According to the Fed Bitcoin is volatile, but defends its role as a store of value
In the United States, the economic information page of the Federal Reserve of St. Louis (FRED), recently published a graph in which it calculated the value of a dozen eggs with bitcoin. When comparing the values of this staple food in dollars and bitcoin from January 2021 to today, the Fed tried to highlight the greater volatility of the cryptocurrency against the dollar.
However, bitcoin investors were quick to respond to the Fed’s argument, amplifying the study period. Meanwhile, the authority related the behavior of both currencies in a time spanning 16 months, the bitcoiners determined to extend the sample to the year 2019 and even 2015.
In this way, the broad purchasing power of Bitcoin against a dozen eggs was demonstrated, all thanks to the sustained increase in the price of bitcoin in those periods.
In the period from January 2021 to April 2022, the Fed shows that the price of a dozen eggs ranged from $1.47 to $2.52. This evidences an average month-on-month inflation of 3.6% and a total increase of 71% in the price of eggs in the highlighted period.
The second dot shows the price of a dozen eggs expressed in satoshis, one hundred millionth of a BTC. “The price fluctuates quite a bit, between 2,829 and 6,086, which is much more than the price of the US dollar,” the Fed emphasized.
In other words, the agency highlighted that buying eggs with BTC could turn out to be more expensive and less convenient for the population. And although it may be an accurate argument in periods of great volatility in the cryptocurrency market, the reality is that the long-term picture speaks volumes about how bitcoin has not lost its value in the face of inflation in the United States.
Extending the price range in bitcoin
Once the Fed’s thesis of obvious bitcoin volatility was established, the interactive chart itself gave bitcoiners the probability of changing the time period.
From an attempt to stigmatize bitcoin and highlight its volatility as a downside, by the Fed, the prompt response from bitcoiners completely reversed the message. If a period of time of several years is considered, the role of bitcoin as a store of value is more evident, whether as savings or for the simple acquisition of an egg carton. Posted by Cryptobtcbrowser.