#Binance #BTC #crypto2023 #inflation
Inflation and deflation, both terms in financial terminology, are among the most troubling words in any economy.
Prices of commodities are rising sharply while wages remain stagnant, meaning inflation is at its peak globally. With crypto prices falling sharply, investors who believed that Bitcoin and cryptocurrencies were an essential hedge against inflation wonder if they made the right choice.
Inflation vs. deflation
Inflation happens when a currency’s supply gets so high that it loses its value or buying power. Deflation, on the other hand, refers to the situation where a currency’s value or buying increases in reference to short supply. Fiat or traditional currencies are mainly inflationary since central banks can and constantly increase their supply. Cryptocurrencies, on the other hand, are primarily cryptocurrencies deflationary in one way or another.
As inflation continues to bite globally, the debate between inflationary vs. deflationary cryptocurrencies is gaining momentum. Don’t fret if you find these terms overwhelming. Our article will dissect the subject of inflationary vs. deflationary crypto assets, explain the difference between them, whether they can fight inflation and why you must pick the right one.
