How Much Has the Dollar Lost to Inflation Since Bitcoin Launched?
Based on US CPI-U data, cumulative inflation between 2013 and 2025 totals roughly 37%, meaning $1,000 in 2013 had the purchasing power of only about $730 by 2025. Any crypto (or other asset) return should be measured against this baseline erosion, not against a static, unchanging dollar.
Why this baseline matters
Every investment return claim implicitly compares a future dollar amount to a past one. If the measuring stick itself (the dollar) has shrunk by roughly a third in purchasing power over the period, ignoring that shrinkage overstates every single nominal return quoted — not just crypto's.
How the compounding actually works
Inflation compounds the same way investment returns do. A steady ~3% annual rate compounds to roughly 37% over 12 years, not 36% (3% × 12) — the difference becomes larger the longer the period and the higher the rate.
What this means for your own portfolio
If you're comparing a crypto purchase from 2013-2017 to today, subtract this baseline erosion before celebrating (or panicking about) the nominal number. The Crypto Reality Check does this calculation automatically for any start and end year in that range.
Frequently asked questions
Is CPI-U the same as 'inflation'?
CPI-U is the most commonly cited headline inflation measure in the US, tracking a broad basket of consumer goods and services, though it's not the only inflation measure economists use.
Does inflation affect cash the same way it affects crypto?
Inflation affects the purchasing power of any dollar-denominated value equally. The difference is that crypto (and other assets) may also appreciate in nominal price, potentially offsetting the erosion, whereas cash sitting idle typically does not.