Let’s talk about eggs. Eggs are a staple food for many people around the world, and little has changed since the 1980s. These are all changes and improvements in the egg industry, but the underlying product is basically the same.
However, egg prices have remained fairly stable, as the Centrois Fed data below shows. In 1980, the average price of an egg was less than $1, but by 2022, the price of the same product has tripled to about $3.
Due to long-term inflation, the purchasing power of the dollar in 1980 was about $3.60 today. This increase equates to his $2.60 increase over 42 years.During this period, the average inflation rate of the dollar was 3.09% per annum, generate a cumulative price increase of 259.56%.
Holding an asset like BTC is important for both long-term horizons and low time preferences. If we change the account unit from USD to BTC, we get a completely different chart. Measured in BTC, egg prices appear to have fallen significantly since 2015.
Using today’s bitcoin price, an egg cost $1 million in 2009, but about 12,000 sats (about $3) in 2022.
While this is more of a theoretical argument than a practical one, it shows that Bitcoin’s purchasing power has risen dramatically in recent years when compared to everyday necessities like eggs.
The purchasing power of the dollar (and most fiat currencies) declines over time. Bitcoin is unique in that its purchasing power continues to rise with each halving. Past performance is no indication of future success, but the way Bitcoin works doesn’t change.The supply of Bitcoin is fixed. There are no central bank operated money printers.
The amount of Bitcoin that was last active more than five years ago has reached a record high of 25%. This means that a quarter of all Bitcoins have not moved in five years. Therefore, those who bought Bitcoin in 2017 can now buy more eggs with BTC than ever before.
Eggy news for Bitcoin Hodlers.
For those interested, companies like Crypto.com, Ziglu, BitPay and Binance can be used to load debit cards with Bitcoin. Once this is done, you can use Bitcoin to buy eggs. 1 Bitcoin can buy 122,979 eggs at today’s prices in a UK grocery store. Or just 0.000008 BTC for 1 egg.