FTX and the Age of Fiat Money
In which we see the collapse of FTX’s token as a symptom of America’s abandonment in its own currency of the principles of sound money.
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The best story so far on the collapse of FTX, at least in our view, is A.R. Hoffman’s dispatch in the Sun that marks the drama as a feature of our national experiment in fiat money. After all, if America had a sound currency, one anchored in the classical monetary specie of gold or silver, we wouldn’t have so many young geniuses out there hawking crypto coins and tokens as units of account and mediums of exchange.
What makes the point so devastating right now is that while the collapse in the value of FTX tokens, known as FTT, is breathtaking, it is no more breathtaking than the collapse over the past 50 years in the value of our own government’s Federal Reserve Notes. The collapse in the value of the dollar might have been more gradual, but since 1971 the greenback has shed 98 percent of its value, as has FTX’s token in the recent debacle.
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