Can a Deflationary Currency Work?
Being Termed as Digital Gold Is Accurate as Its Store of Value Will Increase as Deflation Drives an Increase in Valuation and Scarcity; a Deflationary Currency...
Being termed as digital gold is accurate as its store of value will increase as deflation drives an increase in valuation and scarcity; a deflationary currency cannot be used as a medium of exchange in the long term.
Can a currency be deflationary?
There are two broad groups of currencies out there: inflationary and deflationary. Inflationary currencies have no limit to how many units are in circulation, while deflationary currencies have a max supply.
How do deflationary currencies work?
In this model, money is deliberately printed into the system every year, and Central banks have the authority to devalue money or increase the money supply. The principle of this model is that when your money is devalued, you're likely to spend it faster instead of saving for later.
Alexander Ross has covered the video game industry for a decade, writing deep dives on game design, esports tournaments, VR developments, and gaming culture.
