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Author Topic: Is Bitcoin anti-inflation?  (Read 363 times)
Liamttw
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August 13, 2021, 09:27:22 AM
 #41

The so-called inflation refers to the instability and inflation of currency value caused by the central bank printing a large amount of currency under the conditions of currency circulation.

Bitcoin has a large amount of computing power, is anonymous and has strong hedging properties. And its limited supply will not be issued randomly like national legal currencies, Bitcoin can effectively resist inflation.
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junmisakiro
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August 13, 2021, 09:43:19 AM
 #42

I don't think any asset is completely anti-inflation, because every asset has its own risks and advantages, whether it's bitcoin, gold or real estate.

But no at this time.
Is gold anti-inflation?
Check out gold price if you wish,  then think why.
Yes, four years ago, gold prices were at the worst level, this is because investors became panicked due to the US employment data report that sparked concerns over the US central bank.

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August 13, 2021, 12:26:40 PM
 #43

As a person who really loves BTC, I want to ask, is Bitcoin anti-Inflation?


Deflationary design is incorporated in BTC. But if the goal was to create a pure inflation protected asset, I think there would be more safeguards and features built in to deter volatility.

Inflation alone is neither good or evil. Its a symptom of markets that manifest under certain conditions.

The problem is high risk will always be correlated with high profits. National mints sometimes overprint currency to bailout poor investments made by high rollers in public and private sectors. Leading to economic instability and inflation. The more underfunded programs and investments are, the higher the volume of fiat necessary to bail them out.

Bitcoin definitely represents an improvement over current markets and financial structures. But I do not think its fair to label it a pure inflation protected asset or something that was designed to be anti inflation.

If Bitcoin changes the governmentmint's system of printing money at will, what will these companies do if some companies or infrastructure have loopholes in bad assets, but they cannot print money as they do now?
There is another possibility. One day, 1 million US dollars of Bitcoin will be used to rivet the currency of the world. The fiat currencies of other countries still exist, but Bitcoin must be rivetted. At that time, the government needs to print money to help companies or infrastructure. What should the government do?  What kind of scene will it make?
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August 13, 2021, 01:27:27 PM
 #44

I don't understand why almost everyone focuses on money printing when it comes to inflation.
Just the other week I remember a somewhat similar discussion and there was the example of Japan, money printing yet deflation.

I'm amazed how these days there are still millions out there who just shout money printing but they don't have a clue what is next in the line after that, and this is the whole difference between having inflation or not. The government or the central bank or whoever has the authorities in this in a country can inject money and send them as paychecks to everyone, you will have more money in circulation, more money poeple are willing to spend, the same amount of goods, you're going to have inflation in consumer goods. The government decides to spend all this money on a project for the infrastructure the inflation will be close to zero, and if the in some cases even bringing in cheaper goods, one example would be an investment in irrigation. The same stands for military spending, you won't see a 10% rise in cornflakes prices because the US is building more nukes.

There is no inflation without increased consumption or decrease in manufacturing, or both of them combined.
Everything comes with the profile of the participants an economy, it doesn't matter if it's gold of bitcoin or fiat, in case of a shortage or break of supply chains like it did with tens of products over the last year bitcoin is not going to help you, it is not going to simply increase its value against the dollar by the same rate as the inflation, things in the economy don't work like this, otherwise, we wouldn't have had countries and citizens going bankrupt before paper money was invented.




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August 14, 2021, 08:27:46 PM
 #45

Overall, the bitcoin protocol is much more than forkable software; it also determines the rate at which new currencies are produced and how quickly the rest of the world adopts bitcoin. It will fail if you miss one parameter.
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August 15, 2021, 05:16:01 AM
Last edit: August 15, 2021, 09:13:08 PM by odolvlobo
 #46

I don't understand why almost everyone focuses on money printing when it comes to inflation.

The reason is that inflation is defined as money printing in some camps, and rising prices are the result of inflation.

The more current/modern definition of inflation is the opposite. Inflation is rising prices, which can be caused by money printing in addition to other factors.

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lepbagong
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August 15, 2021, 08:29:12 AM
 #47

According to many analyzes, inflation is caused by the printing of money by the Central Bank. Excessive printing of money will create an imbalance in supply and demand, which will have a negative impact on the balance sheet.
As a person who really loves BTC, I want to ask, is Bitcoin anti-Inflation?

Bitcoin can indeed act as a hedge against inflation due to its limited supply, meaning when there is a demand for bitcoin, the price per coin will go up, but given the highly volatile risk, I think bitcoin is better used as an investment.
this is one of the advantages of bitcoin compared to fiat, where fiat has been used for a long time than bitcoin. bitcoin is clearly very limited in number and cannot be increased, in contrast to fiat which can change and increase in number depending on the foreign exchange/gold stock owned.
so that inflation will occur in fiat not for bitcoin, so bitcoin is suitable for investment.

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August 15, 2021, 09:37:56 AM
 #48

I really don't know if this bitcoin can be an anti inflation asset or not. Bitcoin had a price of $0 when it was first introduced by satoshi. Maybe initially bitcoin was created as an asset that experienced inflation in its first years, but so far it is possible that the percentage of inflation will go down. Getting a little extra information from the bitcoin.org site, I don't think bitcoin was created as an anti-inflation asset, but there's always a chance that inflation won't happen on a much larger scale.
From my perspective i don't think bitcoin can go down any longer, no matter how the inflation of economy in any country or worldwide economy, using when bitcoin was introduced as case of study or reference it's obvious that bitcoin was at zero in value during 2009, but now the value is different, cryptocurrency generally inflation will keep on accelerating instead of deduction in value, in actual sense our objectives is to make a contribution that will make it  or enable it to be rising.

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Hughes_Ryan
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August 15, 2021, 09:50:07 AM
 #49

I don't understand why almost everyone focuses on money printing when it comes to inflation.
Money printing/inflation has a very close correlation. Printing money only helps to increase the price of materials and goods while the production volume remains or lower. This causes inflation, every year the rate of inflation continues to increase due to the process of printing money from the government. Bitcoin has a fixed supply and is derived from hard mining, it represents the ratio of supply/demand met with value.

jinneas
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August 16, 2021, 06:05:31 AM
 #50

With the outbreak of the epidemic, central banks of various countries have introduced economic stimulus measures to support the market and economy. Bitcoin's anti-inflation characteristics have played an important role.
The essence of inflation is that the currency is over-issued, and the total amount of Bitcoin is constant at 21 million. The decentralization of Bitcoin means that no one in the world can monopolize the income of this asset appreciation. No one can over-issue, and no one can manipulate this market. It does not rely on the issuance of a specific currency institution, and is generated based on a specific algorithm and through a large number of calculations. It has anonymity and can play a role in anti-inflation when the economy is down.

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