One of Bitcoin’s inherent virtues is being inflation-resistant. This unique feature might be essential to help countries interested in adopting a passive monetary policy.
Bitcoin Controls the Inflation Rate
Only 21 million bitcoins will ever be mined. Therefore, Bitcoin is illiquid. However, Satoshi Nakamoto, purportedly the creator of Bitcoin, intentionally established this lack of liquidity to make the cryptocurrency inflation-resistant and to incentivize Bitcoin miners.
According to Professor Max Raskin, Bitcoin’s pre-commitment to an inflation rate that halves every four years makes the cryptocurrency an ideal model for governments choosing to adopt a passive monetary policy. Raskin writes in the Wall Street Journal,
