Is $BTC Inflation Proof ? Let’s ask to M. Friedman !
Let’s begin with a quote from Milton Friedman: “Inflation is always and everywhere a monetary phenomenon. " 💵 💵 📉
Inflation occurs when money loses buying power. While politicians might attribute inflation to energy prices, wars, and other factors, the primary cause is often excessive money printing by central banks
=> 🏦 -> 🖨️ -> 💸 💸 💸 = 🥜.
This concept can be summarized by the quantity equation, or the equation of exchange: MV = Py, where:
• M is the money supply, • V is the velocity of money, • P is the price level (typically measured by the CPI), • y is the real gross domestic product.
The equation shows that the price level (P) is directly proportional to the money supply (M). To maintain stable inflation, the production of goods and services (y) must keep pace with the money supply.
Bitcoin ($BTC ) is designed to be inflation-resistant. Its halving system reduces the rate at which new bitcoins are produced, mimicking the scarcity of gold. Unlike central banks, no entity can alter Bitcoin’s issuance rate. Additionally, Bitcoin’s supply can be lost or destroyed (e.g., through lost hard drives), further reducing the available quantity.
These factors suggest that Bitcoin’s buying power may increase over time, making it a potentially inflation-proof asset.
What do you think ? Would trust more $BTC to keep or the dollars 💵 to keep safe your capital ? 😉
From a fundamental economic perspective, value can be categorized into two types.
The first type of value is defined by scarcity, much like gold. People are willing to pay high prices for scarce resources. Bitcoin falls into this category, with its value intrinsically linked to its scarcity, reinforced by the halving system.
The second type of value is defined by utility. People are willing to pay more for tools that enhance efficiency and productivity. Ethereum ($ETH ) fits this category due to its functionality in enabling decentralized applications. However, newer alternatives like Solana ($SOL ) (offer more efficiency in terms of speed and options.
Thus, the essential question is: would you prefer to invest in scarcity or utility ?
Will $BTC doom 📉 if a semiconductor crisis happen ? what could be the consequences on the crypto market ? Let’s develop a bit :
I won’t teach you that TSMC the biggest semiconductor maker ☝️. TSMC has security system in case of emergencies they can remotely destruct 💥 🖥️ the EUV machine* (the machines use to make semiconductor).
If they destroy them all, the tech market will dramatically doom ! Remember of GPU shortages during 😷 ?
It’ll be a joke 🃏 compared of what’s is coming. So if AMD,Intel,Nvidia has no GPU/CPU to sell the stock market of semiconductor will plunge… and there is a high correlation between the nasdaq and the $BTC **.