edilmedeiros on Nostr: Gold was an excellent money, it can hold value across time and space. But it has a ...
Gold was an excellent money, it can hold value across time and space.
But it has a fatal flaw: holding value a cross scale was difficult. Indeed, this is a problem with all physical commodities.
If it is highly valuable, small value transactions that constitute the day to day routine of most people are hard to make. If it has low value, large scale transactions suffer and add friction to specialization and economic development.
We solved this problem long ago with banks and gold certificates. But it was too easy for governments to corrupt the system and the people lost control of their money.
Which is unfortunate, fiat looks convenient for small scale transactions, but it is made a hassle for large scale. It is not transferable across borders, and it doesn't hold value across time.
It doesn't work for savers and innovators. It barely works for short term thinking people that conform to the norm. It only works to keep people under control.
That's why it won't last forever.
But it has a fatal flaw: holding value a cross scale was difficult. Indeed, this is a problem with all physical commodities.
If it is highly valuable, small value transactions that constitute the day to day routine of most people are hard to make. If it has low value, large scale transactions suffer and add friction to specialization and economic development.
We solved this problem long ago with banks and gold certificates. But it was too easy for governments to corrupt the system and the people lost control of their money.
Which is unfortunate, fiat looks convenient for small scale transactions, but it is made a hassle for large scale. It is not transferable across borders, and it doesn't hold value across time.
It doesn't work for savers and innovators. It barely works for short term thinking people that conform to the norm. It only works to keep people under control.
That's why it won't last forever.