It is no more news that the number of people who now buy Bitcoin either to keep or on a trading basis is gradually increasing. With the surging inflation rates in the world’s major countries, probably because of the high oil prices and the Russian invasion of Ukraine, countries have moved to find an alternative to remedy the situation. While some countries are still looking for a working theory that could get them out of the situation, others are choosing the easy part: crypto. Experts have tagged crypto as an inflation resistance instrument, an easy role in reviving a dying currency.
More people are getting more interested in buying bitcoin as much as possible. Although some critics have continued to criticize the integration of cryptocurrencies into the system, insisting that they can never be equated with real-world assets. But such a claim is starting to become outdated, considering that cryptocurrencies have solved the world’s money problems.
Actually, to some countries, adopting bitcoin as a means of fighting inflation is not their first choice but rather a stumbled-upon method that could be a panacea to their economic plight, thus, hedging on it. Meanwhile, bitcoin as a solution goes beyond being used by countries; individuals can also leverage it as a way of dodging inflation; all you need to do is divert your servings to crypto until the inflation period is over. But before you take the first step to buy Bitcoin or its equivalent, you must understand what inflation is and its concept.
Economic experts use inflation to describe the prices of goods and services over time. Let’s assume that you bought tin milk for $4 before the current rise in US inflation; the price of the same tin milk is expected to sell at $6 or $7 during this time (of inflation). This is mainly because the country’s currency had devalued, causing the unit of a currency to buy less than what it used to before the inflation started. So, what is inflation, how does it affect every nation’s economy, and how do the actions of people that buy bitcoin affect it?
Inflation devalues the country’s currency and makes it worth less than it used to. So, the best thing to do now is to deflect it using any known economic theories that back the currency. Cryptocurrency has always been seen to be the best way to fight inflation. One of the reasons is its decentralized operation pattern: it gives power to every user. Many factors trigger inflation in every country, while some can be manufactured: political, others can be naturally driven, e.g., the coronavirus.
The United States is experiencing one of the worst effects of inflation, as the inflation rate has increased for the first time to 8.5% from 1%. Britain is not having it good either, as their inflation rate has increased to 7% as well, with items like groceries and other forms of private sector rents being the most affected. To beat the increasing inflation, the US Feds have increased the interest rate to save the dollar. But the good news is that they are also considering going crypto; that way, they can give the traditional fiat currency a chance to normalize.
Buy Bitcoin, Beat Inflation
Cryptocurrency advocates have always believed that the continuous printing of the fiat currency will further lead the global economy into a disaster. This is exemplified in countries like Zimbabwe, Venezuela, and Turkey, where experts believe that they have ruined their economies by total reliance on the traditional management of the economy, which includes constant printing of money.
By legalizing cryptocurrency and letting people buy bitcoin for their everyday transactions, you are giving your traditional currency a chance to breathe; you are giving it a chance to make a comeback.
This is because bitcoin doesn’t pay allegiance to any centralized authority, be it banker, government, or system: it is decentralized. And because some economic critics believe that their government deliberately initiates most inflation in a country to achieve some anti-people objectives, bitcoin is excellent resistance to such activity.
Unlike the traditional economy, where the government controls the amount of money in circulation, bitcoin is not like that. The bitcoin protocol is the major determinant of the amount of bitcoin issued in the public space, as in, how many bitcoins an individual can possess; not even the miners can determine that. So, before buying bitcoin, know that the current market supply is expected to be exhausted by 2140. While the traditional economy uses the activities in the market, bitcoin operates like a clockwork: it isn’t always controlled by human psychology.