Binance, the largest exchange in the world, tells us how crypto-currencies can help us preserve the loss of purchasing power, caused by inflation, especially in Latin American countries.
There are countries in Latin America where inflation punishes very severely, as in the case of Argentina, where it is already close to 45% year-on-year. Another case is that of Venezuela, where the figure is exorbitant. Your currency is literally worthless.
Crypt coins, especially Bitcoin Era, can be an interesting alternative to preserve the value of our savings.
Binance: 5 reasons to save on your stablecoin BUSD
Kryptomonas as a cost-saving alternative
Crypto currencies have mainly been used for investments, i.e. people put a certain amount into an asset and expect to increase the profit after a certain period of time, but have you ever thought about crypto currencies as a method of saving against inflation?
Inflation is the economic process caused by the imbalance between production and demand. It causes a continuous rise in the prices of most products and services, and a loss of the value of money to be able to acquire or use them.
Leaving your savings at home under the mattress, under lock and key or in a safe is not the way to protect your savings, as the money will be losing value every day due to factors such as inflation.
Similarly, keeping the money in a savings account at a bank is not an option either, the capital saved over the years will have less and less purchasing power because in countries with inflation the fiat currency loses value every day.
When a currency loses value, people take refuge in stronger or more stable foreign currencies such as the US dollar or the euro. The traditional way to do this is to buy them in cash and store them in a safe place.
Buying and selling foreign currency in cash is not the best solution, since it generates some inconveniences both in security and in transaction costs due to the difference between the purchase and sale prices.
On the other hand, it should be noted that any fiat currency, however strong or stable it may be, is subject to a government or central entity, which resorts to capital injection to survive economic crises.