Hello to my friends who love life and always smile despite all kinds of negativity. In this article, I want to talk to you about the global economy and Bitcoin. Right now, the markets are very volative, the trend is having a hard time finding direction. Momentum is low… Investors are at a loss as to what to do… Manipulations are being made with the twitters of ignorant people…
In the current financial system, investors buy Gold and Silver to gain against inflation. Investors' confidence in the current financial system has begun to decline.
Why do I think like that…? If you're wondering, let's get started...
Let's talk about dollars...
Source by FED
Especially due to covid-19, it prints free dollars to support USA citizens. Their only desire is to ensure the continuation of the current system. All countries in the world do this.
Coin Money;
In order for a country to print money, it must find an equivalent for the money it can print. Every printed currency in the market has its equivalent. The value of money in a country is equivalent to the gold in that country's treasury. If a country tries to print money without making any provision for it, without paying attention to it, inflation will occur in that country.
A little history;
Unrequited Dollar
In the 1970s, the problem of foreign trade deficit began to occur in the USA. The American people began to consume more than they produced. They were doing mutual trade with the USA, Europe and Japan, and they were trying to make up for the difference with gold. As gold left the country, it grew in the open.
The president of the time, Nixon, made a decision that the dollar was not gold and turned the dollar into a debt stock. Printing money has become very easy for the USA. After this decision, the USA, which printed a large amount of dollars because there was no money for gold, started to pay all its foreign debts. The dollar, which was left unrequited in those years to balance the foreign trade deficit, still has no equivalent today.
Another example of this was experienced during the 2008 crisis. After the global crisis, the USA thought to pay its debts by printing more money. Because he does not need to show anything in return for the printing of his money. However, after this transaction, with the increase in the money in the market, the dollar became worthless and domestic investors in the USA decided to invest in foreign countries. This is the reason why some countries survived the 2008 crisis.
The dollar, which has no equivalent, is used as a common currency by the whole world. For countries, not using the dollar or even declaring that it will not use the dollar is considered a disaster for their economies. It is frightening that the currency that the entire world economy is connected to does not have any equivalent.
But with Bitcoin, the situation is different. The maximum amount you will get in Bitcoin is a certain 21,000,000 units. So the supply is fixed.
On the one hand, it's just a piece of paper with no money, on the other, a product with a stable supply, resistant to inflation… Which would you prefer?
Some people think that Bitcoin cannot be a means of payment and that the bitcoin blockchain is not fast. They may be right…
Here we need to understand this well. Bitcoin is a “store of value”, not a means of payment. You can use other cryptocurrencies as a means of payment. Sample; Ethereum (ETH), Binance Coin (BNB), …
Galaxy Digital CEO Novogratz has this to say about Bitcoin;
“What makes storehouses of value unique is that they are essentially social constructions. (A store of value) is valuable because we (as a society) value it. Throughout human history, there is no other brand that has been more successful (than Bitcoin) that has been created by a certain community in 12 years. It's like they dropped a baby in the river, a community raised that baby, and now it's worth $1 trillion.”
My final words, blockchain technology and its product cryptocurrencies are our future. Bitcoin that started it is digital gold. You should consider Bitcoin as a store of value. Other cryptocurrencies will be used as means of payment. Other cryptocurrencies are for me a means of multiplying bitcoins.
As I always say, listen to everyone, decide for yourself...
Buy when everyone is selling, sell when everyone is buying...
I'm looking forward to your comments. Thanks to your comments, we can shape my next articles together. Let's stay in touch... Take care of yourself so that you and the people around you will be happy...
Photo by Karolina Grabowska from Pexels