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Bitcoin has been the best currency investment for over 1,200 years

June 5, 2020

Bitcoin’s (BTC) appreciation over the past 11 years differentiates it from virtually all fiat currencies in the world.

Central banks around the world continue to produce money and deliberately devalue the existing currency through inflation. They also had a lot more time than Bitcoin’s 11 years to accumulate effects. How do the main fiat currencies compare to Bitcoin?

Bitcoin: The bar by which others are measured

The first bitcoins were mined on January 3, 2009.

Bitcoin has been the best currency investment for over 1,200 yearsBitcoin has been the best currency investment for over 1,200 years

The first generally accepted commercial transaction took place on May 22, 2010. Laszlo Hanyecz bought two pizzas for 10,000 BTC in an event that has since been immortalized as Bitcoin’s Pizza Day. For pizza worth around $ 30, this currently corresponds to a BTC value of around $ 0.003.

However, The exchange rates were previously calculated based on the amount of energy required to extract each bitcoin. On October 5, 2009, this method suggested an exchange rate of $ 1 = 1.309.03 BTC or $ 0.000764 for a BTC.

However, it is unclear whether anyone bought Bitcoin at this theoretical price. For the sake of simplicity, we’re going to give Bitcoin a starting price of $ 0.003 almost exactly 10 years ago. In those ten years, BTC’s price has increased more than 320 million percent.

Good luck with fiat currencies. You will need it

The U.S. dollar has been the official currency of the United States since the Coin Act of 1792. How has its value developed over the next 228 years?

According to the consumer price index $ 1,792 would buy the equivalent of $ 26.71 today. In other words, it has lost more than 96% of its value in 228 years.

This number may come as a surprise, as there are often statistics that the dollar has lost a large part of its value since 1900. However, both facts are correct. The dollar’s value rose and fell in the first 150 years, and most of its value has been lost since it was decoupled from the gold standard in 1971.

The brave European challenger

The euro became legal tender on January 1, 1999, when it replaced the national currencies of the participating countries and was therefore only 10 years older than Bitcoin. Surely such a modern invention should compare better?

Unfortunately not, because the euro suffers from the same design problems as the dollar. Inflation has resulted in 1 euro being worth 0.70 euros in 1999 today, meaning that it has lost 30 percent of its value in just 21 years.

Does it weigh like a pound?

The oldest global currency still in use is the 1,200-year-old British pound.

Of course, today’s decimal pound pound is far from the original pound that existed before the formation of Britain and even England (with the union of the Winkel, Saxons, and Danes in 927). This makes a direct comparison of the then and today’s value somewhat controversial.

However, the original “pound” from the 8th century consisted of 240 silver coins, including a fine silver mercian pound, hence the name. [NÓTESE BIEN. Más tarde, esto se convirtió en una libra torre de plata esterlina, dándonos la libra esterlina.]

One pound of Mercian was equivalent to 350 g, which would have been worth GBP 156.45 (USD 200) at the current silver price. So if we look at the original value of precious metals instead of the purchasing power of the currency, the kingdom’s currency could have appreciated by 15,545% in 1,200 years.

Now if we use this logic …

When the Coins Act was passed in 1792, the dollar had a similar definition: 371.25 grains (or 24 grams) of silver. It’s worth $ 13.58 today, so you could argue that the original dollar in silver terms has risen by 1.258% over the past 228 years.

Even more impressive is that anyone who has owned a silver dollar since 1792 now has an artifact worth around a million dollars. So a real $ 1,792 has appreciated 100 million percent.

Of course, even if we measure our relative coin value this way, it has nothing to do with Bitcoin’s performance in the past 10 years.

It will also be much more difficult to spend your $ 1,792.