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Fighting the crypto winter and token protocol inflation in 2022

2022.07.14 06:27

Fighting the crypto winter and token protocol inflation in 2022
Fighting the crypto winter and token protocol inflation in 2022

There is an old saying, “cash is king,” but if it is sitting in a bank account or, in the case of crypto — a wallet, it diminishes daily due to inflation. This is especially the case now as inflation in the United States breaks its 40-year record. While the dollar-cost-averaging (DCA) strategy allows an investor to minimize the effects of volatility by purchasing an unstable asset in time intervals, inflation still causes a decrease in a target asset’s value over time.

For instance, Solana (SOL) has a pre-set protocol inflation rate of 8%, and if the yield is not generated through farming or utilizing decentralized finance (DeFi), one’s holdings are depreciating at a rate of 8% per year.

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