Mischa on Nostr: Inflation leads to more centralization over time because it makes it harder to save ...

Inflation leads to more centralization over time because it makes it harder to save money. People start buying assets to protect their wealth. The higher the inflation, the more assets they need. Over time, people buy more and more assets to secure their wealth. As inflation rises, assets become more expensive, and those who own many assets make even more money. At the same time, because more people are buying assets just to protect their money, fewer assets are being sold or traded. This reduces the supply of assets, and since demand stays high, prices keep rising. This cycle pushes wealth and resources into fewer hands, leading to centralization.

#inflation #assets #centralisation