Musk, in a discussion on Twitter about his forecast for the rate of inflation over the next few years, said that he would retain his holdings in Bitcoin, Ether and Dogecoin amid rising inflation. Responding to Musk’s tweet, Seller said consumer inflation in the dollar would hit an all-time high and asset inflation would double. He said that due to the scarcity of bitcoin, there will be an increase in investment in it. According to research firm Statista, the annual rate of inflation in the US was 3.2 percent in 2011, rising to 4.7 percent the previous year. This indicates that the purchasing power of the dollar has weakened in recent years.
Apart from Corona, the reasons for increasing inflation are the ongoing war between Russia and Ukraine. Seller last week described bitcoin as a limited resource like gold. He said that only 21 million bitcoins would always be available. About 90 percent of the total supply of bitcoin has been mined. However, many countries have also imposed restrictions on crypto mining due to the high consumption of electricity. These include countries like China and Iran. America’s Texas is said to be the hub of crypto mining and mining is being opposed in this state too due to the increasing consumption of electricity.
The effect of favoring bitcoin on the part of Musk and Seller is also visible on the crypto market. Prices of some cryptocurrencies, including bitcoin and ether, were bullish when this report was published. Musk has been tweeting in favor of cryptocurrencies in the past as well. His company Tesla recently informed about taking payment in cryptocurrency from customers for merchandise.
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