For more than 3 generations, America has enjoyed economic dominance due to the World Reserve Currency being the US Dollar. The dollar is accepted across most of the trading world and is favored in international trading.
This was evident by the end of WW I because of the gold standard and the US Lending polices during the war. Lending gold to the victors. Then these debts were called in and few could pay those debts. Then, we had another war and another, and another.
In 1971 President Nixon took us off the gold standard because the US dollar had became more and more inflated and suffered a tremendous loss in value. Printed dollars outpaced the actual reserves and many foreign countries brought their printed US dollars back to the US and traded it in for gold ( fearing this loss of value in the paper money they held). This gold rush and depleted gold reserves was the main reason the US moved from the Gold Standard to a Fiat standard. Backed by the full faith in the US Government.
Now , the goverment could print all the money they wanted without fiscal restraints. Inflation was not recognized by the general US population, or maybe it was ignored.
The majority of the rest of the countries in the world then moved to to this same Fiat Standard.
And then comes Satoshi Nakamoto. The father of BitCoin.
In the early days of printed currency, the merchants and banks wielded power as they controlled the money supplies and also the security of that money. In modern day times, the governments control the money and thereby the money supply.
So, Rather than supply and demand controlling the exchange rates and inflation, the government ( Read Federal Reserve Bank) will manipulate these rates and the Treasury will print money as the political winds dictate. Remember, the printed money we see is less than 14% of the total money on the US ledger. The rest exists as a ledger entry on a digital ledger.
I write this as a precursor to what you need to recognize when Crypto Currency is compared to the Fiat Monies we now use. Both crypto and Fiat are digital assests that exist on a digital ledger. The printed money (money in circulation) is a small portion of the money represented of the total amount of the US dollar declared on that digital ledger.
As we have already adopted digital money in the form of checks, credit cards, PayPal, Apple Pay,Western Union, Money orders, etc, how hard will it be to adopt a digital form of value that can be stored and traded just like your dollar bills?
My opinion of this conundrum of new forms of money, inflation and reduced value of your dollar is to look into the near future and see that the dollar will exist alongside Crypto. We as Americans are used to one money and one language. When you expand your knowledge and travels, you see multiple currencies in common use along side multiple languages.
And , really. Watch the video. You will be informed and suprised as to how history seems to repeat itself. My thanks to the Texas Blockchain Council for producing a great lesson.
Comments are always accepted. you can ping me via this page, or @electric220 on Twitter. This venue gracefully hosts my opinons, but are mine and mine alone.
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