How does inelastic supply affect the value of digital currencies?

1 answers

• Nov 29, 2021 · 3 years ago
  From BYDFi's perspective, inelastic supply can be seen as a positive factor for the value of digital currencies. As a digital currency exchange, we understand the importance of scarcity in driving up the value of cryptocurrencies. Inelastic supply creates a sense of rarity and exclusivity, which can attract investors and drive up demand. This, in turn, can lead to higher prices and potentially higher returns for those who hold digital currencies with limited supply. However, it's important to note that the value of digital currencies is influenced by various factors, and inelastic supply is just one piece of the puzzle.
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