The Cantillon Effect, named after the 18th-century French economist Richard Cantillon, describes the uneven distribution of inflation that occurs when new money is introduced into the economy.

This is partly because new paper money is created at virtually zero cost and handed over to specific parties. These parties have an advantage: they can spend the money on goods and assets whose prices have not yet reflected the increase in the money supply. Thus, they can buy goods at a lower rate.

As the new money flows from central banks to private banks, from investors to ordinary citizens, prices gradually begin to reflect the increased money supply. By the time ordinary citizens feel the increase in the money supply, they will be buying goods at higher prices.

So, the essence:

• The central bank prints new money.

• The first to receive the money are those who have access to it (the government, large companies, and banks).

• The privileged group spends the money, buying goods and services.

• Prices for these goods and services rise.

• Those who receive money later (e.g., through salaries) buy fewer goods because prices have already risen.

Thus, the flow of new money through the economy benefits those parties who receive the funds first and is less advantageous to those who receive them later.

Economists argue that since 2009, the global economy has grown significantly, with profits measured in trillions of dollars.

However, if you compare your purchasing power today with what it was 15 years ago, the situation looks different. For example, with a budget of $500, you cannot buy the same groceries in the supermarket that you could 15 years ago.

This is due to the Cantillon Effect, which leads to a decrease in your purchasing power. Essentially, you become poorer as the rise in prices outpaces your income.

This is why many Bitcoin enthusiasts and some economists argue that $BTC has become a countermeasure to the Cantillon Effect.

For example, ten years ago, one Bitcoin cost around $500, and today its price reaches $65,000.

Their arguments are as follows:

• Unlike uncontrollably printed paper money, $BTC has a limit of 21 million coins. This ensures its scarcity, making it less prone to inflation.

• The decentralized nature of Bitcoin makes it accessible to anyone with an internet connection. This opens up opportunities for financial inclusion, allowing people from marginalized groups to access financial services without intermediaries like traditional banks.

• The lack of control by central banks and the transparency of transactions prevent the uneven distribution of funds and the unjust enrichment of individuals.

So, have you felt the Cantillon Effect yourself? 🤔

The Cantillon Effect, named after the 18th-century French economist Richard Cantillon, describes the uneven distribution of inflation that occurs when new money is introduced into the economy.

This is partly because new paper money is created at virtually zero cost and handed over to specific parties. These parties have an advantage: they can spend the money on goods and assets whose prices have not yet reflected the increase in the money supply. Thus, they can buy goods at a lower rate.

As the new money flows from central banks to private banks, from investors to ordinary citizens, prices gradually begin to reflect the increased money supply. By the time ordinary citizens feel the increase in the money supply, they will be buying goods at higher prices.

So, the essence:

• The central bank prints new money.

• The first to receive the money are those who have access to it (the government, large companies, and banks).

• The privileged group spends the money, buying goods and services.

• Prices for these goods and services rise.

• Those who receive money later (e.g., through salaries) buy fewer goods because prices have already risen.

Thus, the flow of new money through the economy benefits those parties who receive the funds first and is less advantageous to those who receive them later.

Economists argue that since 2009, the global economy has grown significantly, with profits measured in trillions of dollars.

However, if you compare your purchasing power today with what it was 15 years ago, the situation looks different. For example, with a budget of $500, you cannot buy the same groceries in the supermarket that you could 15 years ago.

This is due to the Cantillon Effect, which leads to a decrease in your purchasing power. Essentially, you become poorer as the rise in prices outpaces your income.

This is why many Bitcoin enthusiasts and some economists argue that $BTC has become a countermeasure to the Cantillon Effect.

For example, ten years ago, one Bitcoin cost around $500, and today its price reaches $65,000.

Their arguments are as follows:

• Unlike uncontrollably printed paper money, $BTC has a limit of 21 million coins. This ensures its scarcity, making it less prone to inflation.

• The decentralized nature of Bitcoin makes it accessible to anyone with an internet connection. This opens up opportunities for financial inclusion, allowing people from marginalized groups to access financial services without intermediaries like traditional banks.

• The lack of control by central banks and the transparency of transactions prevent the uneven distribution of funds and the unjust enrichment of individuals.

So, have you felt the Cantillon Effect yourself? 🤔