Bitcoin Forum

See:

There Is No Escaping History.  Fiat Currency Eventually Fails (https://www.zerohedge.com/news/2018-04-02/there-no-escaping-history-fiat-currency-eventually-fails).

Notice that this is a critique of fiat money -- not a critique of state-issued money under a gold/silver or other standard.  Fiat money is a rare occurrence in modern history.  (We live in strange times!)  As we can see, the examples found by the author are a small number of short periods here and there.

I have my own critique of gold/silver standards, but that's another issue.

The problem is that now all the money issued by countries is fiat after the United States went out of the gold standard in 1971 which means that if the main fiat currency around the world the dollar were to collapse that could in theory collapse the entire economy of the world.

Very interesting article and by the sounds of things we may be heading for
some trouble id the US keeps the printing presses moving.

I dont know enough of economics but these recent 'trade war' rumours
could have an effect on the world economy.

What will be the result of over printing the $ and a trade war be?

Hyperinflation, you'd get a venezualian situation or post WW1 Germany. Its food stamps and no jobs when that happens. But in context of Bitcoin, will likely do very fucking well.

In my opinion As long as fiat money still serves as a medium of exchange, it will always be needed by the people of today and therefore it will always have a function as an asset to all of us. although the best value-keeping asset is gold but even though gold is quite liquid, it is no longer money that serves as an intermediary.

I agree that this whole stuff withis paper money is complicated since there can be printed unlimited paper's of money and eventually it will become worthless same as the articles shows what happened with silver and iron coins. I think something digital is going to replace paper money and that is going to happen very soon from my opinion, probably in until 2050 paper money should be replaced. It is going toto be a very complicated process since there are so much paper money in the whole world but I think slowly people are going to get used with it because that is the future. Everything progresses in time, cars,technology,medicine and the same thing will happen with paper money, at a certain moment they will disappear

"Paper money eventually returns to its intrinsic value: zero" -Voltaire

Maybe Voltaire was right in a sense, but as I see if we relate it with the Cryptocurrencies itself that currently backed by a dollar market capitalization it's hard to believe that it would return to nothing nonetheless something we don't expect will occur in the future that will make it useless. IMO this eventually may happen if there would be an another World War as the modern technologies will surely wipe out the existence of mankind and when that time comes those survivors will all be nature dependent and the value of each FIAT money will be 'zero'.

That is a great read. Exactly the type of publicity and information crypto currencies need publicized in order to justify their value. I hope that piece counts as zerohedge publishing a pro crypto article, as their reputation for being anti-crypto has always appeared most undeserved to me. I've always liked ZH as one of the few financial and economics commentaries with something resembling an independent and reliable slant to its content.

Great history lesson there. I never realized the history of fiat currencies was so shady. I knew about zimbabwe and germany's hyperinflationary issues but had no clue there was a history and strong precedent for printed money being prone towards that end result. There is an error there about the federal reserve being "government controlled" it is in fact owned and controlled by the private sector, probably by bankers.

Other than that, it is possible that everything in that article should be standard curriculum taught in classrooms but is being repressed or censored to some degree. Its difficult to prevent history from repeating itself, when people remain unaware of historical precedents.

The article stated that fiat currency always decrease everytime. Maybe in a couple of decades or in a century. The value of money depends upon the gold and it is a fact that countries all over the world is backed up by dollar in order for their currency to have value. Since we have a scarce resources in gold, paper money will also lessen its value time by time.
I don't what will be the next if fiat currency will totally lose its value and weaken the economy but probably, it will lead im hyperinflation where the value of fiat becomes null.

Bitcoin is not competing with paper money. But with money controlled by central banks. This is the main discussion that can end Bitcoin or make it the main means of store of value or for monetary exchanges. Governments may decide to end paper money, but keep as the only accepted currency in a country for government negotiations, tax and fines payments, digital money. Bitcoin is more them any kind of digital money.

I mean let's face it, it's easier to handle money electronically than with papers in the hand. And if we compare fiat on the bank account and the blockchain money guesses who have the advantage...well not quite yet, but the potential for the blockchain is huge.

Yes, most currencies are explicitly, softly, and/or unofficially pegged to the dollar.  This is because the world system ensures (in effect) that every financial system is weaker than the US system.  (And yes, that includes the euro!)  The pegging is done by by non-US elites because it helps create confidence in the currencies they issue.

But, when the dollar is in real trouble, there is no inherent reason why these currencies can't stand on their own, if their countries can keep inflation in check.

Another thing to remember is that currency collapse is not the same as economic collapse.  The 1923 Weimar hyperinflation completely destroyed the German currency, but the economy was back to normal as soon as a new stable currency was issued before 1924.  Yes, there were big winners and losers, and it was not good, especially to those who kept believing in the paper money and kept most of their savings in it, and were too old to work after the stabilization, but it was not the end of the world for the economy or the country as a whole.  (Hitler's rise came only later, after 1931, during the Great Depression, which was a deflationary problem.)

The Fiat dollar has little inflation, only a couple of percent per year. Cryptocurrency for the year may show inflation 50-90%. Because they're not secured by anything other than the dollar.

Hmm.. Pretty interesting article you have here man, would be hard to admit for some but what this article says is somewhat true in a sense. Clearly, the past has already spoken a lot about fiat and how it can become through the years. Honestly, this has happened so many times that it is actually pretty scary. But still, we humans have the greatest power in the world which is to learn and improve, and in this case, after all the same mistakes, I think by now there would be enough knowledge to prevent this from happening again. If not, then I really think that we should find other ways.

At one time, our money was backed by the tangible value of gold or other precious metals, legal tender for anything of equal value.That is not the case any longer. The value of a dollar bill these days is what the government says it is. This arbitrary value is dependent on the whim of the government. And the government can print money like a copy machine run amok. There are no limits to how much money can be put into circulation. That is because this money isn’t backed by any real value

We're speaking of long-term issues here, so the trade war, or even the Fed's 'quantitative easing' are uncertain as to their effects.

The main long-term issue is that, all the incentives are for the elites to maximize the printing of money, and it eventually destroys or at least devalues their money.

And even having inflationary national currencies, even having the central banks printing money with not much background, we still "need" a crash now and then to equalize the markets. And this is the system that is considered good, working and established, while they call crypto a scam and a bubble.
Yep, the world is upside down....

if the fiat currency better for transaction tool, while gold is better for investment and not suitable for transactions. fiat currency the longer the inflation value the higher so it is only suitable for transact meet the needs of everyday life

I don't know that much but this thread does have some solid ground. Fiat does have an impending
tendency to fail and deflate and all commodities suffer because of it. It's different in crypto, deflation
is quite expected since dips do open up opportunities in an unlikely manner. In some nations when
dollars increase it's greatly affects the products locally and internationally. It's complicated indeed
and when you try to find answers, you will be buried with stacks of rhetorical words and terms. The
US dollar is quite influential in some nations, as well as with crypto. Fiat may be failing in many ways
but it is still a necessity in the economy. If it's falling, we are in a world of trouble after all.

I understand about the result of hyperinflation with the overprinting of money, but how would a trade war spur hyperinflation too?  Is it because of the fact that you have more goods staying in the nation and not enough goods being sold on top of the over printing of money?  Is there something else that I'm not really thinking of here?

Exactly... I'm so tired of being told by friends and family members saying that cryptocurrencies are obviously some sort of scam and will eventually be "hacked" or something else stupid like that when not understanding the fundamental properities of Bitcoin or "blockchain" in general.  Yet, they are so quick to defend the system that we are currently using when not even knowing why or better yet how the federal reserve works the way it does, because no one really does...

I mean, it's literally like 10-12 old white people in suits single handedly controlling the nations money supply... what could go wrong?

Have a lot of factors affect to Fiat Currency, not at all case fiat fail, but if your country economics not strong - your currency will cope up with flation, so everybody think they fails, they only talk about hyperinflation - don't talk what the reason make this situation. As for me currency is number which present for how asset we own :).

but it seem to fiat currency printing should have a basis, and can not print as desired, because eventually there will be inflation. but for the long term i think fiat money making prices are not appropriate

Very interesting informative ( Article ) and for me, the era of FIAT will end and disappear after a  few years, As well,  with the  presence of bitcoin, it has led to a decrease in  the value of FIAT ( Euro , Dollars ..) and however, due to the decline in the value of gold/silver  , there have been some  economic losses.
On the other hand, the financial transaction ( crypto)  through the internet and it  has become a great value in this period, and has many advantages like (Some facilities,  low fees..) , that's why  many people are using digital currency instead of FIAT .
 

There was global financial meltdown in 2008. The US was severely hit and the company I worked for then collapsed as management couldn't raise enough dollar to pay its staff back home in Africa. That experience makes me always laugh whenever I read fear and panic into people's posts here once there is a dip in bitcoin price level. I have come to realise (within my few years on earth) that anything used as means of payment once in a while gets to crash and lose value. The dollar, euro or bitcoin isn't exempted from this.

The Central banks made a laughing stock of themselves post the 2008 meltdown. Revelations regarding the nexus between mortgage companies, insurers, investment banks and the regulator should be enough for anyone to never dare to trust them anymore.

What the article says may very well be true. Their is a resurgent China which is making things difficult for US and other Western countries. The US/ West cannot cut down on their expenses without risking the scenario of a Russia/ China dominance or being seen as weak in the wake of of Jihadist terrorism. This brings us to a situation where they need to print more and spend more. This is very similar to the examples given in the article.

If this does happen, it'll be a painful and long process. In today's connected world, we don't want this to happen. If a decision has to be taken on replacing the reserve currency, can it be taken without hurting world stability? I don't think it's possible for such a thing to happen in a non-violent, prudent decision kind of way.

Imo it's just the natural progression of humanity sir.
In the past we still can use gold/silver or paper money backed by gold because the money can still keep up with the demand (or mainly because population).
And when money cannot keep up, it became fiat to make sure people still can get enough money even when its intrinsic value decreased.
This is to prevent chaos and ensure order.
Surely fiat currency will eventually fail, but i don't see any solution for that issue.. maybe cryptocurrency?

The advantage of electronic money is the major reason that bitcoin and digital currency have not been dismissed or jettison. The usage of electronic money helps in the understanding, usage and near adoption of cryptocurrency. It would have been a total failure if there was nothing like electronic money in the first place. This is why we still hear of bitcoin and altcoins, otherwise, it would have been long forgotten to the anals of history.

It is also important in our country that now the economy is moving through fiat money and the paper money is available all the time and it is true that fiat will not always but just like currencies market some time a great pressure arise from some forces due to which the prices become down and fiat is normally going on and for us the bitcoin is the crypto investment opportunity and hope full that future will more shine than now.

The Central Banks never necessarily caused the housing market crisis, but rather it was the "too big to fail" banks that did.  They lended out money like crazy in "subprime mortgages" that were pretty much guaranteed to fail, but the banks wanted to sell as many as they could and irresponsibly make people enclosed in debt with no end in sight.

Sure, Central Banks do other irresponsible stuff, but that has to do more with the money supply, not necessarily loans to everyday normal people.

What was the embarrassing part was the reaction the government had and bailed out the greedy CEO fucks at the "too big to fail" banks because they deemed them too crucial to the economy to let them fail... "free markets" my ass.

You using your debit card and transferring money for beer to a friend using Venmo isn't the same the same as "digital cash" though..  For one thing you have to trust a third party to be able to verify your funds.  Using cash you can verify someone paid you and that you have the money by looking down in your hand and seeing that you are physically holding cash. 

The great part about Bitcoin is that it has both the benefits of being digital and also having no third party needed to verify that you are holding cash in your "wallet".

You're right about the "too big to fail" banks. I feel the central bank was complicit in this because they are supposed to be the regulator right?

The bubble that was forming due to all those mortgage derivative bonds couldn't have escaped the attention of the regulator/ watchdogs. They just chose to look the other way while credit rating agencies stamped them as AAA. Though most reports absolve them of all blame, pointing on the lack of focussed oversight, it still is hard/ naive to believe that the officials involved were completely clueless. There is a good documentary by Michael Moore on this.

And absolutely yes, the bail-outs for all these millionaire CEOs and the increase in their payouts was just a "Fuck You" to the common people I guess.

We're living in weird times indeed. Probably the first time in history that the entire world is completely off the gold or silver standard or any form of "real money" and fiat currency is the norm everywhere.

Fiat currency has never survived, because it is issued by some central entity. If that central entity decides to abuse its powers to finance something by inflating the monetary supply, or if that central entity just completely collapses, the paper would be completely worthless. Intrinsically, it's worth nothing.

You'd be naive to think that this stability stemming from a debt based fiat system can last long. That's the main reason why I invest in bitcoin as well, as a hedge against fiat currencies. People don't realise it now because they think fiat holds intrinsic value, but in reality, fiat always loses value in the long run, and goes to 0. Even promissory notes that promise to pay you something can be abused through fractional reserve, unless bitcoin, which cannot.

I believe there are highs and lows for most things , human and currency inclusive. Currencies of the world falls from time. So when cryptocurrency or bitcoin falls in price, I don't panic, I just know it is going to regain.

I think that a long as fiat still serves of exchange it will be usual need to people today and therefore it will have functions as an asset to all of us.

Oh yeah, I'm pretty sure there are ways you can pass the blame around to all banking and even governmental entities about what happened during 2008, but it just kills me that the actual people who decided to make those terrible business decisions, whether it was morally right or wrong, wasn't allowed to fail as a business due to those bad decisions.  I can't stand when we boast that we are a free capitalistic society that allows freedom to achieve whatever we want when we don't allow businesses who bad deals are allowed to be saved and the same CEO's remain on top for the "good of the people".

Fiat currency does not always fail. I disagree with you in this regard. Fiat currency is actually the backbone of the current market system and every country around the world has printed a huge amount of fiat currency or paper money backed by gold. Only the inflation in general and hyperinflation in particular in Venezuela in the last years pose a threat to the demand of the paper currency.

the name of the times change is always changing. because the leadership of a country is also changing, and they have their own thinking.

To be honest, I don't predict hyperinflation...  That tends to happen to countries that have been pushed to the brink by the global imperial elites, because the elites want to make an example of a rebelling government, in the case of today's Venezuela, or because they wanted to suppress a non-friendly rising power, in the case of 1920s Germany.

What tends to happen in the West, when the system fails, is a more orderly surrender to reality by the elites.  There's usually a (de-facto) devaluation of state-issued money against non-state money like gold (and now probably Bitcoin as well.)  Some inflation will be part of the mix, but nowhere near the craziness of hyperinflation.

The elites have to make the retreat orderly, in order to maintain what remains of trust in their money system.

Either way, everyone should hold a portion of their savings in non-state money.

In my country fiat does not always fail infact it is the backbone of our survival though it is not always at its highest value all the time and will not pump up as high as bitcoin which double or triple or more in a short span of time. Digital money is now very common especially to elite people but to us ordinary citizens fiat is our main currency. However, having cryptocurrency like bitcoin helped us surpassed from being ordinary.

Inflation isnt entirely bad. Capitalism needs to grow and right now that's the only way. Of course there are questions of sustainability. How long will this become sustainable? and it there a ceiling to continuous growth? I dont completely agree that fiat eventually fails. The truth is fiat fails because of greed and mismanagement.

Fiat currencies never lasts, you don't see fiat from even just 100 years ago ending up still in circulation with the same value.

A lot of people blindly trust in the government and their ability to maintain the value of their fiat currency. The fact is that it never happens. Fiat currency always depreciates in value over time without any exception because of the fact that governments can do whatever they want to issue more of it.

Investing some of your portfolio into BTC/other inflation hedges is the way to go imo for the long run.

Get as much money out of fiat as you can, while you can.

Nothing lasts forever and fiat does not escape this law. With the world advancing so much technologically and making so much advancement, there will be no room for fiat money as everything will be done electronically.

There are all kinds of rules regarding money printing.  In Britain and the US there were laws against printing money beyond a certain ratio to gold reserves.

But all these fail to stop over-printing, because the incentives are for the elites to print more, and they always find a way around the rules.  (E.g. a night at the Waldorf Astoria in New York was advertised for $5 in the 1930s.  Now it's probably closer to $500.)

True, but only a small portion of your savings needs to serve as a medium of exchange.  Most of it needs to be a store of value.

Problem is now that all money issued by countries is fiat, after US went out of gold standard some years before.

Oh, ZeroHedge again, the messenger of eternal doom and gloom.


Didn't read past these first two sentences as it is pretty much clear that they don't know what they are talking about. In simple terms, the author of that piece, whoever he might be, is putting the cart before the horse. It may in fact look like paper money leads to a collapse of almost every economy but in reality it is always the other way round. Whatever case you consider, the failure of paper money is the outcome of the failure of the state, not its cause. The Weimar Republic, Yugoslavia, Soviet Union, Zimbabwe, you name it, it was all a failure or breakdown of the state which quickly led to a collapse of the monetary system.

As a matter of fact, you cannot live without using fiat currency because all countries are using it, and even if you have bitcoin, you eventually will transfer it into fiat money. I am not saying it because I support it, but we have to be realistic and honest with this reality.

You cannot live without fiat money, and there is no fiat money without bitcoin. You just need to have some coins in order to have fiat money.

What are you saying?

Bitcoin can exist without fiat currency. Only reason why people are trading fiat with bitcoin is because bitcoin is not yet completely mainstream. The discussion here is about the depreciative nature of fiat, and how they always end up being valueless. I completely agree with that, as you simply can't find any successful fiat currencies at holding value for the long term.

Bitcoin/gold/silver/other decentralised currencies can not only exist without fiat, it can also hold its value in the long term.

We know that flat will fall in the end but that is how the world works now, government start to print more paper money everywhere and issue long term bond which create more debt in order to survive or try to develop to a bigger country. The economic recession already crashed a few times and its not that government can't stop it but because there is no alternative to do it.

I am absolutely agree, whole stuff of paper money is complicated since there is can be printed unlimited paper money in the world..

In my view, Bitcoin can exist along with fiat but it can't exist instead of fiat. Such a question has been raised numerous times here, and many distinguished posters, with whom I certainly agree, pointed out that if Bitcoin were to substitute fiat, if purely hypothetically, the economy would quickly come to a halt and then implode. To sun it up, Bitcoin as well as other cryptocurrencies is a bad means of exchange, but this is what makes money into money. 

No doubt and once people realize the system is no good, they switch over to a new "fairer" system. It all ends up being the same anyhow, this is the first time in 500 years+ we have seen a real shift to another type of currency. I don't know what lay ahead, but I am excited to find out and be on the forefront of history.

That is the story told time and again by mainstream economists.  Remember these are the same people who told us the gold standard was good economics, until the elites in all countries were forced to default on gold, and then they told us gold was bad.

It's not that money must be 'flexible-supply' to keep up with growing economies.  It's the other way round.  A growing economy (from modern technological advance, etc.) enables the elites to skim off the cream of production by manipulating money.  No wonder, the economists tell us money must be flexible!

The deflationary fear is only justified by the bad experience of deflationary pain (e.g. the Great Depression, etc.)  But all such bad deflation in history has been preceded by a financial bust, which has been caused by elite-driven financial inflation and state-supported over-valuation of assets, anyway.

There can't be honesty in a system where voters don't understand enough (about money and finance) to hold the elites accountable.  It's not possible that central bankers and economists actually use policies for the good of society, because of this asymmetry of information.  If the elites didn't use the money system to receive unearned wealth and power, they'd be short-changing themselves, in a totally objective, morality-free sense.

IMO the problem is with incentives.  The fiat money system has incentives for the elites to destabilize their own system, by issuing more money and debt to benefit themselves.  This eventually destroys the value of, and trust in, their issuance.

'Capitalism' is usually taken to mean unfettered, free markets.  But the state issuance of money is the height of state control.  Money can't find its value in the marketplace because the elites carefully manipulate money's price to operate and ensure the survival of a system that primarily benefits them.

I don't think the system has the problem here, because if you have to look on the manipulations of the elites really helped to make the operation stable. Fiat currency is going to survive for more 100 years and people really have to recognize it as a sustainable currency. Unlike with crypto currency, the assurance is nothing to prove for due to its volatile movement and crashing always happened. Moreover we should understand that fiat currency money doesn't gain huge interests, but still the stability always in parallel to the regulations of a certain country.

I might have to re-read that article, but the relationship between the state and its money seems more of a  chick-and-egg (in both directions) than a horse-and-cart case.

Confidence in state money depends on confidence in its state, true.  But confidence in the state also depends on confidence in its money.  The British Empire (and the Dutch and Spanish before it) were brought down by the incentives for the elites to issue too much paper money (even though this 'money' was technically debt payable in gold or silver.)  Savers and investors moved money to the rising US after World War I, and Britain lost the empire and endured economic pain over decades of the 20th century.  (The war was only the last straw that broke the camel's back -- since Britain had only 3% of the gold required to redeem its total issue of paper sterling under an official gold standard, we have to view paper sterling as a bubble that was simply not possible to sustain long-term, with or without a war.)

The French Revolution issued the Assignot, and the American Revolution issued the Continental, both of which collapsed due to their paper nature, not to the failure of the revolutionary governments.  Even Weimar Germany held together well after the hyperinflation.  With a new land-backed currency, the money system and the state were back in health in a few months.

I would agree that in many cases, failing states and/or bad policies lead to hyperinflation and collapse of the currency.  But these aren't the only examples of paper money.  The most recently strongest paper money is the dollar.  Yet its purchasing power today is on the order of 1% of what it was at the founding of the Federal Reserve in 1913.  If it has 'not collapsed' yet, it is because of bubble dynamics alone.

As we have seen with the Spanish, Dutch, British, and now American money bubbles, state supported bubbles might last a long time (and maybe much longer than outfits like ZeroHedge predict!) but the nature of bubbles is to burst -- no exceptions.

IMO money must primarily be a store of value.  It is a means of exchange only because it is a good store of value, as no one would take a money in exchange for goods if that money isn't perceived to keep value.

Bitcoin can't be a good means of exchange because the blockchain architecture, by its trust-free nature, has too much overhead to be used in everyday transactions.  But it's this very trust-free nature that enables it to be a store of value.  A world one can envision is where savers hold most of their wealth in Bitcoin, but continuously convert a small portion to/from state currencies for spending.

This is not essentially different from the (wise) strategy of holding most of your coins in a private wallet, but keeping a small portion on an exchange for trading.  The exchange requires you to trust a central authority, but is more convenient.

BTW, by distinguished posters, do you mean all the top economists who used to praise the gold standard when the elites were in favor of it? :)  I would agree that the economy would implode if we somehow, magically transition quickly to a hard money.  But this is only because prices and production levels have been distorted by the modern fiat money inflationary system.  Thus, keeping this system going, because we're afraid of the pain of stopping, fits a classic definition of addiction.

A fiat currency system comes into existence as a result of excessive debt and the resulting hyperinflation.When the government is unable to repay all its debt in a physical form gold or silver then the idea arises to remove the physical backing.This is when the fiat money system is implemented and is one in which the value of money is based on confidence.

Looking at economic history one can see that different societies from different parts of the world during different times has been swinging from quality money (gold, silver) to paper money. Today we have Bitcoin and other crypto currencies that one can choose from.

As an Austrian I would like to make the proposition of free money, that is let the market (in other words us) decide what we want to use. If someone want to use Bitcoin that is great, gold, silver - be my guest. If someone want to use paper why not? But don't force anyone... with that said Fiat always fail!  : ;D :D

Btw Very interesting thread and great opinions.

The difference between fiat and natural money, as I see it, is like the difference between natural and artificial medication.

It has come out that the US government knew 20 years ago that marijuana (as a natural pain killer) is harmless, but it's only now that it's forced to slowly legalize it.  The powers-that-be prefer us to use artificial drugs (or money,) because there's no way to profit much from the natural.

If there are side effects and addictions due to the artificial stuff, it benefits the elites who can then put their power to good use by allowing this and regulating that.  One way or another, their power will become valuable and they can profit from it.

Agree but still, it has grown at a level where I don't see that people leaving it at least in next 100 years. There will be the people who will keep using fiat currency irrespective of the advantages of other payment systems including blockchain based currencies. The biggest problem with fiat currencies is that there is a centralized power that controls it and it doesn't have any sense of freedom, to be honest. On the other hand, the banking system is soaking all the benefits of the real value of money.

Indeed, we shouldn't exclude from consideration the cases when a government is made up of criminals who just use their power (this is to the question of the value of power) to steal the nation's wealth. I remember a few years ago some African ruler ran away with the treasury of his country, something like 9 million dollars all in all, if I'm not mistaken. Obviously, I didn't mention these cases as they seem to be self-evident. I'm talking specifically about the cases when government doesn't want to kill their money unless they have no other choice left, like in a war or revolution.

I think fiat money value differ in every state since economic stability and government protocol differs as well including cultural values which is also another factor that affects economy. In my country fiat money does not always fails but like cryptocurrency it does increases and sometimes decreases too. However, the flactuation rate is not as high as bitcoin.

It might slightly differ per country, but the general picture is still the same. It's nothing more than a system that's based on debt and continuous creation of more fiat that's overflowing the economy with long term consequences.

The fluctuations of fiat currencies might not be as severe when you compare them in a direct face to face manner, but if you look further, fiat currencies experience crazy volatility as well, but no one talks about it.

I remember when I was buying stuff from the US (not crypto related) €1 was worth almost $1.40 per conversion, where last year, when purchasing Bitcoin, €1 bought me significantly less than $1.10 worth for a short while.

If these aren't insane fluctuations, then I don't know what is. Bitcoin goes through insane fluctuations in a quick fashion, while fiat does it over longer periods of time, which means that fundamentally, there is no real difference.

If there are recorded histories that paper money failed a country before but i think these are only few compared to the present day in which these countries that have mentioned are now one of the most powerful economies of today and these was they used money too. Germany, France, China and USA are now belongs to the most powerful nation in talking of military and economy therefore i will not be convince that these are failed countries because they just rely on money.

what exactly the author means by saying falling of fiat money? as i read the article it just simply changing the component of the physical money from 85%silver to iron and now paper money, but i dont not see any decrease of its value or purchasing power.. fiat money whatever its form is only have one important role in the economy and that is use to exchange goods and services...

if the author is worried about too much printing of physical money.. it could not happen because too much physical money  could hurt the economy and the country in general. it will only result to inflation...

read this article below.

https://www.americanbullion.com/what-actually-happens-when-a-government-prints-money/

The problem with fiat money is always printed by central bank and they reason is they want to boost growth. They dont care about inflation and peoples assets always reducing because that inflation, and thats why always crisis on our global economic

We all know that whatever happen people would prefer to convert their Bitcoin into Fiat currency, but the problem is, if we talk about the advantages of Fiat vs Bitcoin,  Bitcoin is more ahead than Fiat why? Bitcoin could use in many transaction we're in you can make several transaction without limitation and also it is good in trading cause you can make high profit in just a couple of months, that's are the factor why Fiat currency failed to go on top of the market nowadays.

I love what Ronald Reagan said on this.

https://i.imgur.com/0huMdzE.png

Politics are structured in a way which rewards politicians for selling out their own values and beliefs in favor of special interests who provide campaign funding and other monetary incentives. No matter which nation on earth we're discussing, its extremely common for the most successful politicians to be the ones willing to sellout the most and whore out themselves for anyone with money and an agenda. Its a race to the bottom and opposite of free markets, competition in politics breeds failure for everyone rather than positive rewards.

What may be needed is some form of restructuring. Removing the degree to which special interests are able to influence politicians with lobbyist incentives, greater safeguards and accountability. We've seen the trend be strongly in the opposite direction of the last x number of decades. The quality of legislation has greatly suffered as a result as we've seen standard of living, education, wages and other metrics fall substantially in recent times.

 I disagree with you in this regard. Fiat currency is actually the backbone of the current market system and every country around the world has printed a huge amount of fiat currency or paper money backed by gold. Only the inflation in general and hyperinflation in particular in Venezuela in the last years pose a threat to the demand of the paper currency.

From my perspective, when a currency token (a hard asset like gold or a value token like Bitcoin) is a good store of value, it will impede its application as a means of exchange since people will be incentivized to keep it instead of spending it. In other words, a small and predictable rate of currency inflation is sort of a must-have for a good means of exchange in order to prevent people from excessively hoarding it. Let them hoard deflationary assets like gold or Bitcoin instead (or whatever).


Even if it was perfect like instant and free of charge transactions with no price volatility, it would still remain a poor means of exchange due to its being too good as a store of value. It would be deflationary, and that would make the economy implode.


Actually, by "distinguished posters" I meant forum posters like Anonymint or whatever name he had been posting under then and a few other dudes here. I remember heated debates over this question a couple years ago. Or was it four years ago?

It’s  true that bitcoin is gaining a lot of popularity among the people throughout the world. But it does not mean that the fiat currency are failing. And still I do believe that fiat currency is better than bitcoin at this time because firstly, fiat currency has way more users than bitcoin all over the world. Then fiat currency has way more popularity among the people all over the world. People have a trust in fiat currency whereas there are only limited people who trust bitcoin.

Yes.Fiat currency is vulnerable to deflation as it is nowadays printed infinitely and not based on the volume of gold which they hold.A lso if the government suddenly wants to devalue the fiat currency by demonitising as it was done in India,fiat currency would just fail leaving its holders in a misery.

These fluctuations of less than 30% over a time span of a few years are nothing when compared with Bitcoin volatility where you can see that much in a matter of days a few dozen times within a single year (not even speaking about other cryptocurrencies). Honestly, I can't even imagine how you can call such fluctuations insane. In my view, they are nothing out of the ordinary, while insane is on order of thousands %% like price first grows 10 times, then falls 3 times all within a few months.

Inflation prone has proven the case of inflation due to too much money being printed by the government. Things that will lead to chaos and the fall of value of money, although still sells as a means of transaction. Of course, if this happens, the country will suffer enormous losses

Yups,fiat will always remain as medium for payments even in time that cryptocurrency took over the main stream,because for sure until that mentioned years of 100 there will still uses fiats for transactions internet wont be all over the world..thats one thing for sure

I don't think there is a way to change this for the long term. Of course, if some responsible, conscientious and dedicated guy comes to power, he can make some changes and improvements (though even his very rise to power seems highly unlikely on its own), but they won't last after he resigns from his office or just gets shot down like Kennedy. I want to say that what is done by one man can be undone by another, and any improvements will be temporarily only. Then they get dismantled, and everything  eventually comes back to where it should in fact be given the human nature. In other words, things you are talking about cannot be changed by issuing a decree or imposing safeguards. Humans need to be changed first.

Yes, but the elites taking a big cut of the fruits of labor is a relatively small part of the problem.

The bigger part is the use of geopolitical power to drive conflicts, terrorism and wars, as we're seeing today, in order to force governments and countries around the world to follow Western dictates, that is, do what is necessary to support the value of the fiat money issued by the West.  (Read a book such as 'The Confessions of An Economic Hit Man,' or 'War Is A Racket,' for example.)

That is probably why inflation in Western fiat money is slow and gentle, as you seem to imply.

Criminality is relative and varies by degree to a large extent.  Every money issuer is criminal to some extent, and the job of 'wise' Western elites is to ensure the outer-ring countries are always more criminal than those in the core.

In the best of these countries, the USA, the dollar has lost at least 95% of its purchasing power over the last 100 years.  So, yes, a fiat currency may not have totally failed yet, but it is only a matter of degree (and time -- since the key financial assets of past global empires like Spain, the Netherlands, and Britain have all been defaulted on.)

The inspiration for my post was that, through most of the modern age, state-issued money has been tied to gold or silver.  Totally 'fiat' money is a relatively rare occurrence, and when it did occur, it always failed miserably.

Today, we have the historically strange situation where the top-dog money in the world is totally 'fiat.'  Granted, the top-dog country still has a lot of power, but the history of totally 'fiat' money should serve as a warning that collapse might come faster and more violently than in the past.  (That is, all past top-dog countries issuing reserve currencies/debts have been brought down by that issuance, even though the issuance was backed by gold and silver: Spain, the Netherlands, and Britain.)

Yes, going to hard money now would make the economy implode, but how do you answer my point about distortion and addiction?

This is one of the key arguments by the establishment, and I'm afraid there is no truth to it.

The issue is never hard vs. soft money, whatever money we use, or whatever money might come out of innovation.  The real issue is always, who has the power to decide?  Who sets the price and value of assets?  When it's the state and not the free market, there will be big trouble.

The real trouble with state-issued money, and especially with state-issued fiat money, is that the central planners have the power.

It is in the interest of the establishment to manipulate all price levels to make it *appear* that their issued money has the most stable value.  This has been going on for about 500 years and is nothing new.  The gold and silver standards over the centuries were just very good versions of today's not-so-elegant manipulations.

But don't be deceived.  Hold on to your Bitcoin and gold despite all the ups and downs, and you'll be fine unless you're too old to see the long term.

You are completely correct, now the question should be, what we can do in order to protect ourselves when fiat currencies finally fail? And I think the solution is very easy we need to find a store of value, one of the most famous stores of value is gold and while I consider it to be a decent store of value in my opinion is not the best after all you cannot eat or do anything with your gold while if you invested in real estate then you can use that house and that terrain to live there for some time and if you have enough space you could even produce food there in the case things got really ugly.

Well ro hold it physically yes fiat is more hassle, but I think if there was no fiat it is impossible for us to come up with the digital money from using goods as our way of payment , we will never come into digital age, without step by step being in that period. I guess the fact Bitcoin is here already, let us keep the fiat for the unbeliever to used, there is no certwin competition for that if both sides were useful.

No, of course it's not Bitcoin that suggests fiat currencies fail.  History, and the perverse incentives built into state-issued money, suggest that.

"Humans need to be changed first." -- No.  The ultimate argument of the establishment, their final line of defense, after their deception has been exposed, is that humans are dishonest by nature, so if the system is dishonest, it only reflects their core nature.  If the system ever gets better by accident, human nature will reverse the progress anyway.

The trouble of this argument is that it's beside the point.  What is required is not human honesty, but human awareness of their *dishonesty.*  If we are aware of the games the elites play with the power we give them, we'll simply refuse to give it.  Taking the power of money from governments and central banks requires no more fundamental understanding than taking economic power from former socialist governments.  It's as simple as understanding that power corrupts.

The point was correct and agreeable to some extent. In any manner paper is never comparable to anything in value like silver and gold. It's just a piece of paper with no actual value except for the cost of its printing and it could be put into flames like woods in a fireplace. But we should also understand that what makes it valuable is how the state or country created it as a back up the real valuable reserves. That is why they are too careful not to over print it or the econmy of a country could collapse by the imbalance created. Should its value goes to zero, one thing is for certain, the country had collapsed or have replaced it with another form of currency, or maybe the world ends.

I would predict that when 'the system fails,' there are multiple possible scenarios that are very different from each other.

The worst one is economic and societal breakdown.  I certainly don't hope for that, since I don't know anyone, myself included, who is really prepared for that scenario.  Even if you grow or store your own food, it can be taken from you.  Even if you protect it with guns, you can get killed.  (Also, I believe the other scenarios are far more likely, as the elites actually have a back-up plan.)

At the other extreme, the least disruptive scenario is loss of faith in core financial assets, caused by the collapse of some big asset class or financial institution.  In this scenario we still have law and order, and money is still good in the economy (and likely too good,) but the elites will need to take a no. of drastic actions to keep what remains of their system together.  Part of the mix will likely be a de-facto devaluation of their state money against non-state money, to stabilize state money.  This happened, for example, in 1934, when the dollar was devalued by about 50% against gold (and other currencies did even worse, as they had to be taken off gold.)

Somewhere in between the two extremes would be a change of the global monetary regime.  The last time this happened was across World War I, when the US took over global empire from Britain, and a dollar-based gold exchange standard replaced the classical gold standard.  Unless the system lives long enough to see a rising India mature enough to take over the role of the US, this option is not available this time.  A massive devaluation against non-state-issued money, and/or using crypto as the chief non-state-money (if crypto can mature fast enough in the public imagination,) is the likely response.

The trouble with investing in things like real estate and base commodities, thinking they are 'real things,' is that the demand for these is propped up by the elite-controlled system from day one.  So you're not only buying over-priced assets, in a collapse, there's a better than 50/50 chance that the lack of demand from the loss of the asset bubble will drive their values down.

In the two latter scenarios, non-state-issued money like gold, silver and Bitcoin should do well.  Among the three, Bitcoin is especially cheap today.

The key thing to remember is that, during 'good' times, the elites always manipulate non-state-money values down (perhaps with the exception of cryptos, since the elites must allow them to rise to a level that makes them a player, but that's only for now.)  This presents us with an excellent price level to buy non-state money for the long haul.  They won't let good non-state money totally collapse, because that's their back-up plan. The net effect of all this is that we have a one-way bet, for the long term.

"If the crypt can mature quickly enough in the public imagination "! What should be done to make this mini revolution occur in the minds of ordinary layman? How to attract an ordinary buyer to enter the Crypto market? My friends had a little experiment: asking a question on the streets to young people, outwardly quite educated: how do they think if there is a future for crypto currency? Is it ever going to win over Fiat money? So, less than 10% of young people were skeptical about the progress of the crypt. How is it necessary, what ways, what actions and efforts it is possible to promote the crypt? How to attract the maximum number of people to this sector, so that the Crypto currency was the same everyday payment means as Fiat?

Yes, absolutely.  The likes of Weimar Germany, Zimbabwe, etc. are rare.  The trick is to keep a limit on printing money, so the system stays alive.  And the top of the imperial system (which is the US, today) is the best at this game.

Among the major tricks in the bag are:

- Giving a good and proportionate share of the fruits of the theft to appropriate large groups (e.g. professionals, educated people, the entire Western population to some degree), so that they consciously or subconsciously help support the system.

- Having an international political, military, trading and financial setup where the economic pain from burst bubbles at the top of the system can flow out to countries lower down the system.  (And at the low end, like Syria or Yemen, we can have war.)  The elites want to have this pain in order to avoid too much money-printing to inflate away the problem, which would quickly destroy trust in the system.  Pain always flows down, and value always flows up.

But the core nature of this system is that the incentives always lead the elites to destabilize their own system.  Ultimately, the US differs from Zimbabwe only by degree.

The usual reasons to do that behind a war is conflict between two countries or areas and greediness for the resources. Then again bitcoin will recover

I think as soon as we went off the gold standard in the 1970s the system was doomed to fail. This experiment will inevitably fail. Printing off money through quantitative easing is a short term fix to a long term problem!

I think the Fiat in many countries will fail, although it is essential for the exchange of money as a country, but we see that the frat in all the countries of the world in the past few decades is a vicious inflation, which is a plundering of the people. Maybe bitcoin can make that happen. We hope that bitcoin will at least reduce the inflation rate of Fiat.

It is one of the biggest dilemma that we were only be seeing the paper money since centuries and that there was no other alternative which can help us in a better way.

However, with the introduction of the crypto currencies, we have seen a lot of positive change and the personal satisfaction but still there are so many people who don’t know anything about the crypto currencies and that it will take time to help them out as well.

That is why the cryptocurrencies are here to replace those fiat currencies in the future since they always fail and it is best for us to just wait and have a lot of patience because in the future like a few years from now, we will see a cashless society which have a lot of advanced technologies compare to our slow type of technology.

Regarding this and your following posts where you also make references to "key" arguments allegedly brought forth by the establishment, I can't take this as an argument in its own right. I rather consider it as an evidence of no more arguments. If someone belongs to the establishment and says something (note that this is not the case here since you basically just came up with an excuse), it doesn't mean it is false and has no value on its own. If someone whom you dislike very much says that the Earth is round, would you challenge that too?

Deflationary money is a hindrance to the economic development, it is a universal truth, no matter who says it. It can be argued whether a small rate of inflation is good for the economy and how small precisely, but with respect to deflationary money, there is no point in arguing how detrimental it is. In essence, deflationary money is money only in the part which is not deflationary, the part which actually gets circulated.


There is no free market, it is an abstract idea or notion which is used to build economic theories on, which may or may not hold in practice. In the end, it all comes down to individuals seemingly acting in their own best interests, but the problem is these actions are only seemingly rational, while in reality they are far from that even at the very cursory inspection.

The implications of the incident in the currency-devalued state-he has to pay more for products and services from abroad, whereas overseas people will be more products and services from countries devalued in their currencies. This is a real injustice, because of the inability of the government to maintain the value of its currency, due to the use of fiat money.

There is no doubt FIAT currency is broken, and cryptocurrencies are definitely a solution for what has been flawed. I do hope many people become more educated and soon will realize how broken the system is.

What matters here is whether the economy grows over the long term. If it comes about through manipulation, then so be it. It looks like you fail to understand that the manipulators ("the elites") are in the same boat with the manipulated ones. They are also vitally interested in the growth of the economy at large. Or do you really think that kings and rulers lived better lives than most people today in the developed world?


Try telling that to people who bought at December highs. Personally, I would stick to gold since as I said, I'm pro-gold deep inside, long-term wise. For the record, I'm pro-Bitcoin too, but I would never trust my life and my wife on it. If you have some funds you want to multiply while your well-being in no way will be affected by losing this money, then Bitcoin as well as other cryptocurrencies may be a right choice after all, depending on your risk tolerance. But no matter how much you are willing to expose yourself to the risks associated with Bitcoin, it remains a highly risky asset.

I never mean something is wrong simply because it comes from the establishment.

This argument comes from the establishment, yes, and I only mention that because our system is fundamentally deceptive, in the sense that intellectual dishonesty is incentivized across the society, so that, for example, all 'top' economists, if they value their career, will not expose that fact that we really live under socialism.

Deception likely also means plenty of online commentators are secretly paid to propagate the establishment arguments.  I have no evidence of it (because I'm clearly not one of them!) but all the incentives are there.


As I wrote often, and I would like you to respond to it this time: deflationary pain as we know it is only because various demands in the economy have been inflated artificially during the inflation phase of the asset cycle.  And this artificial inflation is what state-controlled money does.


So you make a 'moral' argument that money 'should' be flexible, for the common good.  But when someone brings up a counter-argument that money should be market-based for the common good, you argue that the world is what it is, and there's nothing anyone can do about it?

People don't always act rationally, true.  But generally speaking, people don't want to lose money in the financial markets.  The fact that market booms and busts happen all the time over the modern centuries can be simply explained by savers' reaction to state-driven monetary inflation to benefit the elites, and yet mainstream economists have resorted to all kinds of psycho-based theories to explain how people like to throw their own money away.  When there's a simpler explanation, let's stick with it.

This is a key point.  Growth is a function of advances in technology, management, etc. and in its natural state needs have nothing to do with the monetary system.  What state-money has done is to create artificially fast growth, during the inflationary phase of the asset bubble.  We are incentivized to buy things we don't really need.  When the asset bubble eventually crashes, we have economic pain.

The way the system works is that the best benefits always flow to the top during 'good' times, and the worst pain always flows to the bottom during 'bad' times.  So, you're correct that the elites prefer the inflationary phase too; it's just that the system they set up guarantees that the deflationary phase will follow.  On balance, the average member of the elites does much better than the average person, over the long term.


Hindsight, as they say, is always 20/20.  When you're at the December highs, you can't tell if it was a high water mark, or it was like last spring and summer when Bitcoin kept going up and up.  Just forget all that, see the big picture, and hold on to your Bitcoin for the long haul.  Of course, always diversify your bets, since even if you're correct about the way the system is going, there's always a chance the elites can change the game.

     I believe so too but I think that crypto currencies cannot offer a solution yet since crypto currencies as of this moment has more flaws than the fiat. I think that fiat is still better than cryptos in terms of easiness or usage and availability. And out of all the things that has happened in the past, it would be really impossible if people on top never really learnt anything from the past. I think it would be safe to say that as more mistakes happen, more is learned and improved.

Yes it is very true, this is happening right now in my country, fiat exchange rate has decreased over time due to inflation or others, it is really very sad, I am very afraid to have a lot of fiat because the decline is very drastic lately this. now i begin to divert to cryptocurrency money i hope the future will be more stable than fiat.

fiat money when is not backed by a standard as stated in the post is something with low resistance but at the same time no one wanted to try that resistance and hope btc will be the one.

I think it's likely the major thing that has been learned over the last 40+ years by the elites is that totally fiat money makes for an unstable world (not just financial troubles but wars and terrorism.)

As I wrote many times, the elites would love to go back to something like the gold standard, where they still rip off the world, but more slowly and with more stability.  At this point, it seems likely that cryptocurrency will be used as the new gold, since the Western countries don't have much gold left (since most of their gold has likely been spent in the four decades of suppressing gold prices.)

It does not matter because of the fiat problem so there are such problems, as you say. There are also problems in our country not just because there is already a fiat. There are so many good things to do with our fiat, we use it for trading or anywhere in the country. There are just a few countries that do not really accept fiat as a currency, then the war begins. Kung ang cryptocurrencies ay magsisilbing ginto napakalaking tulong nito satin. 

Problems is just a part of our daily lives. So I could not say that the reason behind that is because of fiat money. We are using it for good. But if there are other ways to solve the worlds problem and it will be using other currency instead of fiat, and if it will be for the common good then why not?

Fiat currency has aways been there since the bginning and it stil there up to now for as long as people could use it for their everyday transactions in life it would still be there not unless there is changes in currency that government itself abolish it and exchange it to virtual currency...anything can happen we never know.

Physical gold and silver are objectively the best money.  The 'problem' for the elites is that they can't profit much from a gold and silver monetary system.

This is analogous to medicine in a sense.  Cannibis (marajuana) is a natural pain killer that has proved itself over the centuries.  The 'problem' is that there's no profit for drug companies and not much extra power for politicians who regulate it.  So it has been banned until popular demand is so great in the US that the ban is slowly being removed.

The system prefers artificial pain killers, with all their side-effects and problems of addiction, because they give power to the elites.  It's the same with money.

I somewhat agree with you that a monetary system should not create an artificial growth, though this is a separate and very complex topic in itself, with arguments both in favor and against such growth. But how does it challenge my point that the elites are also interested in the common good over the long term? Besides, the problem with a limited-supply monetary system is that it heavily interferes with the economic growth. Basically, money should make economic relationships easier or, at the very least, not stand in the way. However, a limited-supply currency takes away some percentage of economic growth as it rewards holders for just holding that currency.

But if you reward someone, you should necessarily take from someone else. There is no free lunch. In this case you take some share of the revenue from producers who are actually doing something useful and give it to someone who doesn't do anything productive, who does nothing apart from sitting on their money. Why should they get rewarded?

Paper currency encourages violent crime by making robbery pay off and drug dealing and illegal immigration profitable; by giving criminals an easy to use means of payment, Rogoff pointed out. In The Curse of Cash; he noted that the Swedish government greatly reduced the number of bank robberies by simply lowering the amount of cash in circulation, which made such crimes less profitable.

Ironically, this is a claim that is leveled at Bitcoin and other Cryptocurrencies, that they facilitate crime when it reality cash is by far the largest method or exchange for criminals.

A very precise illustration or connection that you do mention on here which i do completely agree on this one. On all sorts of things which elites wont see any benefits or money profits for them then its normal for them to make a move to get rid of it and do let get inside on things which will make them more wealthy. We cant do anything about it but to witness that dumb thing this why its always been part of the society on this kind of system.Making a change would definitely stay up on my own dreams.

can not be denied that the FIAT currency is experiencing a lot of dark history, but in my opinion it is also influenced by many fator such as war that happened, then it will automatically weaken the exchange rate of the currency, it is just one example of things that affect the strength FIAT money currency, I think it will be the same with digital currency value is greatly influenced by many facto, if only now the war and some mines are destroyed then the value of digital currency will also be destroyed

Fial is outdated yes it's true, but fiat is stable more stable than bitcoin. But i still believe that crypto currencies will actually catch up and dethrone fiat as a way to exchange goods and services. I just hope that fiat will crash the same time as crypto currencies become strong enough to be a global currency.

Interesting article about fiat. It can be concluded that a constantly growing amount of paper money leads to a global crisis as a bomb with a deferred action. Perhaps we are a generation that will witness and take part in the global change of the monetary system.

Gone are the days when countries print money due to the Gold deposits, but now they just print almost whenever they want and from what the articles goes on to say it means that the entire world economy is in crisis.

The thing with endless money printing is that governments can basically keep stretching (delaying) the destructive effects, but eventually the system will implode where the entire world economy will suffer badly.

It's not for nothing that those who are smart enough use gold as preferred hedge. In recent years Bitcoin has been gaining importance as hedge as well, and that awareness will only keep increasing.

Physical gold requires people to store it in a bank's safe deposit box, which in some cases applies to paper gold as well, and so do I think Bitcoin will end up like that ~ people just don't feel comfortable holding that much wealth.

It definitely wouldn't surprise me. I know people who store their hardware wallets in safe deposit box, which is definitely a no go for someone like me.

Fiat still ahead to bitcoin even bitcoin has a high value. Because not everyone likes bitcoin there are still people who want fiat currency than it. Fiat was a strong type of currency that was supported by the government. Sad but true that the endless printing of money was only depending to the wants of the government.

I agree and I am very excited to see the world go cashless , Honestly I hate a paper money because I can't maximize it fully and I can easily lost it when I misplaced it however if we go digital I can maximize my money until it last centavo and I dont need to remind myself  everyday where will I place my money because it is already on my digital wallet , amazing isn't it ?

as we know fiat money will remain in guanakan function only if bitcoin more received in a country then it can be ensured fiat money will be set aside by virtual money

You seem to get stuck with that tune ("what establishment commentators like to say"). I don't know what they say, I don't even know whom you refer to exactly. I proceed from my own understanding and it's pretty much in line with the history of money. Gold and Bitcoin are investment assets. Gold is basically a risk-free asset, while Bitcoin is a highly risky one. Gold is to preserve wealth, it is not expected to rise on its own unless things go awry in a major way. This is why gold has investment value. Bitcoin, on the other hand, is a speculative asset, and it gains such value, speculative value, because people expect its price to rise in the future. For the record, with most stocks it is essentially along the same line. Traders buy stocks as they hope their market value will surge in the future, while dividends (which are not guaranteed) come as a nice bonus, if ever.

I'm really surprised that you ask such questions.


Apart from jewelry, most of gold value comes from its ability to preserve value in situations of economic collapse and meltdown. This has nothing to do with its monetary nature due to its near-complete absence nowadays.

Yeah indeed. That is why gold has bern the most famous investment method for centuries it does not loose its value in long term. Never...

Yes, and it contolled by government, for example economy of my country based on the oil, the price of the oil changed up, but my fiat currency is the same vs dollar, so i do not trust the fiat, the prices didnt changed, and they will go up dosnt matter whats happening out of there

Fiat money always have less purchase power because inflation. Inflation because central banks always printing money and they reason is want to boost economy growth and thats why bitcoin using decentralized system because no one can control the supply

We never know the stability of fiat currency will be stable on its value,but as long as the fiat currency still serve to the people everything is in progressive function and asset to us.

Are you serious? That devaluation lasted for over 100 years, which gives you less than 1 percent annually. In fact, it is even less than that if you take into account compounding. For example, 1% devaluation in the last year would be equal to 10 dollars in absolute values. How many currencies do you know that would last as long and are as stable? If you account for real price inflation, you will see that gold gets devalued too, though in a lesser degree. You let the figures speak for themselves but you don't tell all the figures, but half-truths are worse than outright lies. You forget to mention how much wages increased since 1913. Recalculate the current price of gold in terms of, for example, hourly wages, and you will see how much gold appreciated in real terms.

Just do it, and you will be surprised how badly gold fared. It depreciated almost 2 times in terms of real purchasing power, and you simply can't say that it is what "establishment commentators like to say". These are the real figures, which you choose to ignore.

Who can ever forget the great economic teachings of the imitable Tyler Durden.  It's hard to take seriously a bunch of clowns who peddle conspiracy theories under a pseudonym on the internet, but let's pretend anyway.

You have to zoom out 100 years to make an argument that the dollar is not stable. Over years, the dollar is stable. Over decades, the dollar is predictably fairly stable. In both cases, the stability is great enough allow long term planning and storage of value and for people to be reasonably certain what their stored value will be worth for long periods of time. Ostensibly, Tyler Durden would be a fan of Bitcoin, but in contrast to the USD, Bitcoin miserably fails the store of value and reasonably certainty of value aspects of a useful currency over any stretch of time.

Because you have to zoom out so far to find meaningful loss of value for holding USD, and because nobody holds wealth in USD for 100 years, the "loss of value" purported to have been suffered has never actually been realized by anyone. If you had a physical dollar 100 years ago, it would be depreciated, yes. But, you didn't have a dollar 100 years ago because you weren't alive 100 years ago. And the people who were alive didn't hold value in cash currency for 100 years. In short, the dollar has devalued by 95% over the last 100 years but nobody has lost 95% of their stored value due to depreciation of the dollar.

Most importantly, there is no such thing as perfect money. What we have in the USD is stable over long periods of time and due to the nature of value and an inability to reliably store it in this universe, that's the best you're ever going to get. Money itself isn't value; it's a representation of value, meaning it represents real things that are produced and consumed that people want/need in the present. This is the key point here: You cannot possibly store more value than what can ever be consumed in the present, so expecting a representation of value that was created 100 years ago to hold perfectly for goods that will no longer exist when it is to be spent is unreasonable. Money depreciates necessarily over time unless we can perfectly store all the value ever created, which we cannot because we constantly destroy value by consuming goods or through depreciation of real assets over time. As the value that the money represents is destroyed/consumed over time without a corresponding reduction in the money supply, money necessarily has to lose value over time.

And you still haven't answered my question, 'why do they have value?'  What you gave were pages from a speculator's handbook, not an explanation based on the fundamental reality of how the financial and monetary systems work.


The 'how' is not the same as the 'why.'

It doesn't.  It's a totally separate issue.  The elites are only 'interested in the common good' in the sense that they want their bubbles to be sustained for as long as possible, because they benefit the most from these.  But the way they go about it, and the incentives for the elites to destabilize their own system, guarantee that the bubbles will burst, with the worst pain suffered by the public.  They either don't see this coming, or they don't want to see.


It doesn't.  It merely allows savers to retain their honestly earned wealth.  Deflationary pain in the past has simply been caused by the collapse of the demand that has been propped up by the economic distortion from financial inflation during the 'good' times, in the first place.


'Reward' has been made morally relative in your argument.  When you take morality out of the issue, you can argue that when you prevent the theft of a wallet, you're rewarding the owner of the wallet and robbing the thief.  Oh, and if the theft promotes economic growth, so much more power to your argument.  (Not that I'm equating your argument with this -- I'm only saying if you give no consideration to moral issues, you will reap your 'reward.')

They say more than half of the total worldwide value of US dollar cash is in $100 bills.  This is pretty amazing, since you can easily spend a month in the US without ever seeing the $100 bill.

This points to the fact that US dollar cash has been a major facilitator of crime and corruption around the world for decades, if you want to use the language of the outraged Rogoff.  Yet it's only recently that establishment figures started speaking against paper cash. 

The real issue isn't crime.  While criminal demand for dollar cash helped support the dollar in the past, since the 2008 crisis, the existence of cash has become a net negative for the system.  That is because, over the last decade, deflation has been the main problem, and the elites would love to be able to use negative interest to force people to spend and lend.  But the existence of cash defeats any system of negative interest.

My lifetime is short compared to the 500 year history of elite-manipulated 'money.'  Some state-issued money can last a long time before they fail or get devalued to a small fraction of their value.  (E.g. the pound.)  But it doesn't change their nature, or the incentives for members of the elites to destabilize their own money.

If I had lived my life in England any time between 1690 and 1931, my paper pound would have been freely redeemable for the same amount of gold throughout that period.  It still doesn't change the nature of the system, and, as we see, there was a run on the Bank of England's gold in 1931 and the pound's 'exchange rate' against gold went from 4+ pounds to the ounce to about 1000 pounds today.

Keep in mind that the original linked article is technically about 'totally fiat' money.  These are rare occurrences in modern history, even considering we have been under a 'totally fiat' system today for 45+ years.

In the end, the difference between 'totally fiat' and other state money is only a matter of degree.  Human-issued money always suffers from the same destructive incentives.

'Boosting economy growth' is what establishment commentators like to say.  The reality is that the elites benefit the most from the various bubbles supported by state-controlled money.  (A major example is that politicians can issue government bonds that are almost as good as money -- since the central bank can print money to save an indebted government from bankruptcy.  So politicians are almost as good as being able to print money.)

State money does boost the economy, but at an artificially fast rate, and always with a financial disaster down the road.  After 500 years of this, the elites either don't know this will happen, or don't want to know.

Again, there's no need to argue.  Put a hundred dollar bill next to its equivalent in gold, on the same table, leave them there for a century, and see which one is now worth more.  No need for more words!

And yes, wages have gone up, of course.  (One would hate to live today on 1913 wages!)  So earn today's wages, but put your savings into gold and Bitcoin, or at least that portion that is meant for long-term safe store of value.

Sorry, this is an establishment-friendly opinion that forgets a few key points.

A long time frame of history shows the basic nature of state-issued money (as the devaluation of the dollar against gold by 98% shows.)  But chances are, the future won't be exactly the same as the past.  It took until 1971 for gold to go officially higher than $35/ounce, and only 40+ years to go all the way to $1000+/ounce.  This is due to the strength of the US lead world system, wars, etc., and this pattern probably won't repeat exactly.  So who knows how far gold and Bitcoin can go in our lifetime, or in the next decade?

Yes, the dollar has been relatively stable over the last century, compared to other state issued currencies.  But the price the world paid was wars and imperial aggression.  Just two examples:

- World War II was caused by the rise of Hitler, which was caused by the instability and tight deflationary squeeze that the US lead system deliberately put on Germany during the post-World-War-I period and the Great Depression.

- Poor countries were bribed or forced to borrow massive amounts of dollars after World War II, more than they could hope to repay.  (This became one of the major support systems for the dollar as it guaranteed the countries would always be thirsty for dollars.)  Only a few leaders were wise and courageous enough to resist this system, and 'regime change' was the fate of those who didn't change their minds.  (See 'Confessions of An Economic Hit Man' by John Perkins.)

It is true that money is only a representation of value.  It's only a claim on the future real productivity of the economy, and who knows what the economy can do in future.  All true.  But this establishment line forgets that the destructive incentives inside a state-money system further destabilize the value of money and life itself.  In fact, we can argue that the majority of economic, social and political instability has been caused by state money.

Zooming out so far is only to make it super-clear that state money is clearly losing value.  From last year to this year, do you expect any price to go down in fiat money?

If most people don't hold most of their savings in cash, that is because they are forced to invest in riskier assets, by the design of the system (ie automatic loss of the value of your savings, unless you take risks.)  What this shows is that this is a system of theft, by design.  (Another way to say it is that it's an inflationary system, by design.)

Oh, and it just happens, if you put your money in the (shadow) banking system, or buy stocks, the advantage goes to those who know which banks will be bailed out, and which stocks will do well.  (Not to mention the top elites whose lives are based on issuing debt.)

Yes, fiat money does not the applicable use in making transaction by buying, selling, paying and investment. I consider it as a running to its forgotten place to let crypto currencies rule the economy.

You can't store value permanently. It's physically impossible. Things that have value decay and are consumed, and value is constantly destroyed through these two means. The failure of goldbugs is that they expect that all value ever created will last forever, which is why they push the gold standard so hard. It defies economy reality. The value of what you create in the present is going to be worth significantly less in 50 years, and the money that underlies that value should likewise be worth less. Value starts to decay the moment it is created. When money doesn't also, it creates deflation. The appreciation of value in money creates disincentives to spend, which lowers economy activity and puts downward pressure on the economy. Consumption is what creates value, and inflation stokes consumption. It may look manipulative, and perhaps it is, but it's far preferable to the the types of crises caused by the gold standard and our collective inability to shorten the duration and severity of those crises. If all value ever created was storable infinitely, the gold standard would make sense. Because value can't be stored indefinitely, gold ultimately does more harm than good.

Agreed, Fiat money has been used in crimes and other evil doings, well most of the currency does, But fiat fails more, It cant be used in many transactions like, digital or economical advancement.

Yeah fiat currency are tradeable by using in reality. Need some aplication for any online trade and making so much fee in it to doing transaction

You could say that all types of currency eventually fails. Crypto is a new type of currency, but it might end up failing one day. We don't know. Many do. Sure they are shit coins, but they were a currency.

I've been hearing variations of this statement for years now, so much so that my mind just tunes it out when I see the words.  "Fiat always goes to zero" is part of the propaganda that precious metals dealers and others use to play upon people's fears so they can sell them gold & silver. 

The US dollar might eventually die.  It probably won't in any of our lifetimes, though.  I think bitcoin has a better chance of becoming obsolete and dying than any of the world's stable fiat currencies.  Be very careful what you listen to when you read this shit on the internet.  Always take into account what people's motivations might be for telling you why you need to own gold & silver--they're probably trying to sell it to you.

Of course, the crypto-currency market, this is the most risky market, at any moment the whole market can get under a ban.
I believe that in order to profit from capital, you can invest in gold or deposit in a bank.
Money should not be in a static state.

I think, like most people, you totally misunderstand the gold standard.  GS (as opposed to using physical gold/silver as money) was fundamentally no different from today's 'fiat' money, in the sense that the elites issue money and debt out of thin air and prop them up with state power.  The only difference was that the elites owned enough gold to be able to use it to help prop up their issued paper money.

No wonder, the GS period was full of crises too.  That the GS elites tightened money and worsened the misery after a financial crisis is often blamed on gold by mainstream economists today.  The truth is that this tightening action (and its motivation) was not different in nature from today's.  E.g. the IMF forced SE Asian countries to tighten after the 1997 crisis, and at the other extreme even the US post-2008 didn't inflate the money supply enough to totally undo the pain from the bust.

The difference in the degree of post-crisis loosening, both among different countries and between the GS period and today, is due to how much the elites can/could get away with politically, not to gold.  (Even though the nature of a gold-based system might have provided more of an incentive for the elites to tighten, there is no essential difference between the different money systems.  The goal is always to benefit the elites, at the cost of pain for everyone else, when necessary.)  As Barry Eichengreen admits, the growth of Western democracy and labor unions in early 20th century, with the resulting drop in popular tolerance for pain, made the gold standard pretty much untenable.

Money as a store of value is a major benefit of a post-bartering economy.  If you want to argue that this benefit is physically impossible, you have to ignore the fact that even though physical resources decay as soon as they're made, the savings in a society incentivize future production of the resources.  And this is nothing more than natural market incentives.  Simple market incentives also dictate that the older one gets and the more savings one has accumulated, the more one wants to spend.  This also seems to be ignored by those who argue that central bank money printing is the only ultimate support for demand.

The real question is not whether we want to stimulate consumption and avoid deflation.  Of course we do.  The real question is whether that process should be driven by market forces or central planning.  Over the last five centuries, central planning in the money sphere has proved itself fundamentally no better or different, though more invisible, than the central planning of a socialist society.  We always have financial crises.  Safe assets are always depreciating.  And we always use wars, assassinations, and coups to support our money system internationally.

The only reason we have the current money system is to benefit the elites.

Bitcoin and fiat currency made a balance in our society. Bitcoin is a digital currency which guide us towards a advance society. Sometimes fiat currency disappoint us like, Fiat currency is a physical form of currency so many time its duplicate are made by criminal minded which affect our society and our country economy too. Using of fiat currency is not always safe and easy to use. Like i said fiat is not fall always. It is a usefull asset in where no Internet or electricity connection present.  ;)

yes indeed. that is why all banks aim to pay interest when you put money to your bank account. it promises to protect the value of your fiat currency. (but ofcourse the rates are never enough because of traditional banking system)

This and other facts have been stated to prove that fiats will be impeded as technology takes over the future.  Most cryptocurrency experts have said that bitcoin price will increase again. And same for the alcoins too. Bitcoin is the digital gold and will always be on top of the rest.j

This paragraph contradicts itself. If the GS was fundamentally no different than today's fiat money, there would be no reason that the "elites" would need to own enough gold to back up the paper money since the paper money was created out of thin air and propped up with state power and had absolutely no tie to gold. It is because it was fundamentally different in function that the change was necessary. The GS backed paper money by allowing people to exchange it for gold the equivalent in gold. That is fundamentally different than the fiat money system we currently have.

It is time the economists  across the globe know that fiat currency cannot rescue the world from economic melt down. Cryptocurrency and blockchain is the solution. Cryptocurrency gives people opportunity to carryout Business transactions without constraints

The GS was fundamentally no different from today's 'fiat' money in the sense that the elites prop(ped) up their system with state power, while issuing paper money whose volume had really nothing to do with real economic needs but everything to do with the elites' needs to benefit themselves.

The difference that you mention is only in the precise mechanism with which they prop up their system.  When they had enough gold, they could afford to allow anyone (at least in 'top' countries like the UK and US) to redeem paper money for gold at the fixed rate.  This prevented any appreciation of gold in state money terms.  But gold famously earned no interest, so, as long as their bubble lasted, the average saver was incentivized to put their money in interest-bearing debt based on paper money.

When they don't have enough gold, they have to resort to clandestine suppression of gold prices via derivatives (see serious books such as 'The Gold Wars' or 'The Gold Cartel' for evidence) to make it appear that gold is losing value all the time, except for brief periods when they have to allow gold to go up.  This is why I always put 'fiat' in quotes.  We never left the gold standard in any real sense (if you define GS, properly, as simply an elite-sponsored system for suppressing gold prices in state money terms.)  We never left because the elites have never been able to.

The fiat currency has never failed Howard it just an evolution from the phase of the global economy know when you look at the phase of the fair it is just an evolution from the barter trade system and this is just a symbolism of the fact that democratic form of currency always prevails in this system

No fiat currency cannot fail at all.Fiat currency is used by whole of the world and it cannot be overtaken by any other form of currency.Fiat currency is functional since the traditional time period and every person on the Earth uses it.Fiat currency is accepted internationally and all the transactions are done through the fiat currency only.Fiat currency is centralised so it is backed by the central banks and governments too.People trust fiat currency only.

3rd parties are printing the money for most of the governments worldwide now, thats why people like you and me every year loose money due to so called "inflation"
Which is actually due to government ordered 100 billions and have to pay back 105 billions, there are no 5 billions on the market, so it will be taken from us.
Our current money - dollar, euro etc. are simply just paper, and nothing more! Only because people are being paid for their work with fiat, can buy things with fiat - it has value.
But nobody, really nobody can tell you how much dollars or euro are out there, because the banks even don't know.
So once again our current money will be replaced soon enough, with something better and what haves real value.
Fiat currencies will fail and fail hard at the end, unless 3rd parties will be printing more and more money, making countries go deeper and deeper in debt - that's what actually happening when they take another 100 billions.
I wouldn't be that sure about all people trust fiat only, as i know very wealthy persons who already transferred a large part from their money into bitcoin and ethereum for example few years ago, and i'm pretty sure they don't regret it.

Fiat and the gold standard are financial practices that are hopelessly outdated. They are very hard to give up because they have been the basis of the world economy for many years, but the world is changing and the financial sector will have to change with it.

I don't know for sure but to my mind this takes place due to the fact that it doesn't have a reliable strategy. I m sure that it is possible to trade only btc and ether , as for other currency i m not sure it is worth efforts

I agree, the fiat money is a short term popularity, it will be replaced by another kind of currency in a long term. However, in the near future, it will be prosperous and attract many investor.

Because fiat currencies are very uncertain. They (not all) depends on US dollar. And when the USD fails, all of them will be affected. Thanks for that interesting link. Cryptocurrencies is the next generation money of this era.

Some of you guys in this forum are full-time dumbos. So you think that when dollar falls that means that it is over for the whole world and that Bitcoin and other crypto currencies will come and take over 😂? Sounds like something only a dumb person would say. How can you be thinking that? Whenever dollar falls, the value of Yen and Euro will appreciate. Bitcoin is not a real currency, it’s just like something else made to be on its own and when you’re using it you’re in complete control of your money and not the government being in control.

Actually, electronic money or cash is no problem. Cash used for many years is no matter what it is too old to lose. However, if we have confidence in electronic money, we will reduce the cost of cash production. Electronic transactions are faster and safer.

Though it may be true that fiat fails, fiat has been with humanity for as long as humanity has economy in their culture. That being said, fiat is a hard economic system to remove or even exchange with something as new and volatile as crypto currency. It would need time and alot of patience for this to happen.

I agree on that, fiat currency might fail someday because people will prefer to invest on on bitcoins but government will still do something in order to reduce the number of investors of cryptocurrency.

This is why we need the blockchain and cryptocurrency to keep track of all the money being produced. Over-issuing fiat currency will eventually bring the downfall of all countries if not kept in check. The world debt is actually fascinating as to how it will be paid with the amount that doesn't exist.

Very honestly I do not think that it is going to happen, I think that it will take a lot of time may be more than half century when people will totally stop using their fiat currency and will use bitcoin for everything for which they were using bitcoin.

We can see the failure of Fiat in Venezuela. Inflation has completely devalued the currency. Carrying too much cash just to buy a roll of toilet paper reflects the entire cash shortage during the period of inflation. And the Venezuelan government has issued the country's electronic money as a way to reduce inflation.

It is unfortunately true. That is why we are developing and looking for something better. Mankind is evolving and we understand now that we cannot rely on fiat money. Many years ago, we even did not think about that. Everything was fine. Evolution pushes us to think further. In the future, we will have virtual money. We will not need currencies that we have now. All our equipments will be digital, therefore, we will need digital money. Fiat money was just a point in our history.

also read about this assumption and mark the history, you need to study this fact in more detail, because perhaps this is another advantage of bitcoin

It would be good to use gold as payment again or at least money that is backed by gold. Now we are paying with printed debt. It's best to keep your assets in gold and cryptocurrencies in my opinion.

It is true, that we have no choice but to use 'fiat' money and trust it, at least to some extent.  As Paul Krugman said, fiat money is backed by men with guns.

It's also true that the incentives for the elites are always to inflate and devalue 'fiat' money, so we have to diversify our savings to protect ourselves.  (But never put all your eggs in one basket: you never know how long each bubble will last -- some bubbles are backed by the full power of the global empire.)  See The Real Reason to Hold Gold and Bitcoin (https://bitcointalk.org/index.php?topic=1858027.0).

Do not forget that the money at the moment is more stable and more secure than crypto-currencies. They do not tolerate any setbacks. The dollar and the euro are growing - they are all fine.

Well, I agree and disagree with you on that point at the same time, about Bitcoin not being a real currency. I agree that at the moment Bitcoin can hardly be considered a genuine currency on purely practical reasons. You can't buy things with it directly, that means Bitcoin doesn't circulate but this is what the term itself (currency) stands for. On the other hand, there is nothing which would prevent Bitcoin from becoming a currency, there is nothing in it inherently which would not allow it to become one. It may not be a very good currency overall due to its deflationary nature (and a few other issues), but this is a completely different story.

I don't think fiat always fails, you can see fiat has been using for buying and selling goods and services since centuries. Fiat currency actually create a centralised system for people and it provide system to do business. i Know why you said this statement because recent years there was a collasp of economy and Europe crysis, Venezuela currency fails. But because of few fails we can't say always fails.
well i support fiat as well as crypto.

Yup all fiats fail and they usually fail around the 40 year mark.  We are well past that as the clock started ticking in 1971.  Once the US Dollar goes down all hell is gonna break loose. 

The US dollar won't go down until the US itself disintegrates and implodes. It has been discussed in great detail and at great length a few pages back in this very thread. A fiat currency is not going anywhere until and unless the government behind it collapses. Fiat currency decay is a direct result and outcome of the ultimate failure of the state but definitely not its cause. Everyone who claims to the contrary should go learn history (Roman Empire, Weimar Republic, Yugoslavia, Soviet Union, etc).

The bottom line is that while the US economy is strong, there's absolutely no reason to think that the dollar is going to fail any time soon. Don't be delusional or lost in pipe-dreams about that thing. ZeroHedge and outlets like it have incessantly been crying wolf for years without any real ground supporting their claims.

Maybe on history, paper money tends to be no value because of the coins they are using which is gold, silver and bronze. Those precious metals are very valuable than paper that's why authorities of centuries ago make it hard to make a value out of paper. But as you can see today, paper money is very valuable and I don't believe that is would fail.

Oh Please! That is what they want you to believe. Fiat has been doing extremely poor in the past and will keep doing so in the future. Just as the article rightly mentioned by the OP, government prints fiat money that isn’t backed by any value which obviously ensues disaster in this regard and just to be able to contain it, they keep printing even more as time goes on.

The huge interference, monopoly, and control of government in this case as well as the high extent of devaluation, are just some of the quick reasons why its closeness to getting screwed is inevitable.

Gold is a bad way for payment because not every people can earn gold and it was really hard to earn gold now a days, cryptocurrency is much better since every one can invest if they have a decent amount of capital.

most people misjudge the example: in our midst, people mistakenly believe that a country's paper money is issued by the government. whereas paper money, as well as coins that are associated with it - and bytes in the computer he created - are issued by the central bank. Most central banks are private companies, privately owned by a group of bankers. more than that, most of the money circulating in the community is no longer in the form of 'physical money' (currency, paper and coins)

In my opinion if dollar should fail, I don't think other currencies will follow or the entire world will be in a bad economic state.  Given that the reason will be the fall of dollar only. There are other countries which I think is sufficient enough to stand in their own and might not be affected should it happen. Yet resources and the entire economy should be stable if all countries will work together. 

Central banks are no more private that governments themselves. They ARE part of the government, or rather ruling elites and establishment. Indeed, such a government may be foreign to a country of the central bank's residence (read the central bank in question may be de facto governed from abroad), but this doesn't take anything from the fact that both the government and the central bank are an integral part of the establishment. To put it differently, it doesn't make sense to distinguish between them in terms of people and elites who are behind them and have real control over them. These are the same people, bankers or whoever, private or otherwise.

As a business risk, fiat money cannot be ignored. What matters is how can this money later act as a medium of exchange for an item, even though it does not have an asset guarantee? This problem then invites thought from market brokers around the world. Please note that money is usually used as a medium of exchange when it has a "Exchange Rate Standard" recognized by the market. As with the history of the previous money that made salt as a medium of exchange, it must have exchange rate standards. In addition, money must also have a nominal value that can be guaranteed

No, every cryptocurrency are going to fall if bitcoins will drop its value, that is the reason why you should always take advantage of the market invest a huge amount when the market prices are dropping.

I think these are people's own mistake. They talk about money and paper money there, and if there were digital money instead of them, it would be the same result. The using of digital money will not guarantee that economic problems will not happen in the future.

Honestly, I don't quite understand what you want to say in your post. What do you mean by money "having exchange rate standards" and "not having an asset guarantee"? Do you refer to gold or silver backing of a paper currency? It doesn't work simply because gold (silver) doesn't have absolute value or just constant value. The same is equally true in respect to any asset out there. In fact, nothing has absolute (constant) value which would remain the same in any frame of reference (coordinate system) or over any significant amount of time, so the emergence of fiat money which is not backed up by anything is completely justifiable and totally acceptable.

Strictly speaking, money based on or backed up by time makes perfect sense (see In Time movie), but we are far from that.

i think that both of them have their strengths and weaknesses. of course if later the digital currency is used, it will certainly have its drawbacks. but i think the digital currency has advantages for the modern era

The presence of bitcoin is a good thing for the future of the currency system, with bitcoin then we can transact faster and easily so I hope bitcoin will soon become an international currency.

The Fiat currency is an imperfect financial model, which is already obsolete. You should pay more attention to digital currencies.

Any particular fiat currency can fail, and there is a long track record of failure, but fiat currency as a concept is actually just fine, and in fact the most useful way to sort out trade, because it is simply too inefficient to go back to a pure bartering system. On the other hand, technology is deflationary, the cost of goods and services goes down with respect to the total amount of money in the system.

Countries got out of the depression in the exact order in which they left the gold standard. A growing economy needs an ever growing stock of money for transactions.

Yes, this is how matters stand with fiat vs. so-called hard currencies backed up by gold, silver, or any other tangible asset. But it is hard for many or even most people to understand that as they see the value of their money being constantly eaten away by inflation. In the majority of countries around the world annual inflation is two digits anyway, and in some like Venezuela it is outright ruinous. But it is not the fault of fiat money conceptually, it is rather the failure of the government that runs that currency. It is like a potent drug which can save your life but it can also lead to devastating consequences if misused or abused.

Nothing at all will make bitcoin stop from being a currency as long as its real life usage starts becoming more pronounced.
On the issue of fiat failing, I would not say it totally does, but we all know how much fiat has been weakened several times and still keep getting weak due to all the manipulations and controls by the government,  which at a point, I seriously hope it does not end up imploding. That will be too much to assume anyway but in this case we are not just talking about USD, but fiats in general.

The article you shared explains only paper money which is in history was not backed by gold that's why it fails. In recent generation of currencies, Fiat is a strong testament that a countries economy is growing or falling.

I love Bitcoin and I believe that it can become an international currency but I am also sure we will never get rid of fiat. The traditional money is very convenient no Internet is needed.

The ramifications of the occurrence in the money depreciated state he needs to pay more for items and administrations from abroad, though abroad individuals will be more items and administrations from nations debased in their monetary standards. This is a genuine shamefulness, on account of the failure of the legislature to keep up the estimation of its cash, because of the utilization of fiat cash.

Although I agree that fiat currency always fails, it will still continue to exist. Somehow, fiat is a bit like bitcoin in the sense that the exchange rate goes up and down quite frequently. Plus I do not think that there is and should be a competition between fiat and cryptocurrency, right?

Fiat currencies are considered far more stable than commodity-backed currencies. That's because the value of a commodity is based on its stability, and its price will tend to fluctuate based on its physical reserves. It has a high risk of eventually becoming devalued and worthless as a result of economical inflation. A fiat currency system comes into existence as a result of excessive debt and the resulting hyperinflation.

I like both fiat currencies and cryptocurrencies. The rise and fall of either fiat and bitcoin are nothing to go away from. I see it to be a same level currencies though fiat is known to fail. I don't dispute that fact.

I think fiat and cryptocurencies have more in common than we generally assume because they both rely exclusively on trust and the law of offer and demand. That said fiat are also indirectly backed by networks of banks and central banks and many other institutions yes. What I like  the most in crypto is the transparency of the rules (codes) and the endless possibilities in the real of smart economies and digital scapes.

Very nice Smiley

Yes, fiats fail eventually, but their downfalls don't come about entirely on their own. It is the downfall of the state which ultimately leads to the collapse of its money, not the other way round.

Regarding Bitcoin becoming a currency, you just said what can be called a tautology of sorts. Being a currency already means real life usage, by definition. In other words, if Bitcoin is used, it is already a currency. Or to put it differently, being a currency suggests being widely used in real life as a means of exchange. It is just two different descriptions or definitions of the same thing. But whether Bitcoin will actually become used globally (on par with fiat monies) is a different story, though.

yes, right, competition between fiat and crypto does not need to be precisely the two must work together as a way to increase the second value of the money.

This is true but the big problem here is not that fiat currency fails but the terrible effects it has in the economy in general and in the economy of each person, when the fiat currency fails it tends to sink the country and everyone becomes poorer because of it and then you need to trust that the government is going to finally get it right when they issue a new currency.

I think it was not born to fight. So there will be no failure. The main purpose is to promote the economy and give people economic exchanges. The appearance of it has centuries of currency. So there will be no battle to fail. It is the existence that exists in this life. That is my opinion.

Yes, fiat money being not back by anything, lets governments off the leash and gives them an instrument to abuse, and it's not surprising that most of politicians do abuse it following their selfish goals.

There is no fiat that failed, so far Fiat has been very helpful in the community. fiat has existed since a long time ago, maybe now we can say that fiat failed because the economy is increasingly pressing so it raises the assumption of another currency.

Yes in the first place, crypto amd fiat are very different from each other. Characteristics and even its value they are just both a curremcy which people need. Fiat will always be fiat even it fails unlike to crypto that when it fail it will be useless to people who have it.

Fiat money is money that has no intrinsic value (material value). He only keeps extrinsic value, namely the recognized exchange rate and obtains legality from the state.

Dollar itself has adjusted from a proper link to some kind of unknown backing and is entering its final stage of no backing at all except the willpower of foreign creditors to keep buying debt despite a long term trade imbalance and a potential trade sanction war to discourage trade.      Its all adding up to make dollar prospects unlikely to best over any solid alternative.

The point is these things happen gradually, for example with the USA dropping gold at Nixon's command it still left some standards left for a few years after like the Swiss held a gold backed currency for decades until the end of the century.   They recently voted to return to a gold standard but instead dropped a policy of duplicating EURO money printing which helped restore some value to their national currency.

Other countries will not collapse from just one country.   I dont even think USA will cease for the idea of paper, alternatives will be found and BTC is just one of many hence why its most important it be made as easy to use as possible for a diverse population.   Other possibles are commodity backed currency such as Canada or Australia which in the main are large land masses with centuries of assets to back the worth of a national note.  USA can justify returning from a dollar failure, it just be a hiccup not the grand melt down some might fear.   We will be better of without false dollar value, collapse is not the result but unsuppressed growth.   This is presuming we dont do silly stuff like go to war, debt failing can produce some angry people

I understand what you want to say and in most cases it is quite reasonable to assume that fiat doesn't have any intrinsic value. However, technically, money, any money for that matter, has a certain intrinsic value for just being money, for being used as money. It is specific to an object being money, not the object itself. This is called transactional utility, which essentially comes down to advantages that money provides over direct exchange of things, in other words, barter. And this utility can be measured in money terms too, i.e. in the same money (understanding that is not quite straightforward, though). It is called the price of money, and it typically considered to match the overnight interest rates that large banks use to borrow and lend from each other in the interbank credit market.

yes maybe not only in fiat currency if you are aware of the cryptocurrency currency conditions also have a very high risk and can even be failed because in the future no one will know whether the technology is still used or not.

Fiat will fail depending on the economy, the price of cryptocurrency will decrease depends on the inflation rate while cryptocurrency is just basing on supply and demand, that's the reason i prefer digital coins rather than fiat.

Fiat is the strongest currency I think the market will never be able to replace the fiat and into it the cryptographic coin, the crypto is just to support the economy somewhat

And that is another problem with fiat currencies, in theory a fiat currency could work but politicians abuse its power, they do not want to pass unpopular laws to raise taxes and they use the easy way out of just printing more fiat currency and tax people in a subtle way but eventually like always they are going to lose control of the system and it will crash.

Fiats will eventually fail in most instances as there is nothing to back it and it is often abused by the Government by constant devaluation (inflation), printing too much of it to meet it s needs

Paper money created with no back up asset and just trust on government. Maybe thats why fiat money always reduced the purchasing power value. Central banks always print paper money to boost economic growth but inflation always increase

I do agree with you with this topic. In some point fiat currency fails, when time flies the purchasing power of fiat is decreasing. 1$ is not the value of $1 anymore. Get it? it keeps depreciating in value. and 5% of the people around the world is the major holder of fiat currency. I dont think its  a good thing right?

in some countries there is a lot of inflation with small or large numbers, but in my opinion it has nothing to do with the failure of fiat money because fiat is money that is used and controlled by the government so a good government will still maintain the exchange rate of its currency

Then you don't really know what is inflation, inflation is nothing more than the expansion of the money supply, for example bitcoin suffers inflation every year since miners mine new bitcoin every day, but this is a controlled process, but the governments just print as much fiat currency as they like and then they want to establish price controls which always fails, we have seen that story many times already, we know how it ends, and it always ends with the destruction of the fiat currency.

In bitcoin their is always have  a different situations that would always depends on how the bitcoiner run his own world. In Germany Bitcoin is already legalized it is because a lot of supporters and creators wants to achieve the perfect status of the cryprocurrencies.

Fiat money or paper money always printed because the reason of economic growth. Fails on this strategy is central banks creating time bomb called inflation and inflation will decreasing money value and  i think thats why economic crisis always happen

But do you? Do you really know that there are many definitions of inflation, and the expansion of money supply as you call inflation is only one of them, and a minor one at that? In the vast majority of cases people use the term in the context of rising prices, which means depreciation of the currency, i.e. price inflation. Typically, people who raise the issue of terminology, and especially in the case of inflation as monetary expansion versus currency depreciation (as you are far from being the first such) have nothing else to say apart from saying just that (which as they expect should give them substance and authority)

It is almost always clear from the context in which meaning the term is being used, so no need to show off here. In most cases it doesn't work as expected

Every fiats are evaluated to become successful. If crypto fiats are most likely to be ignored and failed, that is because it doesn't fit the standard and didn't pass the required characteristics. We all know crypto fiats are still unstable with inflation and deflation attitude.
But well, their are still some country who are very much open about bitcoin.

but I see the fact that currently the country still relies on fiat money, although in reality there are still many shortcomings in fiat money, the government is still thinking of breaking away from fiat money and turning to digital currency, they may not have found a strong reason to do that, but hopefully it will happen sooner and become a solution so that the monetary crisis will not occur due to the weakening of the exchange rate of my country's current currency

Fiat currency is not always fails there is just an incident that fiat currency fails. But not always time they are fails. Fiat currency is the most currency that is use many people or in the whole world. It is first type of currency that use by the people. Crypto currency was built because many people think that fiat currency is not safe, but crypto currency is not totally safe. Digital wallet or crypto wallet is the key to keep your bitcoin safe from the hackers or bad people.

The problem of fiat is that, the paper bills' value is greater than what the value it is made of and coins value is vice versa. We also are the ones who produces our own money by printing it unlike gold who needs to be mined. On the contrary, we wouldnt need to print more because of some chaos of the oversupply.

i think so, because everytime fiat currency has loss their value for purchasing any things, at this time, goods are not expensive but the value of fiat currency that has decreased

As the dollar rises, it has a huge impact on the prices of products all over the world. It is complicated when life with material value increases while monthly salary does not increase. And there is national currency inflation, there are even central banks printing too much money to make the currency lost value.

Sure, traditional and digital money will be always connected. I do not understand why fiat should fail. Yes, the cryptocurrencies will be used more often in future but it will not change much.

Fiat is failing that their purchasing power or their value is keep decreasing when the time passed. Maybe you are right that fiat and digital money will co exist in the near future but not necessarily fiat will die. Is just that fiat fail because of the one who controls it. The bank and the government, and the one who control it control the world. Crypto in general cannot be control thats why people like it and believing that this will be the new currency.

It is very true, this is happening right now in my country, fiat exchange rate has decreased over time due to inflation or others, it is really very sad, I am very afraid to have a lot of fiat because the decline is very drastic lately this. now i begin to divert to cryptocurrency money i hope the future will be more stable than fiat.

"The elites are interested in the common good over the long term." -- This is true only to the extent that growth and a better organization of society benefit the very top elites (even if true competition causes harm to some rich and powerful people.)  This is because growth is the ultimate support for the value of the money and debt issued by the top elites.

The way you can tell if they're truly interested in the common good is to observe what they do after a financial bust.

Over the modern centuries, financial busts were generally followed by a policy of tightening the money supply.  This imposed even more pain on the public, on top of the wealth and jobs lost by the bust, and basically put all of the pain from the financial bubble on the shoulders of the public.  The excuse for doing this was to protect the peg of the currency against gold or silver, to guard the 'moral honor' of the elites in being able to redeem their paper with gold or silver.  (Or the fiat-period equivalent of this argument.)

But the real reason is to protect their system.  If the elites used inflation to lessen the pain to the public, by devaluing currency against gold/silver (or doing the fiat equivalent,) the long-term confidence in their system would be harmed.  They benefited most on the way up, but the public suffered on the way down.

The first time the public was powerful and aware enough to change the above partially was the Great Depression in the US.  The government eventually devalued against gold by about 50% and used fiscal expansion to lessen the pain.  But the core nature of the process never really changed.  The elites will always do the minimum required to maintain political stability, even to this day, and the evidence of this is the suffering during the Great Depression and (to a lesser extent) the Great Recession since 2008.

Now, this is not an accusation against any individuals or groups.  It's just human nature for anyone in those positions at those times.  The key for us to understand is that, the only way to better our lives, fundamentally, is by taking the power of money from the elites.

I think you have it backwards.  You first define an elite-controlled money supply as the natural state of affairs, and then say hard money tightens the supply and is thus harmful.

The natural and beneficial condition is a state-free money supply.  (Elite-controlled money creates artificial booms which always turn to busts.)  Asset values under a state-free money supply would expand or shrink to reward or punish good and bad decisions in investment.  As with anything else, any event or change in the system takes from someone and gives to someone else, but the difference between us is that  you define 'doing something useful' as whatever activity is favored by the central planners, whereas I define it as whatever is favored by the totally free choices of investors.

The big scare by critics of hard money is the vision of never-ending deflation.  The truth is, deflation ends somewhere: as we get older and our savings get bigger, and everything gets cheaper (remember we're talking about deflation!) we have more and more incentives to spend.  In real history, the only big deflationary pain has come from the elites' deliberate effort, after a financial bust, at tightening money to protect the reputation of their system, by making the economic pain even worse.  The 20th-century rise of public political power in the West has mitigated against this somewhat, but not nearly enough.  (Outside the core countries, even today, the IMF always ensures there is an economic bloodbath after a bust.)

Is it not ironic that elite-inflicted pain is used to justify giving more power to the elites?

The minus of fiat is that it is not the main thing in its sphere.

Crypto will be part of our future and i want to study and learn about it while it's not yet popular just in case we can use it for the future so i don't feel ignorant if crypto will be accepted in many countries.

Fiat currency is helping us in different ways of life or life activities so we can not neglect its value and role therefore fiat is strong and we will have it through out our life.

We can invest in the most popular and powerful fiat as well like dollar besides this cryptocurrency has catch the sight of investors as it is a huge profitable source and diversifying investment is also a good strategy so most investors follow this strategy.

I think all currencies have very unpredictable movements, sometimes the condition of cryptocurrency prices can be very expensive and sometimes it can fall like the current conditions so it's better to use all currency movements to get a profit.

Actually, no one is particularly interested in the common good as everyone is after their own interests, obviously. And elites are no exception to this rule. You speak of them like they are aliens, while in reality they are essentially the same people only in a position which gives them a feeling or sense of superiority.

In essence, when I said they are interested in the common good over the long term, I meant they are of course interested in their own well-being before anything else. But they also understand (well, at least some of them) that their prosperity is inseparably linked to the prosperity of the whole society as they depend on it more than on anything else and more than everyone else does. The point is that to support their high standards of living, they have to rely on the whole society as their feeding ground, and thus they have to care for it.


Does it mean that elites dismantling the gold standard was the good thing for the public as there is no more "'moral honor of the elites" in the form of paper money redemption for gold?


You talk of them as if they really were aliens. Seen the V television series? Indeed, they are protecting their personal interests, but so does everyone else. So what's the point? This is not Lalaland.

When you're at the December highs, you can't tell if it was a high water mark, or it was like last spring and summer when Bitcoin kept going up and up. Just forget all that, see the big picture, and hold on to your Bitcoin for the long haul.

Precisely, no one is arguing otherwise on this point.  No one is an alien.


Leaders in Communist countries genuinely wanted the best for their country too, in the same sense that you're saying here.  Unless you can provide more specifics as to how the elites' interests are more aligned with society at large than at this generic level, we'll have to stop at this, and we know how well the Communist countries turned out.


If you're trying to argue that the dismantling of the gold standard was for the public good (as today's economists seem to argue,) you only have to look at how each gold standard was 'dismantled' only when the elites were about to lose all their gold, due to a rush by holders of the paper to redeem for gold.

Otherwise, please explain what you're getting at here.

Whether losing the gold standard was a good thing for society, is a much more complicated question, but I'll be happy to go into at some point.  Let's just say for now that the gold standard, as implemented by the elites of the time, was essentially a system of theft like the 'fiat' system we have.  But you could argue a future gold (or Bitcoin) standard, combined with the level of democratic power we enjoy today in the West, would potentially be a more stable and beneficial system than today's.


I hope we're not falling into a condition where in order to discredit the other person, you have to distort what they mean.  You can certainly do better than that!

In a certain sense, everyone is only after their own interests.  But we can certainly talk about what system best serves the interest of all, as in preventing murder and theft, for example.  And we can all agree to uphold such a system because it's in all our basic interest.

Understanding the power of creating money and the corruption it brings is the next major step in social awareness.  And it's important to explain to the average person the full ramifications of this money creation, in order to bring about proper understanding of the true nature of the system we're living under.  

Yes im agree all money are related to dollar. Its very strange and i do believe every country need to use cryptocurrency so we would see how the economy condition more easier and more transparant by blockchain technology.

Fiat money or paper money always creating time bomb and its economic crisis. Paper money always printed and the reason is economic growth but its increasing inflation. Paper money printed from thin air without proper back up and only trust from government

Indeed, after US Government not depending on Gold when print paper money/USD Dollar, purchasing power paper money always decreasing and its not safe to hold paper money for long term. Inflation make our money value decrease and crisis always coming on every country because dollar used by most country in world

I think it is necessary to store the final resources, such as wheat, milk, animals, it is also a reliable asset

Underestimate the FIAT and promote gold/silver as the measurement values ​of exchange make things worse. FIAT is one of the great inventions, and FIAT has failed economically because the country can not control the FIAT they created that made things upside down.

I understand your reason for this, and a lot of people think this way.  The problem, though, is that these are not good stores of value as they require maintenance, and will go bad after a while.  Also, the supply and demand of these things have been distorted by the greater economy, driven by fiat money.  (E.g. people think they are rich, from central bank money creation, so they buy more wheat and waste it.  So you're buying over-priced wheat when you invest in it.  When the financial crisis comes, wheat prices might collapse.)

Sell it is a cycle but it always begins and ends with Fiat. Basically Fiat is a trust. A trust that the piece of cloth or minted coin you have in ypur pocket does actually have value dictated by the governing body on finance. They can tell you that you can buy more now than yesterday then laugh at your face. crypto currency is the future.

Like i have used fiat for many transactions and fiat is also necessary for life because crypto can not be use for every thing and fiat is using for the lives from the begging so it is true that bitcoin is also important but we can not ignore the fiat as well and through fiat we can enter into the crypto world for investments.

However, you should agree that people are not yet ready to change all of the paper money they have in the cryptocurrencies. The mankind will use fiat for centuries more, even despite the inflation.

I do not know what planet you are on, but if you go out and ask passers-by about cryptocurrency and their choice between cryptocurrency and regular money, more than half of them will say that they only heard about cryptocurrency, but they never used it, and those who faced it, will give very conflicting opinions.
Let's consider the situation if you want to buy something on the street with your hands or even in a small outlet. You need to constantly wear any technical device, such as a laptop or a smartphone with the received Internet. Carrying out transactions takes quite a long time, there may also arise along the way a number of technical issues. However, the most important thing is safety.  When they steal from you a smartphone, you will immediately have a lot of very intractable problems - a SIM card, electronic card, various secret addresses and access codes, and so on. You will not carry a piece of paper with you and manually enter private keys and other codes, they will most likely be in your smartphone. There are just a lot of problems. And here you just take out the cash money - and no problems. Everything is fast and clear. The cash money are stolen from the pocket of the bill, it does not matter, this is clearly not your last. Beauty.

AS of this time since the hi-technology will strongly operated start year 2000 until now the status of fiat currency is almost backup or for short term uses because the main uses now is in digital system process like deposit in big amount through digital process how much more if bitcoin is going to top of currency much more quickly and convenient for any body.

You are right, fiat currency has its own advantages besides its disadvantages but if you look at each and every currency you will see both its advantages and disadvantages. Fiat replacing or conversion to Bitcoin is your investment and if you are not feeling comfortable with this long term investment you can keep fiat and can use it in any place. One thing is perfectly said here that fiat can cause extreme situations for government and this is due to its expenditure as well while digital money needs just investment.

I like to save money in fiat currencies. When I got to know what cryptocurrencies will offer me, I tried to weigh the merits and demerits of all and I have concluded to save in fiat always.

For me I don't think people have factored in the problem with not having enough money to meet the demands of the population.  The real problem is not what backs the money but who controls the quantity.  Also back in the late 1700s gold was fiat.  See currency act of 1764 and Stamp Act of 1765.  The American Colonies had no gold to begin with and the British banksters wrecked the colonial economy by forcing them to pay taxes in gold.   

I agree Fiat money is as strong at it is, It is true that there are some negativeness on the system but it actually works, But for me I prefer the new way of handling money and investments like crypto currency, We are on the age of Digital and technological era where we should know how to choose our way in the more profitable solutions for the future purposes of money transactions, Futuristic trading and other helping material for the economical growth of every country.

The way I see it, there are 2 separate issues.

1. Is fiat money a good system? 
2. Is fiat money good for me?

We're mainly concerned with no. 1.

I believe that this concern of failure of the fiat currency is a thing the government is always been monitoring for ages. I don't believe that these dollars doesn't have some basis. You can't just create fiat money without something backing it up or else certainly the economy would fall helpless and will crumble. How would anybody trust the value of paper without the assurance that the government being the owner doesn't have some back up value for it. And how can such a government stabilize the economy by printing a useless paper only?   So that I believe that something is backing up fiat and it is not just a paper money. It is similar to how cryptocurrency works because cryptocurrency is backed by fiat in the real world although others say they have some other things to back it up like gold, oil, etc..

I'm not quite sure that we should judge fiat like that because thousands years of our history are closely tied to it.

Yeah, cuz of inflation! Its easy , u know it.
Guys who can abuse paper money creating are doing it erryday and you are working for this shit erryday  :-* :-*
More money-less value for them  8)

It is not always more convenient to work with electronic money, although in some cases they are better than fiat. These two types of currencies have their advantages and disadvantages in use and will only go together. Cryptocurrency will never replace the national money of states. Cryptocurrency can not interact with the economy of the state, as national money does. In addition, the cryptocurrency has a high degree of volatility and, due to even these two reasons, it can never replace the usual currency.

Fiat currency has been there for more than a century and still it is working. You cannot call it a failure so easily and it will not be completely eliminated. Digital currencies are better and good but not everyone is at ease using them. Also you need technology to be able to use them unlike fiat which even an illiterate person can use easily.

Fiat is much different that bitcoins. Paper money is Centralized and usually control by governments. It will fail because  many government agents are  behind it. Where bitcoin is decentralized and its nature is increase.

To say that the currency is always losing, it seems a bit too, because cryptocurrency can not survive without paper money.

basically fiat and crypto currencies have their own strengths and weaknesses, crypto currencies cannot replace fiat currencies, each country also has its own rules on currencies, so fiat and crypto currencies will be side by side without substituting each other

Why Fiat? As I can see cryptocurrencies are already failed most in the history too many scammers and hackers trying to breach the system or exchanges, fiat can trace I guess and hacking also are involved here.

If it has failed before, it was for a reason and a particular period of time. At the moment, the fiat is gained some grounds with the help of the USDT which has helped to maintain/regulate the bitcoin price and overall, the cryptocurrency markets.

I think failing or rising effect the economy. Like right now dollars is the global currency and with the increase or dollar rate world's economy fluctuate.

With the advent of cryptocurrency, its supporters very often declare that the cryptocurrency will replace the national money of the states. This statement is completely erroneous, since it contradicts the basic laws of economic development. The main reason why the cryptocurrency is not able to replace fiat with itself is that fiat interacts directly with the economy of the state, and the cryptocurrency can in no way be connected with the economy of any state. Therefore, the cryptocurrency can go in any state only simultaneously with the national money of this state.

Fiat currency fails because central banks always flooding supply in market. Their reason always to sustain economic growth. It will increasing inflation and people asset reduced the value.

Fiat currency link bitcoin and altcoin will be more success because it give more effect by investor to get profit with their bitcoin or altcoin asset investment, by using fiat as currency investor have stronger to hold and keep their asset will increase at the future time.

the more printing fiat currency will cause inflation and fiat currency to decline in value. if this happens to the dollar then this will affect the world economy. and the ups and downs of fiat money are also influenced by the government's political conditions and negative issues. maybe because this is why satoshi created a decentralized bitcoin so that it wouldn't experience inflation. if the fiat currency situation gets worse maybe in the future cryptocurrency will replace it.

The using of fiat is decreasing. I seems that the future of currency will be crypto currencies.  People like to send and receive money with bitcoin because there's no tax applied

Fiat money fails in something simply because of its regulating body and of course the status of the economy of every country that dictates the value of their fiat currency, but we cannot eliminate fiat money easily which is still offers a more convenient way to buy and sell goods locally.

The future of cryptocurrency is there of course but I think it would be better if fiat money and cryptos will stay together and provide us a more convenient way to transact around the world, which is good for us of course so let's keep on supporting this two monetary system especially with cryptos.

I heard in Zimbabwe that the value of their fiat is very small, and the reason is because they print too much fiat but their country's economic situation is deteriorating. The failing fiat value depends on the country's economy, I'm not very good at the economy but for the past and present values are different because of inflation.

In fact fiat currencies are indeed a failed currency, also not immune to inflation and the existence of corrupt practices by officials. But what's our power, they / the government have propagated ourselves since our grandparents were just born, so that in its use it continues to take root and it seems impossible for the community, can be separated from it.

In the current era, particularly in developing countries, fiat is the most successful currency for it has a huge demand and is widely used as cash and to make instant transactions.

On the other hand, cryptocurrency is not a failure as well. In developed countries, it has been used as a medium of exchange and to save and store value. However the market is down right now due to many reasons but both the forms of money are of great use and importance.

well, in some fiat countries it has a pretty good role, but some don't. like Zimbabwe. well, basically the value of money will be measured by how well your country is managing it. as far as I know, every year, fiat always decreases.

Fiat is always needed for the economy and in everyday life. Sometimes using Fiat currency will be more convenient than crypto money.

It really needs to our economy and our community most of people here in the world don't know how to use yet online currency and I think governments will not allow to change their current useful currency to replace a not legalized currency in any country.

Fiat currency really needs to be used for the country because fiat currencies have become their daily needs as payments and transactions. of course these two currencies are useful in their respective fields, if digital currencies are useful in the digital world and if fiat currencies are useful in the real world.

I don't think fiat currency always fail there are some misconceptions with countries like Venezuela, greece. but you can most world's countries are actually dependent on fiat currency as you know United States dollar is one of the dominant currency in the world. If we compare crypto with fiat than fiat will always win because of stable price.
crypto currency has seen drastic changes in its value from last 10 months. So is there any changes in Fiat currency nothing just some negligible changes.

Fiat currency is always been there and it is performing good. So we cannot say that it is failed and unable to deliver. However with every passage of time things do change and we will see new technology taking over the old one and similarly fiat will be replaced by bitcoin one day.

Yes, people still use fiat to buy something for their life. I think fiat depends on the other fiat and we know that in every country, fiat is up and down and it depends on USD. Besides that, I think the sources to make paper fiat still reduce, and we cannot deny that in one day, the supply for the paper fiat will end so I think we need something to help fiat and the cryptocurrency can gives benefits for fiat.

Fiat currency is very convenience to used as payment especially for our daily needs. Fiat is stable in there price while crypto is an unstable, between this fiat is more than better to used for paying in store and malls while crypto is better to used to imvest or trading to have more profit but it can also used as payment but only those accept cryptocurrency. Also fiat is not always fails because its not limited and it always used for daily needs.

It will fail and also crypto somehow will fail sometimes. Everything in not that perfect and would have some faults, so be wary of the things you want to say, because today, you are still using FIAT.

That is why people still prefer to use fiat for every transaction, and they don't want to accept something new that will make them easy to make a transaction. But soon, after they know that the technology of digital currency comes to them, they will realize that now it's the time for them to change their payment system into the digital transaction. I think if they can use fiat and cryptocurrency at the same time, they can have more benefits which they can use fiat as the payment, and they can also use cryptocurrency as their investment.

Yes, not just fiat will fail, but the crypto will fail too because everything cannot be always in the top position and sometimes it will fail and we don't know when the times are. But I think both crypto and fiat can give something benefits to us although it fails especially, we now still using fiat to purchase anything and we use crypto for the investment section.

If traditional money can be used by everyone, digital currencies are only for some groups of people. You will agree that many people on this Earth cannot even read and write, they do not know anything about Internet.

it seems that is not true, the price of this fiat currency has price movements up and down so it is not always the price of the fiat currency to fall, surely there will be times when the price of fiat becomes very expensive.

right, depending on the country's economy. like today fiat currency other than dollar has decreased, in contrast to strong dollar. of course if a country fixes it with the right policy, then their fiat currency will increase