Wednesday, May 24, 2017

Forget sovereign currencies and governments, the market is bringing a return to the Gold Standard through cryptocurrencies and digital banking

One of the most important paradigms that individuals, governments, and companies must overcome is that as technology progresses, so too does the way business is transacted.  And while there have been many calls over the past 40+ years for the monetary system to somehow return to a Gold Standard, the advent of the internet and the digital age is allowing this to occur outside the control and intervention of sovereign governments.


With the rise of online banking and the different types of financial entities functioning outside the banking system, the ability for one to both save and conduct commerce in gold is no longer a purview of sovereign governments, central banks, and finance ministries.  In fact, even before the mainstream rise of cryptocurrencies, several companies such as GoldMoney and Karatbars have allowed individuals to store their wealth in gold and then spend it as if it were a debit card or online bank.

But now that the blockchain has completely revolutionized the way commerce is conducted and how money is accepted, a return to a Gold Standard is no longer relegated to theoretical discussions in the classrooms of universities or the conference rooms of think tanks.  And in fact, a return to the gold standard may be already here.

Image result for gold backed cryptocurrency
Bitcoin is often referred to as a “good” money because of its limited supply, relative fungibility and ease of exchange. If gold can also start to satisfy those requirements, a seismic shift from fiat to digital could be easier to “sell”—the public is predisposed to trust gold, certainly more so than cryptography.  
It could also open the door to the creation of a new global currency as an alternative to the dollar, something that Russia and China are rumored to be looking at. 
We sure do live in interesting times—and it is not all that far-fetched to think that OneGram, or another gold-backed crypto currency like it, could be a stealthy way to introduce a new global gold standard. - Forbes

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