Nostr Web Client

If value is split into more coins/ notes that is inflation .. isn't it ?

For example , a nation has some underlying value - gold , land , wmds , army etc .. for the same value if it adds a trillion more notes/ coins ( currency ) .. we call it inflation ..

You can do the same for Bitcoin , when it becomes the unit if account ..

Today .. we presume dollar is inflationary because value in dollar .. when (and if ) BTC becomes unit of account , the count can be easily inflated by those who hold big chunks of BTC .. example microstrategy or ETFs .. or for that matter US gov ..

In other words , you put less copper in the same coin 🪙 :-)

David Härer 1y ago

I think of it like when I have 1000$ and the smallest denomination is changed to 0.0001$ (presumably because goods are priced in amounts below 0.01$), I still have 1000$, but over time it buys me more.

With inflation, some other entities in the market get new money, so my 1000$ buy me less. A symptom are discussions about dropping the 0.05$ coins and below, because nothing is priced in it anyways.

Reply to this note

Discussion