Topic: Bitcoin is the Best Option: Because of Dollar Rate Cost of Living is on the Peak - page 2. (Read 594 times)

It makes sense because there are countries who have sanctions imposed by USA and still they are doing good because they are producing stuff internally and not much dependent on imports, for which you need USD. As long as government is determined on self reliance, the USD monopoly cant affect the country economy.

US government is free to print as many USD as they like since it's backed by nothing. Unless the USD printing machine is working fine, US government can print USD currency notes there is absolutely no limit of it.

Bitcoin is in its very initial stages and right now its impact is on individuals. We need to wait and see whether it can have any impact on economy on large scale in the long run.

Apart from the fact that you contradicted yourself in two paragraphs, dollar on its own is not affecting the cost of stuff including fiat exchange rate in other countries. What affects them is the decisions of the governments of those countries.

For example when they keep printing their national currency, they devalue that fiat and consequently price of everything goes up against their fiat.

The only case where dollar comes in is when that other country is an importer of US inflation. In simple terms that is when US prints dollar out of thin air and purchases real goods and services from that country.

Now, granted bitcoin has created great opportunities for a small number of individuals in different countries to make some additional money and improve their own personal financial situation, but as a whole it is not affecting the economy at a large scale.

I don't know why some feel that Bitcoin is some form of other thing apart from just being an alternative to fiat currency,  and providing some form of freedom from third-party involvement and control,  so for that, you have to take note of the real ideology of Bitcoin and what it stands for, most time some countries economy suffer drastically due to their economic policy and at that those that have access to global assets like Bitcoin which value is higher than other countries currency will have some form of financial freedom.


That is the main reason why countries like El Salvador 🇸🇻  made it a priority to adopt and invest in Bitcoin due to its ability to give them an edge against inflation in the long term.

While there is hope and a high probability that Bitcoin will continue to rise to historical prices, I think it is a mistake to think Bitcoin is the savior particularly in the situation you described.  If cost of living is on the peak then the worst thing you can do is think it is better to have such a volatile Currency to replace yours.

If something bad happens again.  Such as a war or a global crisis.  Bitcoin will probably drop again significantly.  Bitcoin is not the solution to it all, particularly to poverty.  It proves to offer a good profit over long time but few are patient enough to actually profit off it.

This is akin to saying that money can buy many things but not the happiness that we are looking for. Money can then be used to buy things that can have positive impact in our lives and from there those things can help us be happy. And this is the same thing with Bitcoin. We are never advocating that Bitcoin is the big solution for any country's malady but in some respect it can help. When people are educated with Bitcoin they will come to realize the folly of the centralized banking to print more money without balancing the side-effects it would have into the future generations. When leaders have this kind of mindset, they will try to rein on things and not allow indiscriminate printing and spending of money.

I always throw away my money and leave a little for daily needs, I allocate large amounts to gold, shares, mutual funds and bitcoin, some in altcoins too. saving money only reduces your wealth, every year it is eaten up by inflation, especially like yesterday's corona, in 2023 our country's money will lose 10% in value. Just imagine if you had $100,000 now it's only worth $90,000, this is really crazy, so if the OP's suggestion is a bitcoin solution, I somewhat agree. Bitcoin is similar in nature - similar to gold, or you could say online gold, or all currencies replaced with gold, I really agree.

Yeah, that's how it was originally intended. But something went wrong. People began to use bitcoin as a means of investment, and not as a means of payment.

So, I’ll ask for details in the highlighted text.

How does the dollar devalue a bitcoin? People themselves devalue bitcoin with their sell orders. The more sales, the more supply, the lower the price. This is a classic.

The dollar is still the yardstick for assessing the value of things. All over the world. Even within your and any other country. Even when the price tag is written in your national currency. Because any other currency is a repainted dollar.

Again the same question - how? The cost of living can be affected by an improvement in the country's economy. You idealize bitcoin and see it as a solution to everyone's financial problems.

So this is not a dollar problem, but a problem of the banknote in your country, which is weak due to a weak economy and poor management of the financial sector. Don't look for the source of problems outside your country (in the dollar), for it is within the country.

As I said earlier Dollar does affect the fiat currency but it does affect bitcoin to be devalued so if things are purchased with bitcoin will the price of things would be as it is? And I didn't say bitcoin will reduce inflation, I only said please understand me, since dollar causes the high cost of living, because of the exchange rate with the fiat currencies so if bitcoin is used, it will not be like that.

And for those who said bitcoin has nothing to do with the National Economy and bitcoin has nothing to do with the cost of living. You would have been a burden to the government or moving around looking for jobs from one place to another if you were not a bitcoin holder. @SatoPrincess from your comment, you are not a economist so you don't understand the important of bitcoin to a nation economy. If bitcoin has no benefits to a Nation Economy, Nigeria wouldn't lift the ban. The unemployment rate in the country is very high, but bitcoin came to liberate many youths from the poverty line and you are saying that bitcoin has nothing to do the nation economy. Do you know the Macro Economic Deficiencies Bitcoin has solved for individual in the world. And bitcoin can reduce cost of living because dollar does not affect bitcoin and dollar is the caused of cost of food items. I have been in this ecosystem for one year now and I know how I am now.

Bitcoin is a very good option in cases like this, but not that it is just a good option because it is Bitcoin but it is a very good option because it is an asset that people can invest their money in and earn a return. This return can be a very good means to cover up for us during times of inflation when our country's currency will be getting useless in worth gradually. But this still depends on the country we are talking about. In my country, though Bitcoin will help, but it can't still measure up for the huge inflation that has happened and that is still happening. Bitcoin is trying, yet, the inflation is bitting so deeper than it.

And for you to know the gist, within a few years now, we are now talking about 5-10 times higher in price. This year alone (as new as it is), some goods and services have tripled in price, though some could still be doubled or almost doubled depending on what we are talking about. So, it is that bad. I just hope that things will be fine with time even as we use Bitcoin and another possible assets to try to hedge this nonesense inflation that is frustrating people daily.

The cost of living in any country around the world has little to do with Bitcoin. If you live in a small and underdeveloped country, which has a low value national currency, then switching to BTC might provide some benefits, but I don't think that the overall cost of living in your country will drop. I still don't see any mass adoption of Bitcoin among the small business and the majority of the people. Bitcoin will keep being "digital gold", which would rather be adopted by big institutional investors. The retail businesses will stay away from BTC, due to various factors.
The transaction fees and the Bitcoin price volatility are the biggest problems, that represent a huge obstacle towards mass BTC adoption.

Cost of living is a comparative value not something based on some other foreign currency or Bitcoin. It should be compared with salaries.

For example if the cost of living is $100, if you get paid $120 you are good and cost of living can be called "low" but if you are being paid $80 the cost of living is considered high.
If you replace your national fiat currency with Bitcoin and cost of living becomes 100 satoshi and you get paid 90 satoshi, the cost of living is still going to be high.

In other words, cost of living being high is not something can be solved by changing the national currency. It is a problem that can only be solved by fixing the economy on a bigger scale and normalizing the salaries.

Yeah inflation is getting very sticky. We got a bad cpi print when we assumed we would get a leaner number. What this means is that fed rates won’t happen till end of the year.

And as a result stocks and crypto took a small dip yesterday and later recovered. When rates stay higher longer then stocks will trade sideways or go down.

The issue is when fed cuts rates due to some economic crash then people will buy assets like crypto, real estate, stocks because the market will be flooded with new printed dollars.

Bullshit.

If you only get paid $80 per month, that means $1 is valuable for you, but Bitcoin transaction fee now cost for $1 per transaction, it means you're need to spend twice amount when purchase a small thing. Don't talk about lightning network or side chains, it's not yet well adopted right now, don't expect government or businesses to accept it in soon.

The main problem of poor people are the jobs, not the currency.
The main problem of developing countries are the human resources.

Well, to me it is not surprising that the OP has no clue about economics, something that can be seen in the of comments trying to explain to him the gross errors he makes in the OP.


Surely the OP starts from the simplistic idea that if the fiat system and printing by central banks produces inflation, moving to a system with Bitcoin as legal tender would reduce inflation, which has its logic and is partially true, but it is too simplistic because one could not move overnight from one to another system and does not take into account other possible causes of inflation such as energy prices.

Surely, your country's economy won't improve all of a sudden just because Bitcoin is implemented as a legal tender. But as far as cost of living is concerned, in an unlikely scenario that Bitcoin replaces fiat altogether, I think we will have a deflationary economy rather than an inflationary one. A currency that has a fixed supply, if not decreasing, versus a free-market demand that is ever growing, the prices of goods and services could only go down in terms of Sats.

The cost of living in your country is caused by different economic problems. Inflation, low demand for national currency, political instability, etc might be some of the factors affecting your country. Until some of these problems are fixed, Bitcoin might have no positive effect on the economy. People will still have to pay more for goods and services with Bitcoin if the country is going through inflation.

Your country might benefit from Bitcoin if they buy the currency and keep it for a long time. They could make a profit that can be used to tackle other economic problems. Bitcoin adoption could also attract some investors and create few jobs in your country. It could also help to reduce the cost of international financial transactions since it could bypass SWIFT and other international payment channels.

How can Bitcoin reduce cost of living in your country?

If you use Bitcoin as your payment method, on chain, for living expenses, you will have to pay usually expensive on-chain transaction fee. By using it as daily payment, you will pay more fee than with fiat currency through bank transfer or with cash.

Bitcoin is not here to solve problems from fiat currencies or to reduce cost of living in any country.

At first i won't say that adopting bitcoin is bad but we must know that bitcoin is not the cause of inflation in our country and even though bitcoin is accepted as legal tender what changes does it cause over our dying economy?
Nothing changes, we import and export through dollars and we aren't gonna use bitcoin for that, even as that while using bitcoin the quantity or units would always be measured with dollars; I mean if you importing a goods worth $30k the conversion rate will be, BTC/USDT and then USDT/NGN so we still bounce back same place we are. We can't do without Fiat and fiat is everyone's local spending and not bitcoin, bitcoin is just a vessel to scale up transaction.

Wouldn't the price just naturally adjust? I think the "lowered cost of living" part is due to how Bitcoin has its own economy (unlike the dollar) but in the end, wouldn't the price automatically adjust to the usual high prices? Heck it might even be higher just so that merchants can accommodate the variances that Bitcoin has, which in most cases can be pretty high.

To compare, it's not like your $80 would change when converted to Bitcoin, it's still worth $80 at that point. And as for looking at prices with Bitcoin, as I said, it would naturally adjust according to whatever dollar equivalent it has, say $10, then no matter the BTC price, it'd always equate to $10 at the end of the day. I also don't see it realistic to put the entirety of your money as Bitcoin due to the high volatility, regardless of however much profit you can possibly make off of it since at the end of the day, it's just a "possibility".

The fees of transaction for Bitcoin varies and that's the reason why many retailers will simply accept it whenever it's low but they always have an option to do LN. Although the payor will still shoulder the fees, many don't want to learn on how to use Bitcoin as a payment.

If you think that using Bitcoin as a legal tender can decrease the price of goods in your country. Maybe it won't still be if those products are imported and there's a huge cost coming from delivering it from point a to point b.

While a country's economic status is dependent to the leadership and how your country is being managed and helped. Having Bitcoin as a legal tender won't solve everything on an instant.