The volatility of bitcoin comes from supply and demand. Not many bitcoin exist or is not being produce anymore. So the more people who want to own it or use it for purchases or as money don’t have any being that it is not being freely printed like the dollar by banks. So the more people that put faith into bitcoin like they have/had faith in the dollar. The dollar gets cheaper the more that are just printed and put in circulation. Bitcoins value rises because the digital fiat is limited and wanted for use. It can also be broken down into fractions way smaller then quarters, dimes, nickels and pennies and still represent any value that fraction of is considered of a full coin.
The advantages of a fiat currency is access, use, and something that is not necessarily government controlled such as US dollar. Banks can’t just go an print new Bitcoins to control the economy. Disadvantages is that it is not backed by a commodity nor anything physical. It isn’t even paper. It is something just in the ether or a number on a screen. However the dollar is damn near the same thing right now. It is backed by a government promise that the US dollar will always be worth something. That something is always changing though ever since we were taken off the gold standard. The US dollar is no better than a colorful food stamp. What if the government falls or the US dollar is no longer the standard? Say is the Yen or Frank, then even the digital numbers the bank claim they are holding for you become worth less and can even be worthless.
As Inflation rises everyone’s buying power decreases. What you could have lived off for a month 10 years ago might be triple, but your money that you saved or invested might not have which leaves Americans in a compromising situation. For health care and just surviving through old age. Unless your actively doing something to take care of yourself in the future your currently in trouble. Social security is paying less and things cost more. Retirees will not be able to survive and there government that promised to take care of them is overspending and in debt. Can’t take care of themselves and is why they are always raising taxes and inflation. And they won’t tell people the truth cause if they knew how what they react to the people taking there money there whole life that they worked for and lying to them.
READ NEWSLETTER ARTICLE HERE: https://prisonprofessorstalent.com/journal-entries/march-7-2024-lesson-7-digital-economy-decentralized-finance/
