Bitcoin’s Inflation Rate 3 Times Lower Than US Dollar

Bitcoin’s inflation rate has dropped significantly over the years, making it a potential hedge against economic uncertainty and inflation. With over 90% of Bitcoin in circulation, the asset’s inflation rate is now three times lower than that of the US dollar.

Bitcoin’s fixed supply of 21 million BTCs is the reason behind its dropping inflation rate, which decreases after every four years during the halving event. As a result, the inflation rate has been steadily declining since its inception in 2009, currently standing at 1.79% as of March 4, according to WooBull.

In contrast, the US dollar’s annual inflation rate for 2023 is 6.4%, making the inflation rate 3.57 times higher than that of Bitcoin. The US dollar’s value has declined over time due to excessive printing and the diminishing purchasing power of each dollar.

Experts believe that Bitcoin’s decentralization nature, which allows it to circumvent most political and economic risks linked with the US dollar, is another reason behind its lower inflation rate.

As a potential hedge against inflation, Bitcoin has become a topic of debate among investors. While proponents argue that BTC is the ideal asset to protect against inflation, its price has yet to reflect this amid rising inflation and interest rate hikes. Additionally, Bitcoin and the broader cryptocurrency market have suffered significant losses amid the economic downturn.

Despite these challenges, Bitcoin’s inflation rate and deflationary model continue to make it a compelling investment option. By press time, BTC was trading at $22,382, and with the next halving event estimated to take place in May 2024, investors may continue to view it as a promising long-term investment.

For more articles visit: Cryptotechnews24