For most of the last century, the world has operated on a system of fiat currencies—money that is not backed by any physical asset, like gold, but rather by government decree.
While this system has allowed for flexibility in monetary policy, it has also opened the door to unprecedented levels of inflation and devaluation.
The more money a government prints, the less each unit of currency is worth.
Over the past two decades, central banks have engaged in large-scale money printing, most notably during the 2008 financial crisis and the COVID-19 pandemic.
This monetary expansion was supposed to stabilize economies in the short term, but it came at the cost of long-term value destruction.
In the U.S., the Federal Reserve’s balance sheet exploded from $900 billion in 2008 to over $8 trillion by 2021.
The result? An erosion of purchasing power that disproportionately affects savers and investors.
The problem with fiat currency is that it’s entirely controlled by central banks and governments, who have every incentive to devalue the currency to fund deficits, bail out failing institutions, or placate voters with handouts.
This constant manipulation punishes those who hold cash, as inflation slowly eats away at their savings.
Bitcoin, on the other hand, operates outside of the traditional monetary system. It is immune to government intervention and central bank manipulation.
Its supply is fixed at 21 million coins, and no central authority can change that. In a world where fiat currencies are losing value at an alarming rate, Bitcoin stands as a hedge against monetary debasement.
Fiat currencies are subject to manipulation and devaluation by governments and central banks. Bitcoin’s fixed supply and decentralized nature offer protection from inflation and monetary dilution, making it an attractive alternative for wealth preservation.
