Why Haven't You Become Richer in the Past 10 Years?

What we can change is what assets catch the currency the moment it flows out of our hands.

Written by: Emily, Researcher at Bitget Wallet

Introduction: A Contract Unknown and Unsigned

In the past decade, you may have received promotions, salary increases, and learned to spend money more wisely—using credit card cashback rules and various "money-saving" techniques to minimize the marginal cost of every purchase. You did all the "right" things.

But if you convert the numbers on your paycheck into purchasing power from ten years ago, you will discover something uncomfortable: wages are rising, account balances are increasing, but the things you can buy—the same down payment for a house, the same family vacation, the same dinner that once felt "a bit expensive but still affordable"—are quietly becoming more expensive.

This is not an illusion, nor is it a reflection of your financial management skills. It is the result of a contract, one you have never read or signed, but one you are fulfilling every day. The other party to the contract is the major central banks around the world, and the terms are simple: every year, the currency in your hands will depreciate by about 2%. This is not an accident or a mistake, but a policy goal established by almost all major economies over the past thirty years.

The question is: if we had known the terms of this contract ten years ago and chose not to use cash, but rather to fulfill the function of "savings" with valuable assets, how different would our situation be today? This article aims to calculate this account seriously.

2%, A Public "Depreciation Commitment"

Inflation is Not a Malfunction, It's by Design

In most people's minds, inflation seems like a malfunction of the economic machine, a state of imbalance that needs to be "cured." However, the actual evolution of monetary policy over the past thirty years has been quite the opposite: major central banks around the world have gradually regarded stable positive inflation (around 2%) as an important goal of monetary policy.

This turning point can be traced back to New Zealand in 1990. At that time, New Zealand had just emerged from the high inflation quagmire of the 1970s and 1980s. The Reserve Bank of New Zealand Act 1989 established the independence of the central bank and the inflation target framework. The first Policy Targets Agreement (PTA) signed by New Zealand in 1990 set the CPI inflation target at 0-2%, and New Zealand is often regarded as the birthplace of the "inflation targeting" system.

This framework has proven to be highly "contagious." Canada, the UK, Sweden, and other countries followed suit in the early 1990s. However, what truly made the number "2%" the default language of global monetary policy were statements from several larger economies that were belated yet far-reaching:

The Federal Reserve first formally published the Statement on Longer-Run Goals and Monetary Policy Strategy in January 2012, officially establishing 2% (measured by the PCE price index) as the "long-term" inflation target. This was the first time in the Federal Reserve's history that it publicly announced a clear long-term inflation target. Notably, the Federal Reserve was established in 1913, yet it took nearly a century to write this number into a formal statement, highlighting that "inflation targeting" itself is a relatively young institutional invention, not an inherent attribute of monetary policy.

The Bank of Japan issued a joint statement with the government in January 2013, setting a 2% "price stability target" as the core anchor of the monetary policy pillar of "Abenomics," aiming to end nearly two decades of deflation and slow growth.

The European Central Bank completed a monetary policy strategy review in July 2021, revising its previous vague statement of "below but close to 2%" to a clearer "symmetric 2% medium-term target"—meaning that inflation above or below 2% is also seen as a deviation, rather than "the lower, the better."

Why Central Banks "Had to" Make This Choice

If we only look at the results, "actively choosing to let currency depreciate every year" sounds like a dereliction of duty. However, from the perspective of the central banks' own policy logic, this is almost a reluctant yet rational choice, constrained by three layers of reality:

First, avoiding a deflationary spiral. The reason deflation is scarier than mild inflation lies in psychological mechanisms: if people expect prices to be lower tomorrow, the most rational choice is to postpone consumption and investment, which further depresses demand, leading to continued price declines and forming a self-reinforcing spiral. Japan's "lost two decades" from the 1990s to the early 2010s is often cited as the most painful case study of this logic.

Second, adapting to the rigidity of nominal wages. A repeatedly verified phenomenon in economics is that companies find it extremely difficult to directly lower employees' nominal wages (even during tough times), as this would cause a strong morale blow and legal/contractual friction. However, mild inflation provides an "invisible" adjustment channel—nominal wages remain unchanged, but actual purchasing power can be quietly adjusted downwards with inflation, allowing companies to complete flexible adjustments to actual compensation without triggering employee backlash.

Third, preserving policy space for interest rate cuts. Nominal interest rates are difficult to lower significantly below zero (the so-called "zero lower bound" issue). If the target inflation is 2%, nominal interest rates will usually remain at a positive level, so that when an economic recession strikes, the central bank still has the option to "cut interest rates." If the long-term target inflation is 0%, nominal interest rates may hover around zero for years, and once a crisis occurs, the central bank has no traditional space for interest rate cuts.

The Cruelty of Compounding: 2% is Not a Small Number

"2% per year" sounds mild and harmless, but compounding is never gentle. According to the compound interest formula, a 2% annual inflation rate means:

In 10 years, cumulative prices will rise by about 21.9% (i.e., 1.02^10 ≈ 1.219), corresponding to a purchasing power decline of about 18%.

In 35 years, according to the approximate estimate of the "Rule of 72" (72÷2=36), purchasing power will be roughly halved every 35 years. In other words, a young person just starting their career will find that the same amount of savings will only retain about half of its purchasing power by the time they retire.

This is the true weight of the "2%" contract: it is not a one-time loss, but a continuously operating, never-stopping depreciation machine. The 10,000 yuan you save today is not "sitting there doing nothing"; it is "slowly burning away every day" in front of this machine.

Unfulfilled Performance: The Huge Gap Between Commitment and Reality

If central banks could truly control inflation precisely at 2%, then "2%" would at least be an honest contract; you know the rules and can plan accordingly. However, what has actually happened in the past decade is far more complex and cruel than "mild 2%".

The global inflation shock after 2020 is the most direct manifestation of this gap. Supply chain disruptions, soaring energy prices, and the dual easing of fiscal and monetary policies have caused the actual inflation rates in major economies like the United States and the Eurozone to significantly exceed the 2% target between 2021 and 2023. The peak inflation of the US CPI reached 9.1% in June 2022, and the peak inflation of the Eurozone HICP reached 10.6% in October 2022, three to four times the target level.

Even if inflation recedes in 2024-2025, the cumulative inflation path over the past decade is likely to have significantly deviated from the ideal curve of "precisely 2% per year." This means that if you plan your savings depreciation speed entirely based on the "officially promised 2%", you are almost certainly underestimating the actual loss of purchasing power.

And this is just an example of "mild deviation." More extreme samples occur in economies where the currency's credit itself has structural problems:

The Japanese yen has experienced a historic collapse in exchange rates over the past decade. Due to the Bank of Japan's long-term maintenance of ultra-loose monetary policy and the significant interest rate differential with the Federal Reserve's rate hike cycle, the yen's exchange rate against the US dollar fell to a level not seen in decades after 2022.

The Turkish lira has seen a depreciation that is an extreme case in monetary history over the past decade: persistent high inflation and an unconventional low-interest-rate policy combination have caused the lira's purchasing power against the US dollar to plummet.

The Argentine peso tells another version of the "collapse of fiat currency credit": repeated debt defaults and a vicious inflation cycle have made the peso one of the most frequently cited samples in global currency depreciation case studies.

These extreme samples remind us of an easily overlooked yet fatal point: "2%" has never been a number guaranteed by physical laws; it is merely a policy commitment— and the credibility of that policy commitment depends on the independence, discipline, and the fiscal and political environment of the institution executing it.

Commitment, but No Guarantee

This is precisely the most easily overlooked yet most deadly point in the entire logic: the central bank has committed to 2%, but this commitment has no guarantee.

If you lend money to a company, you usually receive collateral, priority repayment, or at least a contract clause specifying the consequences of default. However, when you "store" your life savings in the form of your national currency, there is no collateral, no penalty clauses, and no legal recourse between you and the institution that issues this currency. If actual inflation significantly deviates from the target, whether due to external shocks, policy errors, or fiscal pressures forcing monetary policy concessions, when the currency depreciates, you have no contractual tools to demand compensation. All you can do is endure.

This asymmetry stems from the three classic functions of money: unit of account, medium of exchange, and store of value, which differ greatly in terms of legal enforcement.

The first two functions are almost institutionally mandated: your salary must be denominated and paid in legal tender, your taxes must be paid in legal tender, and your long-term debt contracts, such as mortgages and car loans, are almost all settled in legal tender. This is the infrastructure of modern economic operation; you cannot opt out, and there is almost no room for negotiation.

However, the function of "store of value" has never been mandated. In most countries, the law does not require individuals to hold assets in the form of local currency cash as a long-term savings method. You can legally convert your savings into gold, stocks, real estate, or any other asset form that you believe can preserve value better.

Who is "Packaging for Currency"?

The answer is not that currency is suitable for "store of value"; data from the past decade has repeatedly proven the opposite. Rather, it is because the threshold for switching savings from "local currency cash" to "other assets" is too high:

Opening a securities account or an offshore asset account involves cumbersome identity verification and compliance processes;

The minimum investment thresholds for many quality assets keep ordinary wage earners out;

When to buy, how much to buy, and whether to time the market require professional knowledge that ordinary people do not possess;

More importantly, there is a psychological barrier— the action of "saving money" has been implicitly equated with "putting money in the bank" for decades, and switching to "buying assets" is intuitively misinterpreted as "speculation" rather than "savings."

This dual threshold of operation and cognition is the invisible wall that truly locks the vast majority of people into the track of "saving with depreciating currency." However, the cost of this wall has been infinitely magnified over the past decade.

Three Types of People, Three Fates

At this point in theory, it is time to look at the real numbers. Over the past decade, the differences in outcomes brought about by different "savings vehicle choices" have transcended the magnitude of "outpacing inflation" or "falling behind inflation"; they have become a divide that changes destinies.

Assuming we rewind to 2015. You have 100,000 yuan, make no trades, do not time the market, and only perform one action: buy an asset and hold it until 2025. What would be the approximate result of this 100,000 yuan after ten years?

Many people’s choices over the past decade have essentially been to leave their money in the bank, earning stable nominal returns. The problem is that during the same period, cumulative inflation in the U.S. was about 30%, and Japan's cumulative inflation was also significantly above the long-term average. In other words, 100,000 yuan turning into 121,900 yuan seems to have earned 21,900 yuan, but the actual increase in purchasing power may be very limited.

This is the most easily overlooked fact of the past decade: wealth growth depends not only on how much you earn but also on where you place your money. The widening gap is often not due to trading ability but rather the choice of savings vehicle.

When looking at these two sets of data together, a conclusion emerges that is far sharper than "inflation is annoying": over the past decade, smart money has completely decoupled the two functions of currency: "exchange" and "storage."

The Decade of Three Types of People

If we translate these numbers into three real-life choices, we can roughly outline three trajectories:

Type A: Fiat Currency Investors. They are diligent, cautious, and risk-averse, depositing their hard-earned money into bank fixed deposits or buying "stable" money market fund products recommended by banks. After ten years, the numbers in their accounts have indeed grown slowly, and the nominal yield appears to have "outpaced" that of demand deposits. However, when adjusted for actual purchasing power, their decade of hard accumulation has largely just barely offset the erosion of inflation, and in years of unexpected inflation, they may even experience a net loss in actual purchasing power. They have not done anything "traditionally correct," yet they remain the most burdened group in this decade-long game.

Type B: Asset Players. What they do is fundamentally simple: they quickly convert idle fiat liquidity into hard assets like gold, quality stocks, and Bitcoin, and hold them long-term without frequent timing trades. This group may not be professional investors; many are simply "too lazy to manage" and do not fiddle with their investments after buying. Yet it is this "laziness" that has allowed them to fully enjoy the significant premiums brought about by the global asset price expansion cycle over the past decade.

Type C: Altcoin Speculators. This is the most easily overlooked yet equally important sample group; they also attempt to "escape fiat currency depreciation," but the vehicles they choose are altcoins that lack fundamental value support and purely rely on narrative and liquidity drives. Over the past decade, the fate of the vast majority of altcoins has been to go to zero or near zero. The significance of this sample group is to remind us: while the direction of "escaping fiat currency" is rational, the choice of "where to escape to" is equally crucial. Not all "non-fiat assets" inherently possess value-preserving attributes; the asset's scarcity, consensus strength, and real demand are the core determinants of whether it can withstand cycles.

The Most Honest Signal: What Are Central Banks Buying?

Here is an observation angle that can almost be described as a "dimensionality reduction attack": you do not need to believe any analyst or any research report; you only need to look at what central banks have done with their balance sheets over the past few years.

Global central banks' official foreign exchange reserve management institutions have been continuously increasing their gold reserves at a historically unprecedented scale over the past few years. According to a report by the World Gold Council, gold prices are expected to break historical records multiple times in 2025, and the total amount of gold purchased by global central banks has also reached a remarkably significant scale.

This phenomenon itself is more persuasive than any theoretical deduction; central banks are not unaware of the inherent flaws of fiat currency in the "storage" function; they know better than anyone. They simply do not have, nor do they need, to communicate this understanding to every ordinary depositor.

From Plummeting to Asset Accumulation: How Crypto Promises

In the practice of the crypto world over the past few years, we can also see this evolutionary path. Taking cashback from U cards as an example, most projects promise users high cashback ratios while concealing the ultimate fate of tokens and their inevitable plummet:

Fiat / Stablecoin Cashback: Consumption → Spending fiat → Remaining fiat sits in the account, depreciating instead of appreciating. Every time you consume, you invisibly allow your savings base to continue to be eroded by inflation; you have not "earned" anything, just completed a pure value consumption.

Token Cashback: Consumption → Spending stablecoins → Merchants or platforms return altcoins as "rewards." This model superficially introduces a "cashback" incentive structure, but if the returned assets themselves lack real scarcity and demand support, this "cashback" is highly likely to be diluted to zero over time, essentially just a repackaged value loss.

However, RWA and tokenized U.S. stocks provide another option for crypto. For example, if we adopt an asset-backed cashback approach, returning to users real hard assets with long-term value support can bind users to the accumulation of valuable assets.

This is the final conclusion that this article aims to argue, and it is the only application scenario it seeks to realize: we cannot change the central bank's process of setting a 2% inflation target, nor can we change the fact that this promise is not guaranteed. But what we can completely change is what assets will catch it when fiat currency flows out of our hands at that moment. This may be the simplest yet most effective way for ordinary people to respond in this ongoing "2% game" that has lasted over thirty years, with no signs of stopping.

Appendix: Data List

1. The inflation target range initially set by New Zealand's Reserve Bank Act in 1989 (0-2% or otherwise), source: RBNZ official historical documents.
2. The original text link and annual revision comparison of the Federal Reserve's 2012 statement, source: federalreserve.gov.
3. The original text of the joint statement by the Bank of Japan in 2013, source: boj.or.jp.
4. The original text of the European Central Bank's 2021 strategic assessment, source: ecb.europa.eu.
5. Precise numerical verification of 2% inflation compounded over 10 years / 35 years.
6. Annual data and peak values of actual inflation rates in the U.S. and Eurozone over the past decade (e.g., 2022 CPI peak), source: BLS, Eurostat/ECB.
7. The precise depreciation rates of the yen, Turkish lira, Argentine peso, and Nigerian naira over the past decade, source: IMF, various central banks, BIS.
8. The precise growth rates of BTC/NVDA/TSLA/GOOGL/S&P 500/gold over the past decade, source: TradingView, Macrotrends, NASDAQ official, Yahoo Finance.
9. The precise numbers and statistical criteria for the World Gold Council's 2025 "53 historical highs" and "central bank gold purchases exceeding 5000 tons"—source: World Gold Council Gold Demand Trends report.