Journal Entry: Stamatina Bourret-03/10/2024-Digital Economy Course-Lesson 7

Journal Entry

Lesson 7
Decentralized Finance


1. The reasons I would attribute to the volatile nature of Bitcoin is that since all transactions are verified and are able to be seen by everyone there is no way to manipulate how many you can have. This transparency makes it more valuable.

2. I do not see any advantages with fiat currency. I do see many disadvantages. Having the government manipulate the currency with no backing makes that currency only valuable when the government says it is. Having been in situations with the government multiple Americans as well as individuals from other countries do not have faith that the government is doing what they say they are, they could decide that the money is worth absolutely nothing at any point in time and being there is nothing to back that besides the government. Thus you will always have a thought that the government may take your money away at any point in time.

3. Inflation influences a person’s savings account because as inflation rises or falls the interest rate on the savings account can rise or fall. Thus allowing your savings account to gain more or less interest and turning so your long term savings is thus affected. The government can make money more or less valuable so if it becomes less valuable you money could at some point mean nothing to you.

Thank You