Currency lads

Before currency there was simply trade and barter. And since then there have been three generations of currency.

The first currencies were shells, metals, coins and finally promissory notes – all based on the trade of physical goods.

As our modern economies have become more productive and our wealth more tied to services, we have tried to morph promissory notes into something related to the value of services. We have done this by letting go of gold standards, making the things simple float and sort of controlling how many we print or put into virtual accounts in the reserve banks of the world. This is like sticking a very square peg into a very round hole – it simply isn’t working very well and will get worse.

What we need now is a currency system specifically constructed and pegged to the value of first world services. Bitcoin, strangely, is a first attempt at this although this wasn’t the intent of the authors – their intent was to move away from central government controls.

By the time we have this it will undoubtedly be obsolete as we are already seeing the beginnings of virtual money which is tied to units of trade (goods and services) that are entirely virtual, e.g. in massive online gaming. As we continue our slide into a Matrix-like existence, with more and more of our time spent looking at displays, this online virtual currencies will become the most important.