A growing number of citizens living in economically and politically troubled countries are turning to Bitcoin and other digital curries, FOX News reports. Citizens of countries such as Venezuela and India have lost faith in their local currencies and seek refuge in the digital currencies such as Bitcoin, DASH and others, as their local currencies gradually decrease in value.
Consumers looking for better value
According to the Beach Price Index released by Travelbird, it showcases how currency fluctuations, political change affect the value for money of each destination.
Total Price = $ Sunscreen + $ Water + $ Beer + $ Ice-cream +$ Lunch
Traditional currencies tend to fluctuate in value due to several factors that would then affect the exchange rates of the countries in question. Political and economic events also affect exchange rates of different countries which is why the prices of each beach would render a different total cost.
As holidaymakers and consumers seek better value for money, many have turned to cryptocurrencies to protect themselves from further effects of inflation and get better value for their money.
Bitcoin to beat inflation
Finance experts believe that Bitcoin actually has the ability to beat inflation. For one, economics professor, Panos Mourdoukoutas, explains why Bitcoin has beat other investments such as stocks, bonds and in some ways, gold included:
“Bitcoin has left stocks, bonds, and gold in the dust in 2016. The digital currency has more than tripled in value, while the S&P 500 and SPDR Gold Shares rose in upper single digits; and all three investments outperformed the iShares 20+ Year Treasury Bond, which declined in value.
Then there are the renewed concerns over the break-up of trade wars, and the return of the old fiscal easing and huge budget deficits that feed into inflation, which undermines faith in national currencies.”
There are several reasons as to why Bitcoin can beat inflation, but the main reason is that it has the power to appreciate faster than the traditional currencies, especially the dollar. Inflation is an action that happens when the amount of dollars in circulation of the Global Reserve Currency increases.
With Bitcoin, it is possible not to have traditional fiat in circulation and potentially survive inflation imminent with traditional currencies.
If more establishments adopt Bitcoin as a payment method, it is possible for consumers to enjoy more stable pricing without having to undergo inflation that comes with most traditional currencies.