Inflation in Australia has reached a 32-year high. According to P2P bitcoin trading volume, Australians are turning to bitcoin (BTC) to hedge against inflation.
Australians are turning to bitcoin and cryptocurrencies as the country’s inflation rate hits a 32-year high. According to the Australian Bureau of Statistics, the Consumer Price Index rose 1.8% in the previous quarter. This brings the annual rate of inflation to 7.3%, the highest since 1990.
Australia Inflation Rate: Trading Economics.com
As this inflation rate rises, Australians are turning to bitcoin to protect their wealth. P2P trading volume for the asset has increased in recent quarters. Q3 2022 volumes grew 15% from the prior quarter, compared to 27% year-on-year growth. Similarly, Q2 2022 saw a year-on-year growth of 31%.
These numbers are especially significant given the bear market that the crypto asset class is going through this year. Australians are clearly willing to put some of their wealth into bitcoin to hedge against inflation. Although the story has been losing some of its weight in recent months, it hasn’t completely disappeared.
Bitcoin Still Seen as an Inflation Hedge
Inflation in Australia is a matter of concern among experts. The Reserve Bank of Australia (RBA) had expected inflation to peak at 6%. Analysts expect this quarter to see even worse figures in key and key measures. As such, the RBA may hike rates, which is already happening in many countries.
Since May, the RBA has increased rates by 250 basis points, a significant figure. In times like these, the rise in bitcoin trading means that Australians are looking to the crypto market as a place to keep their money safe.
Australia working on crypto regulations
While Australians are increasing their position in bitcoin, the government is upping its game on crypto regulations. The Australian Treasury issued a statement in August saying it had begun work on crypto asset reforms. It claims this regulation would be contrary to “anywhere else in the world”.
The government is expediting work on regulations due to the use of crypto in criminal activities. The federal law enforcement agency believes it to be an emerging threat, as do many other law enforcement agencies. Australia’s securities regulator has also recently suspended three crypto funds by Holon.
Meanwhile, Australia has published a CBDC whitepaper and released details on a pilot program. The government is very keen to take advantage of the technology and the pilot will last for a year.
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