In the US and Canada, inflation remains high, over 30 years. In Canada, the annual CPI growth was 6.7% in March. About the same as in the United States since November. The rise in inflation in many countries is prompting more and more people to look for effective ways to avoid its effects.
Bitcoin is not hedge against inflation
Yvan Baker, a liberal MP, asked a Bank of Canada official if cryptocurrencies such as Bitcoin could be an effective way for ordinary people to avoid inflation. BoC official Carolyn Rogers does not support the thesis that cryptocurrencies can be a real hedge against inflation. Carolyn Rogers justifies her answer by referring to the fact that digital assets “fail the test” of a stable source of payment and value. “We don’t see cryptocurrencies as a way for Canadians to relinquish inflation or as a stable source of value,” he says. Due to the limited supply, Bitcoin is called by people from the industry “digital gold”. This is why it is immune to the depreciation of money caused by its printing, which is considered to be one of the main causes of inflation today. However, despite everything, a large percentage of people hesitate to think about it like this. Christine Lagarde, president of the European Central Bank, argues that Bitcoin is not a real currency, but a “highly speculative asset”. Meanwhile, Jerome Powell, president of the Federal Reserve Bank, says Bitcoin is not an appropriate store of value or a medium of exchange.
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The governor, regardless of the negative attitude towards cryptocurrencies as an asset, saw some “important innovations” in this area and would like to use these benefits in a “regulated environment”. BOC has already entered the “development phase” of a possible CBDC, although the final decision on its adoption will depend on the parliament. But Tiff Macklem, another governor, denies the idea of replacing the Canadian dollar with a virtual currency. “We certainly expect the Canadian dollar to remain at the center of the Canadian financial system,” he said.
Opinions about cryptocurrencies varied in the Canadian congress. However, Pierre Poilievre, a conservative MP, expressed his support for Bitcoin as an alternative to the Canadian currency. A month ago, in an ad for a public campaign, he called on Canada to take control of money from bankers and politicians to become the “blockchain capital of the world.” The leader of the libertarian party, Maxime Bernier, also expressed his support for Bitcoin, calling it a “new and innovative” way to resist central banking.
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