📊 Class 50
WHY DOES BITCOIN RISE WHEN MORE MONEY IS PRINTED?
Therein lies the problem!
To understand Bitcoin, one must first understand money. (that class is still pending)
Central banks, like the Federal Reserve, can print money when the economy needs it. Did you know that already?
This is done to:
👉 stimulate the economy
👉 provide liquidity
👉 increase consumption
👉 help in economic crises
The problem is that when too much money is printed, money loses value over time.
This is called inflation.
That is to say, it's not that things are more expensive…
it's that money is worth less.
That’s why many people seek assets that cannot be printed.
This is where Bitcoin comes in.
Bitcoin has something very important:
👉 its supply is limited
👉 only 21 million will exist
👉 no one can print more
That’s why, when there is a lot of money issuance in the world, many people start looking at Bitcoin as a way to protect their money from inflation.
That’s why Bitcoin is not only driven by trading or news…
It is also influenced by how the global financial system works.
Understanding this completely changes the way one views Bitcoin.
