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Disclaimer: I may be absolutely in the wrong here, as I may be missing some fundamental economics knowledge.

From my understanding, inflation is not really a property of the currency, but a property of market in which given currency is used. It's not the USD that loses value, it's the specific prices that increase, not that some products get cheaper. If some country suffered from hyper-inflation, they may start using USD instead of their original currency, and local products would end up with a different inflation in USD, than USD in US.

In Bitcoin and other crypto, I doubt there is huge market which has prices set in those cryptos - they are used as a courier money for markets in specific fiat currencies, like USD. I doubt people pay 0.001 BTC for a server, they pay $100 but in BTC.



It is a function of the total quantity of the currency at any given time, that currencies distribution across the economy, and the supply of the products/services it is being used for trade.

Then the banking system gets involved and it gets a bit complicated, but essentially any currency that is used for fractional reserve banking will experience a slow (or fast, depends on regulatory control) expansion in its total quantity over time.

Of course nobody would perform unregulated fractional reserve banking with cryptocurrencies now would they? Well actually, this is exactly what tether, luna etc are/were doing under the hood.




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