[trompetenaccoun]

Not exactly the same. Fiat currency like the USD redistribute a lot of wealth from users into the pockets of the central bank/government through unlimited base inflation, which they control. Bitcoin does not have that, its inflation rate is fixed by the protocol and only ever falling. In April this year it will fall to 0.875%.

[DennisP]

And the Ethereum supply is actually shrinking.

[RandomLensman]

Not sure I'd call that an inflation rate as it doesn't factor in any baskets of goods and services.

[trompetenaccoun]

Monetary inflation (i.e. in it's purest form increasing the monetary base by "printing" more) is not necessarily the same as what you probably mean by 'inflation rate'. You're probably talking about price inflation, using CPI. Those are linked but not the same.

Bitcoin "prints" around 1.74% currently and it's going to drop below 1% in April. The USD, although one of the more stable fiat currencies, is worlds apart from that. Looking at official Fed data you can see the base has been inflated by massive amounts just in the past 3 years alone! An increase of way over 60%!

https://fred.stlouisfed.org/series/BOGMBASE

[RandomLensman]

Exactly. "Inflation rate" usually denotes price inflation not change in monetary base or similar measures. More money in circulation can mean price inflation, but it doesn't need to.

[trompetenaccoun]

Sure. It's just that it generally does since the market as a whole understands scarcity value. The fact that having a much larger supply of something decreases the value of the individual unit is intuitively understood by most. The general public tends to price everything in relation to their home country's currency. They don't see the value of the currency falling, they view it as goods getting "more expensive". They do not usually think of fiat currency as a thing that's traded globally against other currencies and goods, but traders and businesses understand this.

Of course, the fact that the recent spike in monetary inflation coincided with a large hike in consumer prices over the past three years (which working class people have definitely noticed) as well as an asset price explosion, could have just been coincidence ;)

[RandomLensman]

That assumes that in increase in monetary base is not matched by an increase in goods and services - you cannot just ignore that part. Also, scarcity as such has no value whatsoever.

FX rate evolution is linked to many things (and sort of a random walk anyway) - I'd say you typically need quite high inflation/rates to see devaluation in line with uncovered interest rate parity type views, short-term it could also work the other way around at times.