History of money: From fiat to crypto, explained By Cointelegraph
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Money has a long history, from bartering to digital currencies. Many currencies worldwide are no longer tied to a physical commodity or a reserve of the commodity. Instead, they are backed by the government’s ability to manage the economy and control inflation via fiat currencies. The value of fiat currencies today derives no longer from their scarcity but from individuals’ trust in central authorities minting the money.
Ever since the abolishment of the gold standard, it became clear that the value and stability of fiat money can be hurt by inflation and other factors, including loose monetary and fiscal policy, bad management practices and gross institutional decay. Arguably, the future of money is closely tied to the future of political institutions. The state and central banks will continuously seek to play a crucial role in creating and regulating money.
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Money has a long history, from bartering to digital currencies. Many currencies worldwide are no longer tied to a physical commodity or a reserve of the commodity. Instead, they are backed by the government’s ability to manage the economy and control inflation via fiat currencies. The value of fiat currencies today derives no longer from their scarcity but from individuals’ trust in central authorities minting the money.
Ever since the abolishment of the gold standard, it became clear that the value and stability of fiat money can be hurt by inflation and other factors, including loose monetary and fiscal policy, bad management practices and gross institutional decay. Arguably, the future of money is closely tied to the future of political institutions. The state and central banks will continuously seek to play a crucial role in creating and regulating money.
Continue Reading on Coin Telegraph
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