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January 25, 2022

What is inflation?

The decline of purchasing power for an underlying currency. For example, last year you could buy a loaf of bread for $5 and this year it costs $7. Due to the heavy stimulus & money printing by governments during the pandemic to support the economy, some analysts expect inflation to rise in the coming years.

Bitcoin is often called an inflation hedge due to its fixed supply of 21 million, and many institutional investors bought BTC in 2020 for this reason.

Recently a high amount of inflation has been hitting most of the world as asset prices increase, which has been part of the reason for the recent stock market sell off.

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