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Can Crypto Truly Outperform Inflation?
Are tokens such as Bitcoin “digital gold”? And, if so, do they have what it takes to battle inflation, the scourge that has engulfed fiat currencies worldwide?
Crypto has been lauded as an inflation-proof asset and a digital equivalent of gold. But how precise are these descriptions? With inflation on the increase, the solution may be just around the corner.
Inflation Is a Problem
Everyone who has fiat savings is terrified of the dreadful I word. But, after years of low or near-zero inflation in many areas of the world, it appears we can no longer avoid predictions of an impending inflationary storm.
Much of the economic discussion in 2021 will revolve around inflationary hotspots such as Turkey, Argentina, and Venezuela.
While these were formerly thought to be anomalies, nations that have been living without inflation for decades are suddenly reporting alarming rates. Central banks in nations such as the United Kingdom and the United States are currently under growing pressure to raise interest rates in order to combat inflation.
However, the issue cannot be so easily brushed off. Wages in the West are rising, food costs are rising globally, and energy price increases are becoming more prevalent.
