Don’t be fooled.
399 sats \ 5 comments \ @bitties 22 May bitcoin_beginners
DON’T BE FOOLED
We are still a 2x away from all-time highs.
Technically, Bitcoin did hit a new all-time high in March, reaching ~$74,000.
However, if you change the way we look at Bitcoin, we haven’t even got close.
Instead of using the US dollar as a denominator to value Bitcoin, if we use the M3 money supply, a completely different picture emerges:
If you are unsure what the M3 money supply is, an easy way to think about it is all money in circulation.
Essentially, because so many dollars have been printed since the last Bitcoin ATH, dollars in 2024 now worth significantly less.
When you adjust for how much money has been printed, Bitcoin still hasn’t hit an all time high.
It hasn’t.
Not even close.
We’ve only just begun.
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50 sats \ 4 replies \ @Undisciplined 22 May
What does this measure tell us?
We did hit an all-time high in terms of the exchange rate between the two moneys. It doesn't make sense to adjust exchange rates for inflation.
The reason to adjust for inflation is to get a measure of purchasing power. Three years ago, one bitcoin bought almost twice as much as one bitcoin today. That's crazy!
Someday, we'll have enough things priced in Bitcoin that we can cut out the middle man of fiat adjustments.
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42 sats \ 1 reply \ @bitties OP 22 May
Wanted to say I appreciate your posts and comments. One of the few Stackers I follow.
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20 sats \ 0 replies \ @Undisciplined 22 May
Thanks. That means a lot.
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42 sats \ 1 reply \ @bitties OP 22 May
I look at it as a measure of adoption rate.
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20 sats \ 0 replies \ @Undisciplined 22 May
Interesting. I'll have to think about that.
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