I will send you crypto investors leads– Small Package

I will send you crypto investors leads– Small Package

Our smaller version of the crypto investors package contains 350000 leads and is meant as a more affordable option over our large package which can be viewed HERE. This is a large collection of consumers that have purchased cryptocurrencies through wallets or exchanges. We acquire these leads in bulk from third-party sites. These lists are tested for responsiveness and offer great value for your marketing campaign. These lists are MADE TO ORDER and take 24 hours for the link to be sent. This ensures everyone gets a different list.
Though looking at qualitative aspects two situations are there –

If Bitcoins would gain consumer confidence and their velocity of transactions increase rapidly then indeed the consumer demand would increase.
In crude form,
Money Supply Of Bitcoins (MS)=

No. Of Bitcoins (M) × Velocity of Bitcoin transaction (V)

Where velocity of Bitcoins means how much a single bitcoin is transacted in a period cycle.

Thus money supply would increase owing to an increase in velocity owing to high consumer confidence thus leading to higher consumer demand and subsequently inflation.

But people would be switching from domestic currency to Bitcoins, thus similar analysis shall apply for domestic currencies, thus it would result in a lower velocity of transaction for a single dollar bill. This would reduce the money supply of domestic currency and therefore would lead to falling in consumer demand made in domestic currency.

Till now looking at Consumer demand overall, it would not result in higher inflation as the money supply measured in terms of domestic currency and Bitcoins would remain the same. Thus consumer spending should not increase.

Now if the huge capital gain is made in Bitcoins resulting in an increase in wealth for sustained periods then it would lead to two effects-

The increase in Bitcoin money supply is measured in nominal terms measured in dollars.
As mentioned above MS of Bitcoins = M × V, but if we measure it in terms of dollars, then

Nominal MS of Bitcoins = M × V × Current Price of a Bitcoin

= M × V × 10,500 $/Ƀ (Current Price)

Now it’s important to look at the effect on the Price index of goods. Bitcoins as a medium of exchange caters to a specific section for payment of online services. If we have a price index for such a section of commodities (which I am unaware of right now) then divide the above equation by the new price level of the index,  getting the real money supply of Bitcoins.

I intuitively believe that such capital gain in Bitcoin would increase the real value of the money supply of Bitcoins but for a short to even medium term. Pricing of online services is actually done in dollar value, thus if Bitcoin becomes valuable then the actual price Stated in Bitcoin may fall while the same price stated in dollars would rise. Thus I am assuming here that the pricing of online services is done based on the dollar money supply.

2) Wealth effect would apply if the Bitcoin value rises and also stabilizes. The volatility in Bitcoin right now may actually make consumers cautious, but if it stabilizes more than any value addition in Bitcoin value like done by any other investment in wealth would actually increase consumer spending leading to inflation.

I have made a lot of assumptions, any comment regarding them or to improve upon would be welcomed.