While the BRICS countries – Brazil, Russia, India, China, and South Africa – are mulling the introduction of an alternative currency to the United States dollar as global reserve money, and many people are voicing their opinion that the USD would no longer be the world standard, Bitcoin (BTC) has been touted as a substitute, and its purchasing power could be one of the reasons.
As it happens, the purchasing power of the USD, which determines the amount of products and services you can buy with it, has been steadily weakening over the years, whereas that of the flagship decentralized finance (DeFi) asset has been sharply rising since 2010, according to the macro comparison chart shared by the finance analyst known as Seth on April 4.
Dollar versus Bitcoin
Specifically, the chart shows the Consumer Price Index (CPI) for all urban consumers in terms of purchasing power of the consumer dollar in the US city average, which has been declining since the 1960s, dropping from 300 to the current 33.2 points (88.93%).
On the other hand, the purchasing power of Bitcoin in the same context has shown as quickly climbing, soaring from 33 in 2010 to the current 255 points, or a whopping 672.73% increase over the observable period of only 13 years.
At the same time, the list of people warning of the dollar’s declining dominance as the world’s reserve currency is growing, recently including former U.S. President Donald Trump, who has told his supporters and the media from his Florida home that the U.S. dollar was crashing and would “no longer be the world standard.”
Research from Kaiko noted on April 5:
“The Dollar took a hit yesterday after the number of job openings in the US. fell more than expected (JOLTS), boosting recession fears. Although BTC remains negatively correlated with the US Dollar, the correlation is now almost negligible, falling from -60% to -23% YTD.”
Bitcoin price analysis
Meanwhile, the maiden cryptocurrency was at press time changing hands at the price of $28,500, which represents a 0.93% gain in the last 24 hours, adding up to the positive price change of 4.43% over the previous seven days and 27.11% across the past month, as charts indicate.
Notably, Robert Kiyosaki, author of the best-selling personal finance book ‘Rich Dad Poor Dad,’ is also skeptical about the future of the USD, recommending his followers to buy Bitcoin, gold, and silver and referring to the US fiat currency as “toilet paper” and “fake money” that is pushing the “American empire to its end.”
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