77. What is the correlation between the value of Bitcoin and the market demand for DW20?

Answer: There is a positive relationship between the two.

On the one hand, when the demand for DW20 increases, the price of DW20 will rise. Users will purchase Bitcoin as collateral to issue DW20 to obtain arbitrage income. This process will promote the increase in the value of Bitcoin. At the same time, when the mortgage rate remains unchanged, changes in the value of Bitcoin do not affect Bitcoin’s ability to adjust the supply and demand of DW20. For example, when the value of Bitcoin drops from US$60,000/unit to US$30,000/unit, although a single Bitcoin’s ability to issue DW20 as collateral has been reduced by half, its price has also been reduced by half. Users can purchase more Bitcoins to maintain the overall ability to adjust the supply and demand of DW20 unchanged.

On the other hand, in the Bitcoin-standard stage, Bitcoin will be used to measure the total wealth of humanity, and DW20 will be used as the ruler of Bitcoin to measure specific commodities. At this stage, as the full value of Bitcoin increases significantly, the total demand for DW20 will also increase significantly.

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