Bitcoin, the ‘digital gold’ and the biggest deflationary asset, has slipped below $60,000 after trading at $69,000 earlier this month. However, reports from the UK, Canada, and Eurozone might turn BTC bullish again.
According to reports, inflation rates break historical records in the United Kingdom (UK), Eurozone, and Canada. While crypto enthusiasts mainly see Bitcoin as the world’s biggest deflationary asset, Ethereum is also entering the race as billions of dollars of ETH were burned as the EIP 1559 went live on the network.
Inflation breaking records
As per reports, inflation is now at a decade high in the UK. From 3.1% in September, the Office for National Statistics reported inflation had accelerated to 4.2% from 3.1% in October. The recorded rise in inflation from November 2011 might cause a dent in many pockets this Christmas.
The governor of the Bank of England claims that the rates might reach as high as 5% in the coming months. Therefore, the central bank is under pressure to raise interest to curb this speedy growth in rates.
A similar situation exists in Canada, where inflation rates rose to 4.7%, with the largest year-over-year gain in 18 years. This was the fastest inflation rose in the nation since February 2003. According to Reuters, the analysts expected an average rate of 4.3%.
The governor of the Bank of Canada, Tiff Macklem, believes that this spike in rates is just a transition phase and soon will be over.
“What this all means, in all our countries, is that inflation – measures of inflation – are probably going to take a little longer to come back down.”said Macklem
In Eurozone, the conditions are not so different. As per government data, the rates rose to 4.1% in Eurozone, followed by 4.4% in European Union. These levels of inflation were seen for the first time since 2008.
What about Bitcoin?
The after-effects of these rates are visible as Bitcoin proves to be a haven against inflation. Recently, Jordan Peterson, the clinical psychologist, and a famous YouTube personality invested in Bitcoin to hedge against inflation.
Due to these rising rates, gold is also nearing its 5-month high. However, it seems that due to its popular deflationary nature, crypto enthusiasts will continue to hedge their hard-earned cash into BTC.