Bitcoin's Inflation-Adjusted High Falls Just Short of $100K: Galaxy Digital:

"Bitcoin has nominally broken through $126,000 in October, but in terms of purchasing power, it has not yet reached $100,000, far less $200,000," according to the global head of research for Galaxy Digital, Alex Thorn. In 2020 dollars, the market peak of Bitcoin this year reached $99,848.

Thorn added that inflation in the U.S. increased by about 24% over the 2020-2025 period. Thus, nominal price comparison may be deceptive. For instance, the nominal price may show that a bitcoin cost this much, but the inflation-adjusted, or "real", price provides the value of the asset's purchasing power in relation to a given year, which in this case is 2020.

This breakdown provides some enlightenment for both the bull and bear sides. On the bull side, they could argue that the current bitcoin run from the lows in 2022 has still plenty of room ahead of it, implying that there is still more "froth" than the realized top of $126,000. On the other hand, the bears could find justification in the relatively weaker performance in terms of dollar debasement.

Nonetheless, the importance of actual purchase power when analyzing the long-term evolution of crypto is evident.

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