Cryptocurrencies are No-longer Immune to Inflation Rates- Experts’ Opinion

Cryptocurrency adoption has significantly grown in the modern-day world, with more people joining the digital currency usage brigade. These digital assets have revolutionized the financial system by turning it digital and influencing aspects such as access, efficiency, and financial depth. Over the past few years, cryptos have experienced exponential growth. The market space of cryptos has grown to approximately $ 2 billion in 2022 as compared to the $828 billion valuations they held in 2018. Due to some developments and traits associated with cryptos, digital currencies have become prone to inflation. The increase in global inflation saw the cryptos’ market value swing between $3 trillion and $1.5 trillion in the span of a few months. The Relationship Between Crypto and Inflation Initially, cryptos were meant to be immune to inflation to protect their users’ buying power. However, the relationship between cryptos and inflation has shifted significantly in recent times. Much like any other legal tender, cryptocurrencies have an evolving relationship with the global economy. As a result, changes in the situation of the worldwide economy result in changes in the connection made. Inflation Inflation is the process through which a given currency, be it a cryptocurrency or traditional tender like bitcoin, decreases in value over time. This process results in the prices of goods going up in most cases. According to experts, while se...