Deflation Is Coming. Will It KILL Bitcoin? (Bull Run Over?)

Posted 5 mins ago | by Catoshi Nakamoto

Inflation has been on everyones mind for the past several years and predictions of run away inflation happen every day. We’ve already seen inflation this year hit 5.4% based on the Consumer Price Index, but most experts agree that real inflation is much higher. Bitcoin has been making a name for itself as a store of value, a hedge against inflation. But the narrative appears to be changing, the elites know that the inflation bubble is going to jeopardize the power of the dollar as a world reserve currency and are talking about making policy changes to bring about DEFLATION. So if inflation was good for Bitcoin, is Deflation bad for bitcoin?

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Let’s get it.

Welcome to Bitboy Crypto, home of the BitSquad, the largest and greatest crypto community in all the interwebs. My name is Ben. Every day on this channel I show you how to make money in Crypto. If you like money and crypto, be sure to hit that subscribe button. In this video we look at the affect Deflation could have on Bitcoin.

Deflation Is Coming How Will Bitcoin Be Affected?

Inflation has made the dollar less valuable, in fact the dollar has lost over 90% of it’s purchasing power since it became a fiat currency in 1933 when FDR took the dollar off of the gold standard. Combine that with the insane wages stagnation that has been happening over the last 40 years and you can start to see how the middle class of the US has been squeezed out of most of the wealth creation. But the value of the dollar hasn’t even seen it’s biggest value drop yet, that’s coming very soon. The money printing that happened in 2020 was staggering. The Federal reserve printed more money than has ever existed in the United States in the span of less than 10 years. All of this started happening during the early years of Bitcoin and in the past few years has shaped Bitcoins narrative from being a digital cash to becoming a store of value against the rapidly inflating dollar. Bitcoin is, as Michael Saylor likes to point out, the apex property of the human race. Check out my interview with Mr Laser Eyes himself by clicking here. I think Bitcoins value IS in being a store of value and not a currency. It will make all of crypto better as digital gold instead of being digital dollars. But if there is a change to the nature of the dollar, if deflation were to set in, would that spell the end of Bitcoin and the rest of the cryptoverse? If the dollar were to GAIN in value…would that make Bitcoin LESS valuable? Let’s dig into it. But you know what is valuable no matter what? Being in the Bitsquad. Smash that like and subscribe button to squad up and stay in the know with the largest crypto community on the interwebs.

So what is Deflation?

Deflation in an economy is when consumer prices decrease and purchasing power increases. This can be caused by several factors like an increase in productivity, a decrease in demand or a decrease in the volume of credit in an economy. While that sounds like a good thing, this usually leads to severe economic downturns. But why? Most of the global economy runs like a market economy, and market economies have stock markets. The stock market in the US is highly influential in the overall health of the economy since it is tied to so many things that hold value, not just stocks but mutual funds, IRAs so on. So if a currency is deflating, or increasing in value, means you’ll gain more value by saving it instead of spending it. This discourages making investments in the stock market. And so stock markets will go into a downturn and pull the rest of the economy down with it. This isn’t always the case, but it’s a trend. An asset like Gold or Bitcoin are deflationary in that their purchasing power goes up over time, mostly due to their intrinsic value and limited supply. This is rarity. Gold and Bitcoin become more rare, whereas cheap things like pine needles, chicken nuggets or USB cables are very common. If you print a trillion dollars in a few months…Those dollars you had before then aren’t worth that much any more.
But wait. If the value of the dollar starts going up, will things start to get more expensive. Yes and no. Consumer prices will go down, but things like credit will become very expensive.

So is that it Ben? Is crypto over? Should we go all in on the dollar? Not by a long shot. Deflation is going to be kicking off just as the bull market is finishing up later this year. When that happens, and you’ve been taking profits along the way like a good degen…then you’re going to be set up for bear market accumulation on steroids. All of crypto will be correcting about 80% off of their tops in the bull market and will settle down into their bear market zones around this time next year. Bitcoin would be hovering around 18 or 14 thousand and Ethereum could drop as low as 1200 dollars. But that’s with current dollar values. The prices of all assets, not just crypto will be depressed as the value of the dollar goes up. So Bitcoin could go even lower. But don’t take a hammer to your ledger just yet; remember your bull market gains are going to be increasing over time, allowing you to accumulate more crypto during the bear market than has ever been possible from a dollar value perspective. Think about it. The dollar has been losing value for as long as most of us have been alive, but now the dollar will do something it hasn’t done in 40 years, gain in value.

Your dollars from 2018 will have more purchasing power now. During the crypto bear market things will look grim…but it won’t be anything compared to the stock market. That’s going to be a bloodbath. All of the cheap debt will be gone and the whole house of cards will be falling apart. But your portfolio will be solid. And there will be an ace in your sleeve to boot. Stablecoin staking. Your stablecoin of choice that is sitting in Celsius making 4, 6 or 12% a year in interest will be turbo charged as the value of the dollar increases. Head on over to bitboycrypto.com/deals to get set up with Celsius get your gains set up. The bear market will time out with this deflationary period perfectly since most crypto bear markets last 2 to 3 years, the same as most deflation cycles. So make sure to be accumulating Bitcoin, Ethereum, Cardano and other top 20 coins during this time and down the road when the bulls come back after the next Bitcoin halving in 2024 your going to be set up for life changing gains. Bitcoin will be breaking 250,000, Ethereum could hit 40k and Cardano will be pushing $30 or more.

But that’s all I got. Be Blessed. Bitboy out.

Source: https://thebittimes.com/deflation-is-coming-will-it-kill-bitcoin-bull-run-over-tbt2688.html?utm_source=blogger_source&utm_medium=blogger_medium&utm_campaign=blogger_cam

Category: Cryptocurrency News

Post by: TheBitTimes.com