The money problem explained – Bitcoin Magazine

This is opinion editor Arman The Parman, a Bitcoin guru with a passion for privacy.


To thrive, humanity must return to free market money (not issued by central banks or governments, but created by the market) that cannot be manipulated or eradicated by central banks and/or governments. This money should also be digital to facilitate international value transfer, but few (digital tokens have always been “copiable”).

Gold worked well, but since it was physical, peer-to-peer exchange of gold became impossible as trade expanded beyond the local city to international trade. The solution to this weakness was to centralize it (using bank books or bank “notes” instead) and digitize (digitize notes/contracts) to allow banks to act as intermediaries in all non-P2P money transfers. The physical nature of gold led to the introduction of gold-backed paper/digital money, but ultimately fiat money – government-issued money not backed by anything, not even gold. Fiat money costs nothing to produce, no less, and allows governments to avoid market forces. It allows the government to expand ever more, facilitating the inexorable and gradual march to global totalitarianism.

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