Why is the Cantillon effect considered a significant concern for cryptocurrency investors?

3 answers

• Nuria CabotMay 31, 2025 · 2 months ago
  The Cantillon effect is a concept that describes how the distribution of new money affects the economy. In the context of cryptocurrency, it refers to the potential impact of new money entering the market on the value of cryptocurrencies. When new money is introduced into the market, it can lead to inflation and devalue existing cryptocurrencies. This is a concern for investors as it can erode the purchasing power of their holdings. Additionally, the Cantillon effect can create wealth inequality, as those who receive the new money first benefit the most. This can lead to a concentration of wealth in the hands of a few individuals or entities, which goes against the decentralized and egalitarian principles of cryptocurrencies. Therefore, the Cantillon effect is considered a significant concern for cryptocurrency investors as it can undermine the value and ideals of the cryptocurrency market.
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• Dack DachJul 27, 2020 · 5 years ago
  The Cantillon effect is a term that refers to the uneven distribution of new money in an economy. In the context of cryptocurrency, it means that when new money enters the market, it can impact the value of cryptocurrencies. This is a concern for investors because it can lead to inflation and reduce the purchasing power of their cryptocurrency holdings. The Cantillon effect also raises questions about fairness and equality in the cryptocurrency market. If certain individuals or entities have privileged access to new money, they can potentially manipulate the market and benefit at the expense of other investors. Therefore, the Cantillon effect is considered a significant concern for cryptocurrency investors who value transparency and equal opportunities.
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• JHONATTAN DAVIDDec 02, 2023 · 2 years ago
  The Cantillon effect is a concept that highlights the potential impact of new money entering the cryptocurrency market. It suggests that when new money is injected into the market, it can lead to inflation and devalue existing cryptocurrencies. This is a concern for investors as it can erode the value of their holdings. Additionally, the Cantillon effect can create a wealth disparity, where those who receive the new money first benefit the most. This can lead to a concentration of wealth and power in the hands of a few, which goes against the decentralized nature of cryptocurrencies. Therefore, the Cantillon effect is considered a significant concern for cryptocurrency investors who seek a fair and balanced market.
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