Q. With reference to Cryptocurrency, consider the following statements:
1. The supply of Bitcoin is highly inelastic.
2. Value of Stablecoins is pegged to a fiat currency by maintaining equivalent reserves.
Which of the statements given above is/are correct?

[A] 1 only

[B] 2 only

[C] Both 1 and 2

[D] Neither 1 nor 2

Answer: C
Notes:

Both statements are correct. 

  • There will never be more than 21 million coins. This feature makes bitcoin supply almost perfectly inelastic. 
  • Value of Stablecoins is pegged to a fiat currency by maintaining equivalent reserves. 

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