The bitcoin purchasing power index (bitcoinppi) tells you how many Big Mac hamburgers you can buy with one bitcoin.This is helpful when you want to know the everyday value of bitcoin.So far the value of bitcoin has only been quoted in fiat currencies like the US dollar, European euro or others.This measure is strained by increases in the overall level of consumer prices (aka inflation).It might happen for instance that the value of bitcoin in US dollars goes up from 300 USD to 305 USD but the products that one bitcoin buys you (purchasing power) remains the same.Inflation is influenced by monetary policy and should not get in the way of measuring the value of a central bank independent currency.The bitcoinppi measures the value of bitcoin by its purchasing power of a worldwide available and uniform item - the Big Mac hamburger.This makes the bitcoin purchasing power index agnostic to monetary policy.The bitcoinppi hence lets you express bitcoin's value in a central bank independent way.

Much similar to how bitcoin operates technologically as a currency and payment network.In order to buy a Big Mac with one bitcoin you will need to convert it to a local currency like the pound, peso etc.The local bitcoinppi does exactly that.It tells you how many Big Macs you can buy with one bitcoin in a specific country.This is because bitcoin exchange rates and Big Mac prices differ from one country to another.When you want to buy Big Macs with a bitcoin in the UK, a different exchange rate applies and the Big Mac price is not the same as in Mexico for example.bitcoin pool germanyThe calculation of the local bitcoinppi only uses real local Big Mac prices as recorded by the Big Max index and only local exchange rates as they were available if you wanted to buy or sell bitcoins in that specific country.bitcoin iphone widget

The bitcoinppi does not use cross-rates to derive exchange rates from cross-currency pairs because these rates are in most cases not accessible to consumers.The global bitcoinppi is a weighted average of local bitcoin purchasing power indices.It tells how many Big Mac burgers you can buy with one bitcoin on average globally.Each available local bitcoinppi is considered in the global bitcoinppi.The weights are calculated based on a country's population and the GDP per capita in purchasing power parity.bitcoin pool germanyBesides just expressing the value in a central bank independent way, there are multiple other use cases for the bitcoinppi.bitcoin atm machine new yorkNote that the bitcoinppi API provides all the raw data you need to use this index in every imaginable way.bitcoin escrow api

If you use it for something cool, we would love to hear about it in the comments!Here are a few use case ideas The bitcoinppi volatility measures the average daily return volatility of of the global bitcoinppi over the last 30 days and expresses it as an annualized value.The volatility data is not provided by our API but you can easily calculate it yourself with daily index information.This is the formula we use to calculate the bitcoinppi volatility STDEV(ln(bitcoinppi_global(d) / bitcoinppi_global(d-1)) * SQRT(365) with d = 1..30 The bitcoinppi is updated every 15 minutes and is calculated as follows bitcoinppi_local(country_i) = (btc_price(currency_country_i) / big_mac_price(currency_country_i)) bitcoinppi_global = SUM(bitcoinppi_local(country_i) * weight(country_i)) with i = i..I weight(country_i) = (population(country_i) / SUM(population(country_i..I))) * 1/3 + (GDPperCapPPP(country_i) / SUM(GDPperCapPPP(country_i..I))) * 2/3 There are three main data sources to calculate the bitcoinppi.bitcoin was sind shares

We need Big Mac prices, bitcoin exchange rates and macroeconomics data for each country that is included in the index.The Big Mac index as published by The Economist is a great source for local Big Mac prices.The Big Mac index is updated every six months and so are the Big Mac prices that are contained in it.Note that the bitcoinppi doesn't use the actual Big Mac index itself.Instead we leverage the fact that the Big Mac index tracks a large number of local Big Mac prices in a reliable way on a regular basis.bitcoin mining 0 shares acceptedWhenever there are new prices available from the Big Mac Index they will be imported into the bitcoinppi.local bitcoin ottawaThe Big Mac is a hamburger that is served in Mc Donald's fast food restaurants in approximately 40 countries around the world.nakamoto bitcoin account

Bitcoin price data is sourced from BitcoinAverage and bitcoincharts.We only use prices of local markets that are available to consumers who buy and sell bitcoins in those markets.For some historical bitcoin prices (until October 2015) we used the CoinDesk bitcoin price index BPI.In these cases we had to rely on cross-rates.Macroeconomic data is sourced from Trading Economics.Historical values for population and GDP per capita are not yet included.We will update the data in the next weeks.Please note that the index will recalculate based on a different set of historical macro data and will therefore likely change.About Latest Posts Latest posts by George Basiladze (see all) Where does the real power of Bitcoin lie: Purchasing power vs.Remittance Bitcoin remains a wholly under appreciated technology, despite the growing interest in the underlying blockchain.There are several key features that make bitcoins a great alternative to bank-issued fiat currencies, including the decentralisation and consensus the software is built on.

The peer-to-peer nature of the cryptocurrency makes it an extremely effective, low-cost means of transferring funds all over the world.This leads to a question which is regularly discussed: Is Bitcoin most useful as an online currency which is used for regular everyday spending, or as a more specialist asset where use is focused towards cross-board transfers and remittance?The cryptocurrency is often cited as a great option for remittance, but the international money transfer market is plagued by heavy regulation, which businesses offering Bitcoin remittance services are unlikely to be able to avoid in the long run.For example, CoinCave, a Bitcoin remittance start-up was forced out of the US market, due to regulation and difficult to obtain licenses.The difficulties faced by Bitcoin start-ups focused on the remittance sector are related to the complex international arrangements aimed at preventing money laundering.Complicated regulatory frameworks are in place, and these are largely responsible for many of the negative aspects of existing remittance services such as Western Union, including the high fees that they charge.

Despite this, Bitcoin can be used as an effective means of sending funds all around the world and as use of the cryptocurrency becomes more widespread, bitcoin-based remittance services will likely become more and more viable.As bitcoins cannot easily be spent in most parts of the world currently, remittance services must convert users’ funds at each end of the transaction.This is not particularly efficient, but as more and more services appear which facilitate the spending of bitcoins, remittances using bitcoins could become more affordable and appropriate for a wider range of people.There are already services which allow the purchase of gift cards and virtual debit cards using bitcoins; enabling people to really put the cryptocurrency to use.But if the people receiving remittance payments were able to easily spend their coins at local businesses then the need to convert transferred payments into the local currency, and therefore also the need to go through a regulated remittance service rather than just using direct peer-to peer payments, would be greatly reduced.

This, in turn, would make Bitcoin a much more cost effective solution.An ever-increasing number of transactions are made using e-commerce systems, where bitcoin could easily be integrated.As growing numbers of people use and engage with Bitcoin, the cryptocurrency could be utilised more for online purchases.There are also growing numbers of freelancers who are being paid with bitcoins; as the work-life balance shifts and the internet changes the way we work, could bitcoin become a significant, or even dominant currency?The cryptocurrency is a cheaper means of paying for goods than PayPal, and businesses are protected against chargebacks.Although intended as a protection for consumers, chargeback capabilities are often abused and can cause many issues for businesses.The irreversible nature of bitcoin transactions puts a stop to this; consumers are essentially forced to trust businesses which has positives and negatives.Escrow systems can help to limit the trust required by users, by essentially adding in a third-party mediator.