One of the attractive features of cryptocurrencies like Bitcoin is that there is a limit to how many will ever be mined. Thus, inflation is less likely to eat away at the value of a cryptocurrency than a fiat currency like the dollar or euro. But what if the economy tanks? What are the effects of a major recession on cryptocurrencies?
As the war in Ukraine continues protectionism is rising throughout the world. Understanding protectionism and your investments will be one of the paths to success as the forces of Covid shutdowns in China, inflation in the USA, and the prospect of a prolonged war in Europe cloud the markets.
While Bitcoin is the best known cryptocurrency it is not necessarily the winner in the race to dominate the world of decentralized finance. Which crypto will dominate DeFi? The first key to this issue that borrowing money with cryptocurrencies can be risky.
The Fed will be raising interest rates and that has spooked the market. Then there is the war in Ukraine with disruptions of the commodity markets and the prospect of global recession starting in Russia and Europe. So, these factors should explain why the market is down in Biden’s midterm year. But none of this explains why midterm elections and weak stock markets have been the pattern since 1900!
For investors who would like to replicate the Bitcoin success story is there a comparable cryptocurrency profit potential today? Are there other cryptocurrencies that could replicate the Bitcoin success story? what are reasonable expectations for Bitcoin in the coming years
The dollar strengthened and many borrowers across the globe ended up paying back more money in their home currencies that their loans were originally worth. The same predicament could befall those today who consider borrowing money in cryptocurrencies.
How badly does inflation affect your investments? Inflation does not affect everyone the same. And inflation can have different effects depending on the mix of assets in your investment portfolio. Part of the puzzle has to do with which measure of inflation you use.