Yesterday the price of bitcoin reached the new all-time high against the Brazilian Real.
In fact, the national currency of Brazil has been suffering from a strong devaluation for some time now.
For example, taking the American dollar as a reference point, in 2020 alone it lost more than 28% of its value compared to the American currency, going from 0.2484$ at the beginning of January to the current 0.1779$.
Over the course of the year, it fell even lower, reaching $0.1695 in mid-May.
Going back in time, it turns out that it is since January 2018 that the Real has more or less constantly lost value against the American dollar, since it was worth $0.3166 at the time, and has therefore lost almost 44% since then.
It has to be said, however, that in January 2016 it had already been at the levels of the beginning of 2020.
In mid-December 2017, when the price of bitcoin reached an all-time high against the US dollar, the Brazilian Real was worth around $0.2991, i.e. it has lost almost 39% of its value since then.
Therefore, it should not be surprising that yesterday the price of bitcoin has reached an all-time high in Brazilian Real (BRL).
In mid-December 2017, 1 BTC was worth just over 69,000 BRL, before falling to 12,500 in January 2019.
Since then it has started to grow relatively steadily, rising to 44,000 BRL in July 2019, then to 55,000 BRL in May 2020, and over 66,000 in August.
The threshold of 69,000 BRL, however, was broken only yesterday, when it reached its new all-time high of 73,500 BRL.
The price then fell, but remained above BRL 70,000.
Bitcoin at all-time highs while the Real devalues
The Brazilian Real is not only one of those currencies that have been devaluing the most in recent years, but it is also a fiat currency with very high volatility.
Indeed, in some moments, the volatility of the price of the Brazilian Real with respect to the American dollar, for example, exceeded that of bitcoin, although the recent rapid and substantial increases of the price of BTC have caused its volatility to increase to values higher than that of the Real.
It must also be said that the average inflation of the Brazilian Real is almost always higher than that 2% per year which is the target for the US dollar or the euro. For instance, at the beginning of 2020, it was above 4%, only to fall back to 2% due to the coronavirus pandemic, and to start rising again from September.
It is therefore entirely reasonable for Brazilian Real owners to be willing to buy bitcoin at this time.