If Bitcoin Isn’t an Inflation Hedge, What Is It?

[Livingleged]

We know that Bitcoin is a hedge against systemic and sovereign risk rather than inflation. its broader value proposition remains intact and role as a digital gold and a neutral, global financial asset that is particularly attractive in a world of capital controls.

In this context, do you think Bitcoin’s price will be less responsive to short term inflation information?

It is definitely a hedge against inflation without any doubt from what I’ve seen known and passed through if you compare it to fiat in the past few year you’ll realize how inflation has eaten up the value of those fiat currency while bitcoin gain more value regardless of its price fluctuation due it volatility. there for it is for sure a hedge against  inflation without any doubt and any other saying might not go well with me as I will disagree.

[death69]

The inflation hedge thing was always a gateway drug, not the destination. Individuals required a common reference point to know why Bitcoin was important. Wwe gave them one: it is as gold but digital, it keeps you out of money printing. True enough in a narrow sense. However. it flattens what is really occurring.

The actual role of Bitcoin is a valid exit. Get out of money policy you did not agree to, of monetary systems that spy on and marginalize, of the belief that money should be political. One of the symptoms of those underlying issues is inflation.

The price will do what it does. The network does not stop either way. It is the one that counts, I suppose. The rest is nothing but people trying to explain something that does not fit well into old categories.

[YOSHIE]

In this context, do you think Bitcoin’s price will be less responsive to short term inflation information?

In general, you can see expectations of changes in interest rates and prices of goods at any time which causes inflation to increase, that is the purpose of Bitcoin being created and designed to fight inflation, the real reason Bitcoin is a safe asset as a store of value.

This can be proven, Bitcoin was created to have a limited supply, fixed supply, decentralization, and liquidity because it is one of the forces and efforts to protect against inflation, As is known, Bitcoin only halves once every four years, Overall, it can be said that Bitcoin is a strategic step to hedge against inflation as seen and occurring currently.

[Hyphen(-)]

In this context, do you think Bitcoin’s price will be less responsive to short term inflation information?

For short term inflation I don’t think Bitcoin price will highly responsive to inflation because the market can be manipulated sometimes and it do take some times to recover and take the right path, so it depends on how long you are referring to as your short term duration.

If you want to get the main benefit of Bitcoin in all aspects be it inflation or high profit, you need to hold your Bitcoin for long period of time, minimum of 2 years so that another cycle will come and the price will have effect to either halving, bear and bull market, and you will be able to know the right thing to do when you see the profit you will have. But investing for sort term will not give you big profit and might not even save you from inflation.

[Z-tight]

BTC is a hedge against inflation, but what it is not is a safe haven asset. BTC is very volatile and you could purchase it to hedge your funds against inflation and right the next day it loses 30% of its value. A new investor would be going crazy if that happened to them and they will be cussing whoever spoke to them about BTC. But if this investor is in for the long term and ready to be patient, then in the long run they would find out that BTC has done exactly what they bought it to do.

However, precious metals like gold and silver remain the most suitable option if you seek a safe haven asset to protect your funds from inflation. Or you seek an asset that is immune to political actions and economic situations.