Purchasing Power Index is one of the widely used statistical indicator to measure the health of national economies. The same concept is now being introduced to bitcoin economy by Bitbond. Bitbond is a global P2P bitcoin lending platform based out Germany. The company has applied the well-known Big Mac Index to measure the bitcoin purchasing power.
Big Mac Index is a tasty name for an economic theory that was coined by the Economist almost three decades ago. The Big Mac index is used to measure the purchasing power parity by comparing the price of any single product in different countries. Even though the Big Mac Index has its own shortcomings, it is still being used for calculating the Purchasing Power Index due to the ease of understanding and relating to it.
The BitcoinPPI for bitcoin shows that one bitcoin can buy about 100 Big Mac hamburgers and Bitbond is creating a platform to list many such comparison. Bitcoinppi.com seems to be more of a fun project for the guys at Bitbond. Led by the CEO and Founder of Bitbond Radoslav Albrecht, the company intends to make a list of all the things that can be bought with one bitcoin.
The project however has its own advantage too. It will serve as an important data point and may also promote the use of bitcoin by showcasing the value of bitcoin.
Until now the value of bitcoin has been calculated using bitcoin-fiat currency pairs. With bitcoinppi.com, a more accurate representation will be possible. bitcoinppi.com comes with API support which can be used by other developers to build applications over it. The API and codes are already made available on GitHub.
Source: Crowdfund Insider (Img: www.mattbussey.com)