Inflation is a joke. It is a show country to put and force everyone to pay for it.
And the government official has missed the remark.
A so-called sophisticated understanding of economics just misses the most important task they only need to perform 🤔?
Or maybe the government did it on purpose?
Why is high inflation beneficial 🤯?
We are taught that low inflation is better because the economy can expand faster through low inflation, and everything is cheaper.
Here are two hypotheses:
📌 inflation is irrelevant
📌 inflation is manipulating
Inflation is irrelevant to the economy rather than fighting for new types of currencies – cryptocurrencies.
Higher the inflation, the higher the value of fiat currency. If cryptocurrencies are an investment like stocks, they will drop into worthless. But it is not the case as Bitcoin is very stable. The current policy sees cryptocurrencies are commodities that make crypto more valuable than previously assumed.
To manipulate inflation within the nation, asset value will drop dramatically, but the fiat currency will dominate. Also, commodities will dominate, which trumps cash.
What the government was unexpected is that it helped lay out the future cryptocurrency domination and the foundation of the valuation.
Why does the government want to do that?
They had no choices. People lost confidence in the cash. Inflation is just a disguise to cover the loss of faith. Otherwise, the government can repair inflation relatively fast.
To repair the faith, it will take a longer time than they expected.
The result is everyone will have to suffer for a while 😅.
Does everyone start questioning why we have to pay for it?
Even Elon Musk is questioning it:
And he ran away from his Twitter deal because his money got cut by more than he expected.
The actual economic competition right now is old vs. new.
The old industry has been FOMO about technology companies and their advancement, and they want it too.
But, do the younger generation wants the good old day? Or perhaps older generations just try to re-create their imaginary society at the cost of the younger generations?
Bitcoin is not dead yet
Bitcoin is not dead. In fact, the value of Bitcoin has increased in the past few months, and this is because of a lot of positive attention that Bitcoin has received. Many people are still interested in using virtual currencies to store their money. However, for these people who have been long-time Bitcoin users, the demand for Bitcoin has grown as the price has increased. If this assumption is valid, most people who plan to buy bitcoin will need to have a good reason for doing so. What if this assumption is no valid?
What is a cryptocurrency?
A cryptocurrency is a digital currency that has no primary functionalities other than being able to be stored online and exchanged for various other cryptocurrencies. Some of the most popular cryptocurrencies currently are Bitcoin, Ethereum, and many others.
Why to buy Bitcoin
There are numerous reasons to buy Bitcoin, but the most important one is to diversify one’s investments. If you are mainly investing in Bitcoin and other cryptocurrencies, then you will definitely want to buy more of them in the future. However, if you are trying to diversify your investment and purchase other cryptocurrencies, then you should start with the oldest and most successful ones. Additionally, individuals who hold positions in various financial products like stocks or bonds may also want to purchase Bitcoin. This is not a recommended move, however, as volatility in the market makes it difficult to know what will happen next. But when the economy will have a long recovery time, buying Bitcoin is not a wise move since it may take even longer for Bitcoin to recover its price.
Why not to buy Bitcoin
There are a number of reasons not to buy Bitcoin when the economy is bad. One of the top reasons is because you do not know where to start. There are many online retailers that sell everything from computer hardware to electronics, but you will probably never go that route since FTX is a prime example to let loss of trust on the exchange service. Another reason not to buy Bitcoin when the economy is bad is security. The amount of money and time to spend of securing Bitcoin is considerable. It is also likely that many criminals will target people who have money stored in a self-custody wallet.
The demand for Bitcoin has grown over time as more people adopt the digital currency as a store of security and money if that is the case. As more people adopt the currency, the value of Bitcoin has increased. This growth is likely due to many reasons, including the fact that many people now want to use the currency as a store of security and money. Although cryptocurrency has seen rapid growth over the past few years, it does not guarantee it will grow in the future. The demand for cryptocurrency will likely decrease in the future if people realize that it does not have any primary functionalities other than being a cryptocurrency itself.
Of course, this is no financial advice.
Invest NFT is a very bad idea
You’re probably thinking, “but why would I ever want to deal with non fungible tokens or NFTs?” Well, that’s because there are a couple of very practical reasons why you shouldn’t. Firstly, non fungible tokens are not very good for your long-term investment. Let’s take an example. You have just purchased a 5 million worth of NFTs from Coinbase. Your long-term investment is protected for the next three years — barring some catastrophic event? But even if you manage to maintain your long-term investment for the next three years, imagine what will happen once you hit five of those years! Without a doubt, these problems increase exponentially when you have a bear market — how much can you keep NFT value? It’s quite likely that you will be broke.
What is a non fungible token?
A non fungible token is an crypto that is not from a recognized blockchain like Ethereum. After being offered for purchase, these tokens can be easily bought and sold on any exchanges you would think. However, they are extremely liquidated and hard to sell.
Proper use of tokens
When you want to buy or sell a single NFT, you can always purchase it with other cryptos. However, NFT is just a symbol of owning something that is … useless…
Fees and charges on transactions
A transaction fee is charged when you make a payment with a cryptocurrency exchange. You can choose to pay this fee in fiat cash or a payment service like Coinbase’s Wallet.com. The transaction fee is a percentage of the amount of money you have just transferred. You can pay this fee in exchange for having access to the market for that particular crypto exchange. Some exchanges will charge you a trading fee in addition to the transaction fee. This is mainly to help cover their fees.
What happens if we try to sell NFTs?
Creators will benefit from each transaction. That is all. Unless there are exclusive perks that follow of owning NFTs, there are no much value that you want to possess them.
NFTs are not as what we expected them to be.
When crypto bank is a shadow bank
If your business goes bust, what will you do? You’ll probably need a fresh start. Fortunately, that can be a lot easier than you think. But that is not easy for a shadow bank, particularly the crypto shadow bank. Let’s explore what to do when your shadow bank goes bankrupt.
What’s the profit in being insolvent?
When your business is profitable and has plenty of cash in the bank, you can either pay your debts or use the profits from your sales to repay your creditors. If you’re able to meet your debts, you can then use the profits from your sales to pay your creditors. In some cases, you can even try to access your assets to pay your creditors. However, crypto shadow bank has illiquidity assets that unlikely can exchange to cash and pay off the debt. They are likely to go bankrupt with cash on hand and forced to sell their illiquid assets later to pay off debts.
Residual income or loss?
In general, if you’re able to show that you have a profit in being insolvent, it’s a good sign that the other parties in your business have their ear. If they haven’t, they could become targets. If you can show that you have a surplus, that is money left over from one period of activity when you were profitable and unable to pay your bills, you could be able to get your debts forgiven or pay them in full. For example, if your sales this past month were $1,000 and the total amount saved was $400, your surplus could be $100. If you can’t show this, you may have to start again from scratch. Unlike crypto shadow banks, they made huge profits when the market rose but lost quickly when the market went down. When the market goes down, they are less likely to get more funds since investors lost their appetite on the crypto.
What to do if you’re insolvent and no one will pay your bills
If you can’t show that you have a profit in being insolvent, you usually have three choices. You could either pay your bills or try to get a loan to avoid bankruptcy. You may also be able to get a special interest group on your local real estate board to readize you and make any required property inventory. You can also call a mortgage broker and arrange to buy a home.
But if you are running a crypto shadow bank, you cannot sell crypto because the market goes down faster to preserve your asset price. You cannot get another loan because likely you have highly leveraged your previous loans with high risky assets.
Get a loan to avoid bankruptcy
If you can’t pay your bills, you might be able to get a loan to make repayments on your credit cards or other debts. However, this shouldn’t be your only source of cash. For example, if you have a net worth of $5 million and your debt is $1 million, you could borrow $500,000 and have it repayments in as little as a month. Again, this is a very low-risk way to make payments.
But in crypto shadow bank, that is no an option for you.
Make payments on time
If you’re able to show that you have a surplus, you can try to pay your debts in a timely fashion. For example, if your debt is $500 and you owe $100, you could pay the full amount in a few weeks, or you could wait a month and then pay the rest. This is a low-risk way to make payments.
In the crypto shadow bank business, you cannot make payments on time and will likely go bankrupt soon.
Try private loans
You can go ask private loans with high-interest payments for the short term to offset your losses. This is not an option for crypto shadow bank again, they have already possessed high risky private loans.
Small businesses can weather uncertainty but no crypto shadow banks, which is why many crypto lending services keep collapsing.
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