Dollar's Purchasing Power Erodes by 97% as Bitcoin Rises

The US dollar has undergone a significant decline in its purchasing power over the past century. According to data from the Bureau of Labor Statistics, $1 in 1913 had a purchasing power equivalent to approximately $33 to $34 in 2026. This translates to a loss of roughly 97% of its purchasing power since the Federal Reserve was established.

The decline reflects over a century of inflation, including two world wars, high-inflation periods, and sharp price increases in 2021-2023. The end of US dollar convertibility into gold in 1971 marked a major change in the monetary system, further eroding its purchasing power.

Bitcoin supporters often point to this long-term erosion in dollar purchasing power as an argument for scarce digital assets like Bitcoin. With a maximum supply of 21 million coins and a predetermined issuance schedule, Bitcoin's scarcity is designed to reduce the creation of new BTC over time.