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Bitcoin was initially created as a way to transact peer to peer and send value without the need for a centralised counterparty. Over time, however, it has become the go-to for many as a hedge against inflation, and more importantly, as an escape from failing fiat systems. There is a fixed supply, a fixed issuance mechanism through mining, and a fixed halving schedule every 210,000 blocks. You cannot simply create more Bitcoin. The same cannot be said for fiat currencies, which are controlled by central banks around the world. When issues arise, the common response is to print more money as a short-term solution to deeper structural problems.
Since Bitcoin’s inception, we have seen several fiat currencies collapse through hyperinflation. In recent years, notable examples include the Argentine Peso, the Lebanese Pound, and now the Iranian Rial. The chart below shows a clear trend. Bitcoin priced against hyperinflated fiat is up and to the right. One day your local currency can buy you goods and services. The next, it can be worth a fraction of that, and there is nothing you can do about it.
