PANews has published a commentary by Emily, a researcher at Bitget Wallet, arguing that many people did what would normally be considered the right things over the past decade and still did not end up materially wealthier in real terms. The article’s core point is that the outcome is tied not only to personal saving habits, but to a monetary framework in which major central banks have spent decades treating roughly 2% annual inflation as a policy goal.
Emily describes that framework as an unwritten contract: wages may rise and account balances may rise, yet the cost of the same house down payment, the same family trip, or the same restaurant meal keeps moving higher when measured by purchasing power. Her premise is that if savers had recognized that rule set earlier and used value-bearing assets rather than cash to perform the storage function of savings, the result over ten years could have looked very different.
How 2% inflation became a policy norm
The piece says inflation is often treated in public discussion as a malfunction in the economic machine. In practice, monetary policy over the past three decades moved in the opposite direction. Major central banks gradually came to see a stable, positive inflation rate, usually around 2%, as an explicit objective.
Emily traces that shift back to New Zealand in 1990. She notes that the Reserve Bank of New Zealand Act 1989 established central bank independence and an inflation-targeting framework, and that New Zealand’s first Policy Targets Agreement in 1990 set a CPI inflation target of 0% to 2%. That is why New Zealand is often described as the birthplace of formal inflation targeting.
Canada, the U.K., and Sweden followed in the early 1990s. In the article’s telling, the number “2%” became the default language of global monetary policy only after larger economies made formal commitments of their own.
The U.S. Federal Reserve did that in January 2012, when it first issued its Statement on Longer-Run Goals and Monetary Policy Strategy in written form and formally set 2% as its longer-run inflation objective, measured by the PCE price index. Emily points out that the Fed was founded in 1913 and took nearly a century to write that number into an official statement, a sign that inflation targeting is a relatively recent institutional invention rather than an inherent feature of central banking.
The Bank of Japan followed with a joint statement with the government in January 2013, setting a 2% price stability target as the monetary anchor of the monetary-policy leg of Abenomics, with the stated aim of ending nearly two decades of deflation and low growth.
The European Central Bank completed its strategy review in July 2021 and changed its earlier wording of “below, but close to, 2%” to a clearer “symmetric 2% medium-term target.” In Emily’s interpretation, that meant deviations above and below 2% were both considered departures from target.
Why central banks chose positive inflation
The article says that if one looks only at the result, deliberately accepting an annual decline in currency value can sound like policy failure. From the central bank perspective, Emily says, it is closer to a rational response to constraints.
The first constraint is the need to avoid a deflationary spiral. If people expect lower prices tomorrow, delaying consumption and investment becomes the rational move. That weakens demand further and can push prices down again. Japan’s “lost two decades,” stretching from the 1990s into the early 2010s, is presented as the clearest case study.
The second is nominal wage rigidity. Companies often struggle to cut nominal wages directly because the move triggers morale damage as well as legal and contractual friction. Moderate inflation creates a less visible adjustment path: nominal wages stay flat while real purchasing power slips.
The third is policy room for rate cuts. Nominal rates rarely move far below zero, the so-called zero lower bound problem. With a 2% inflation target, nominal rates usually stay in positive territory, which leaves central banks some capacity to cut when recession hits. If long-run inflation were targeted at 0%, nominal rates could spend long periods pinned near zero.
Compounding makes 2% larger than it sounds
Emily argues that “2% a year” sounds mild only until compounding is taken seriously. Using the compound formula, she writes that a 2% annual inflation rate implies cumulative price growth of about 21.9% over 10 years, since 1.02 to the 10th power is roughly 1.219. That corresponds to a purchasing-power decline of about 18%.
Over 35 years, the article uses the rule of 72 as a rough shortcut. Seventy-two divided by 2 equals 36, suggesting that purchasing power is cut roughly in half every 35 years or so. A young worker who simply holds the same nominal amount of savings until retirement could find that the real value has been reduced by about half.
That is why Emily describes the 2% framework not as a one-off cost, but as a machine that keeps running. Money set aside today is not standing still in real terms. It is steadily losing purchasing power.
The gap between the target and real-world inflation
The article then turns to the distance between official promises and what actually happened. If central banks could hold inflation at 2% with precision, savers would at least know the rule they were planning around. Emily says the last decade has been much harsher than that tidy line suggests.
She points to the global inflation shock after 2020. Supply-chain disruption, surging energy prices, and the overlap of fiscal and monetary easing pushed realized inflation in the U.S., the euro area, and other large economies far above target between 2021 and 2023. U.S. CPI peaked at 9.1% in June 2022. Euro area HICP peaked at 10.6% in October 2022, around three to four times the policy target.
Even if inflation eased in 2024 and 2025, Emily says the cumulative inflation path over the decade most likely still deviated sharply from the idealized line of “exactly 2% each year.” A saver who planned entirely around the official target would therefore have understated the real loss of purchasing power.
The article also cites more extreme currency cases. The Japanese yen suffered a historic weakening in the past decade, with the Bank of Japan’s ultra-loose stance and the large rate gap versus the Federal Reserve pushing USD/JPY to levels not seen in decades after 2022. The Turkish lira is described as an extreme case in modern monetary history after years of high inflation and unconventional low-rate policy. The Argentine peso is presented as another version of fiat-credit breakdown, shaped by repeated debt defaults and inflation cycles.
Emily’s conclusion from those cases is straightforward: 2% is not guaranteed by any physical law. It is a policy promise, and the credibility of that promise depends on the independence, discipline, and broader fiscal and political setting of the institutions behind it.
A promise with no collateral behind it
The article says this is the most overlooked point in the whole framework. Central banks may promise 2%, but there is no guarantee standing behind that promise.
If money is lent to a company, creditors may have collateral, seniority, or at least contract terms spelling out what happens in default. By contrast, when a household stores lifetime savings in the domestic currency, there is no collateral, no penalty clause, and no legal recourse against the issuer if inflation runs far above target. Whether the deviation comes from external shocks, policy mistakes, or fiscal pressure forcing monetary concessions, the saver bears the loss.
Emily ties that asymmetry to the three classic functions of money: unit of account, medium of exchange, and store of value. In her view, the first two are deeply embedded in law and institutional design. Wages are denominated and paid in fiat money. Taxes are paid in fiat money. Mortgages, auto loans, and most long-term debt contracts settle in fiat money. Exiting that system is close to impossible for ordinary households.
The store-of-value function is different. The article says that in most countries, there is no legal requirement for individuals to keep long-term savings in domestic cash. Savings can legally move into gold, stocks, real estate, or other assets that a household believes will preserve value more effectively.
Why most households still leave savings in cash-like form
Emily argues that people are not staying in fiat because fiat is well suited for long-term value storage. In her view, the data from the past decade point the other way. The real reason is the friction involved in moving savings from domestic cash into other assets.
She lists several barriers. Opening a brokerage account or an offshore asset account often means lengthy identity verification and compliance checks. Many quality assets come with minimum investment thresholds that put them out of reach for ordinary wage earners. Deciding when to buy, how much to buy, and whether to time entries demands knowledge many people do not have.
There is also a psychological barrier. For decades, “saving money” has been treated as almost synonymous with “putting money in the bank,” while “buying assets” is often treated instinctively as speculation rather than saving.
According to the article, that mix of operational and cognitive hurdles is what keeps most people locked into a track where depreciating money continues to perform the savings function.
Three paths, three outcomes over ten years
The piece then shifts from theory to a simple scenario. Imagine it is 2015 and a person has 100,000 yuan. No trading. No market timing. Only one decision: buy one type of asset and hold it until 2025.
Emily says many people effectively chose the first route: leave money in the bank and accept a steady nominal return. The problem is that inflation over the same period eroded much of that gain. The article states that 100,000 yuan becoming 121,900 yuan looks like a 21,900 yuan profit on paper, yet U.S. cumulative inflation over the period was about 30%, while Japan’s cumulative inflation was also well above its long-run average. Real purchasing-power gains may therefore have been very limited.
That leads to one of the article’s sharpest claims: wealth growth depends not only on how much money a person earns, but on where that money sits. In many cases the decisive factor is not trading skill. It is the savings vehicle.
Emily then translates the comparison into three broad categories of real-life behavior.
Type A: fiat savers
The first group is made up of people who were diligent, cautious, and unwilling to take risk. They kept money in bank time deposits or low-volatility money-market wealth products sold through bank channels. Over ten years their balances rose slowly, and their nominal yields looked better than demand deposits.
In real terms, the article says, much of that effort merely offset inflation. In years when inflation overshot expectations, real purchasing power may have fallen outright. Emily’s point is that this group did not make the wrong choice by traditional standards, yet still had the hardest outcome in the ten-year game she describes.
Type B: asset holders
The second group moved idle fiat liquidity into hard assets such as gold, quality equities, and Bitcoin, then held for the long run rather than trading frequently. Emily says many of them were not professionals at all. Some simply bought and did not touch the position again. That inactivity, in her framing, let them absorb much more of the expansion in global asset prices over the decade.
Type C: altcoin speculators
The third group also tried to escape fiat debasement, but chose weak vehicles to do it. Emily describes them as speculators who moved into altcoins with little fundamental value support and heavy dependence on narrative and liquidity. Her summary is blunt: over the past decade, most altcoins went to zero or near zero.
The point of that example is not that leaving fiat is always wrong. It is that destination matters. Not every non-fiat asset preserves value by default. Scarcity, strength of consensus, and genuine demand are what determine whether an asset can survive across cycles.
What central banks themselves have been buying
Emily introduces another lens that she says cuts through theory and opinion: look at the balance sheets of central banks themselves. According to the article, official reserve managers around the world have spent the past several years accumulating gold at historically large scale.
Citing the World Gold Council, the piece says gold prices hit repeated record highs in 2025 and that total gold buying by central banks also reached a substantial level. For Emily, this carries more weight than abstract theory. Central banks understand better than anyone that fiat money has built-in limits as a store of value. Their own allocation decisions show that awareness, even if they do not spell it out to retail savers.
How the argument extends into crypto rewards
The article ends by bringing the same logic into crypto payments and cashback products. Emily says many U-card programs promised high cashback rates while obscuring what she calls the end state of the reward token itself.
With fiat or stablecoin cashback, the sequence is simple: spend, reduce fiat holdings, and leave the remaining fiat sitting in an account where it does not appreciate and may lose value. In that setup, spending still leaves the user exposed to inflation erosion on the remaining savings base.
With token cashback, the sequence changes to spend stablecoins and receive an altcoin reward from a merchant or platform. Emily argues that the structure introduces an incentive, but if the reward asset lacks real scarcity and demand support, the reward is likely to be diluted toward zero over time. In her view, that is still value loss, only in a different wrapper.
She says RWA and tokenized U.S. equities offer another route for crypto. In the past, BTC was the only crypto asset with broad global recognition, but putting real-world assets and U.S. equities on-chain changes the set of choices. The article gives Assetback-style asset cashback as an example. If the reward returned to users is a hard asset with long-term value support, user spending could be tied to the accumulation of value-bearing assets.
Emily closes on that point. Individuals cannot change the fact that major central banks have set 2% inflation as a long-running target, and they cannot change the fact that the promise comes without collateral. What they can change, she says, is the asset that receives their money once fiat leaves their hands.
In her framing, that may be one of the plainest and most effective responses available to ordinary people in a “2% game” that has lasted for more than three decades and shows no sign of ending.