Bitcoin pricing challenges rising US home values

• Fidelity Digital Assets said pricing US homes in Bitcoin shows the dollar has lost purchasing power since 2020.
• A typical US home fell from more than 50 Bitcoin to about 5 Bitcoin over the period.
• Fidelity said Bitcoin's fixed supply makes it a useful measure of long-term currency debasement.

Fidelity Digital Assets said pricing US homes in Bitcoin (CRYPTO:BTC) shows the dollar has lost purchasing power even as home prices have risen.

The firm said a typical US home increased by more than US$100,000 since 2020, but its cost fell from more than 50 Bitcoin to about 5 Bitcoin.

“What appears to be appreciation in housing is more accurately a reflection of an erosion of fiat currency. The issue lies with the unit of account—not the asset itself,” said Fidelity Digital Assets research analyst Zack Wainwright.

Fidelity said decades of monetary expansion and inflation above the Federal Reserve's 2% target have reduced the dollar's purchasing power over time.

The firm said Bitcoin's fixed supply of 21 million coins makes it a useful benchmark for measuring long-term currency debasement rather than changes in asset prices.

Fidelity added that pricing homes in gold, the Magnificent Seven stocks or the Nasdaq index would also show different levels of dollar dilution.

Bitcoin traded near US$63,000 at the time of the analysis, and Fidelity said the asset continues to support its long-term inflation hedge thesis despite recent price volatility.

At the time of reporting, Bitcoin price was $63,219.83.