where USA don't have much. If bitcoin, we know USA is 1 the most bitcoin holder in the world, they'll just agree if Venezuela, Paraguay and Anguilla use it for currency.

I think those smaller nations with not so great economy should turn to legal tender crypto so that they could end up with a lot more money in the country. Not only they would be able to tell their citizens to go make money that way, but they would be able to actually do something about it as well. That way they could tax the people in bitcoin, and use that to keep it in the books and that way treasury would grow whenever bitcoin goes up.

I get that when it goes down that looks bad, but nations do not need to cash out too quickly anyway, so they could just keep holding longer than any other person, in fact they could never cash out and just keep holding it forever.

[Sarah Azhari]

and in my opinion the price of bitcoin has never followed fiat.

We can't see crypto exchange anymore if all thinking like you, no more people exchanging bitcoin for fiat and people will save it in noncustody wallet. Then, in the future, bitcoin will be high-value asset than anything in the world, no more inflation and no one people to control it.

I get that when it goes down that looks bad, but nations do not need to cash out too quickly anyway, so they could just keep holding longer than any other person, in fact they could never cash out and just keep holding it forever.

yes, there is no other way than that (holding it forever), because that's all it's worth and makes the economic country change 360 degrees if they believe it on future.

[MarjorieZimmermanGinger]

We can't see crypto exchange anymore if all thinking like you, no more people exchanging bitcoin for fiat and people will save it in noncustody wallet. Then, in the future, bitcoin will be high-value asset than anything in the world, no more inflation and no one people to control it.

If you understand in full what I say in the previous post, this is not a matter of thinking, but rather to the reality that occurs, how can we not see the exchange while we need it in transactions, then for countries that have not received Bitcoin as a transaction tool and of course they have to exchange bitcoin to Fiat, even in El Salvador itself Fiat is still used even though the adoption of Bitcoin has reached the perfect stage, try rereading the purpose of my previous comments.

Bitcoin is indeed a high-value asset from other products that have ever existed and have even been proven to be able to maintain investment value, the fact is that no one is able to control the price of bitcoin because of its decentralized nature. Inflation I mean only within the scope of meaning as a price increase, because if interpreted correctly that inflation is an increase not a measure to control.

[Pejoh Asu]

Of course if bitcoin inflation occurs then it's not wilder than fiat, this is because bitcoin's market cap currently reaches $450 billion spread all over the world, so when bitcoin problems occur like last year it dropped more than 65% but didn't really have an impact on the economy, bitcoin inflation didn't affect commodity prices, whereas fiat inflation greatly affects any price.

[fadhilz123]

Slowly, bitcoin's power is getting bigger, bitcoin is getting bigger, with the current market cap reaching around $ 450 billion, of course, this is a very large value, naturally, if there are high price fluctuations, it will become trending on television and social media, but most who invest in bitcoin are anonymous so when inflation occurs so it doesn't have much impact on the economy directly.

Things like what you said have also happened to Bitcoin in the past where Bitcoin has become a trending topic in television news and social media when an extraordinary increase occurred in 2021. And it is still very likely to happen again to Bitcoin when Bitcoin want to touch a new ATH in the market, although I don't think that it can happen in this year because a correction is still very easy for Bitcoin in the market now.

[serveria.com]

We know Inflation has become a frightening specter in 2023 because of covid and Ukraine and Rusia war. This is related to crypto, I am not sure if crypto price today has grown up in the line without following the fiat. Yes, fiat aka conventional money is the factor we pursue to bitcoin.

Many countries have thought to change currency into bitcoin because the government thinks bitcoin is more related stable than USD. because the reality, USD is not have something great if their foreign policy isn't great in the past. The powerful country is just running their greedy for self-benefit. Now, they begin to turn to bitcoin and look like started to control the bitcoin inflation, so what you think if bitcoin inflation is wilder than fiat?

The first and foremost: with Bitcoin there is NO inflation, because the supply is finite. You can't print or create more Bitcoins. So, I'm not sure about what Bitcoin inflation you're talking here.

Secondly, no countries have and/or are planning to make Bitcoin their national currency. Instead, countries are accepting Bitcoin as legal tender.

[bitgolden]

Of course if bitcoin inflation occurs then it's not wilder than fiat, this is because bitcoin's market cap currently reaches $450 billion spread all over the world, so when bitcoin problems occur like last year it dropped more than 65% but didn't really have an impact on the economy, bitcoin inflation didn't affect commodity prices, whereas fiat inflation greatly affects any price.

I think the logic is that the price of bitcoin goes down, which means the amount of bitcoin you need to use in order to buy something changes and you end up spending more of your bitcoins to buy the same thing, which is basically what fiat inflation is about as well.

If there was one thing for 60k and you could buy that with one bitcoin, but now need to spend 3 bitcoins, that means there was an inflation, we could also say due to fiat inflation at the same time if it happens, price could jump to 80k and now you need to spend 4 bitcoins. The logic is similar in fiat, you buy one thing for 100 bucks, and tomorrow you spend 200 for it, the amount of money you spend goes up.

[19Nov16]

We know Inflation has become a frightening specter in 2023 because of covid and Ukraine and Rusia war. This is related to crypto, I am not sure if crypto price today has grown up in the line without following the fiat. Yes, fiat aka conventional money is the factor we pursue to bitcoin.

Many countries have thought to change currency into bitcoin because the government thinks bitcoin is more related stable than USD. because the reality, USD is not have something great if their foreign policy isn't great in the past. The powerful country is just running their greedy for self-benefit. Now, they begin to turn to bitcoin and look like started to control the bitcoin inflation, so what you think if bitcoin inflation is wilder than fiat?

If the state legalizes bitcoin to replace fiat then if there is inflation the impact will be deeper and terrible, it is inconceivable if the very volatile bitcoin price is used by the state for any reason, the central bank certainly can't do anything, moreover the strength of state capital is very small compared to the market cap of bitcoin, and the fact that many developing countries have foreign exchange reserves of only 10% or less than bitcoin's marketcap.