What a complete yolk! Comparing Bitcoin to Eggs and why it matters
Let’s talk about eggs. Eggs are a staple food for many around the world and one that has changed little since 1980. Free-range, grass-fed, organic; these are all changes and improvements to the egg industry, but the underlying product is fundamentally the same.
However, the price of eggs has been far but consistent, as the data below from the St. Lois Fed indicates. The average price of eggs in 1980 was less than $1, while in 2022, the same product costs around $3, a 3x price.
Due to the impact of long-term inflation, $1 in 1980 has the equivalent in purchasing power of around $3.60 today. This increase amounts to a rise of $2.60 in the space of 42 years. Throughout this time, the Dollar had an average inflation rate of 3.09% per year, producing a cumulative price increase of 259.56%.
Holding an asset like BTC is important on both a long-term horizon and low-time preference. If we change the unit of account from USD to BTC, we get an entirely different chart. When measured in BTC, it looks like the price of eggs has fallen drastically since 2015.
Using today’s Bitcoin price, in 2009, it would cost you $1m for eggs, whereas in 2022, it would be nearly 12,000 Sats (roughly $3.)
While this is more of a theoretical argument than a practical one, it does showcase that the purchasing power of Bitcoin, when compared to an everyday essential such as eggs, has risen dramatically over recent years.
The purchasing power of the Dollar (and most fiat currencies) falls over time. Bitcoin is unique because its purchasing power has continued to rise following each halving cycle. Past performance is not indicative of future success, but Bitcoin’s mechanics don’t change. There is a fixed supply of Bitcoin; no money printer run by a central bank exists.
The amount of Bitcoin that was last active 5+ years ago has reached an all-time high of 25%, meaning a quarter of all Bitcoins have not moved for five years. Therefore, those who purchased Bitcoin in 2017 can now buy more eggs than ever before with their BTC.
Eggcellent news for Bitcoin Hodlers.
For those interested, you can load up a debit card with Bitcoin using companies such as Crypto.com, Ziglu, BitPay, Binance, and many more. Once you’ve done this, you can use your Bitcoin to buy eggs. With 1 Bitcoin, you can buy 122,979 eggs at today’s price in a UK grocery store; or 1 egg for just 0.000008 BTC.
Liam first got into crypto by mining Dogecoin after hours at his video production company in 2013. Since then he has become a ‘blockchain maximalist’ and subsequently, a web3 strategic consultant.Source