Episode 160-Evolution of Money and Economy-2!

Welcome to Crypto Nights where we help you finally make sense of the trending world of crypto currencies. So gather your virtual piggy bank and let's get started. I'm talking about the modern bank in Europe. Yes, there are many forms of banking before because there are civilizations where before that, right? Like you talked about green. The problem with all those things is they're expiring it. Green and

life, right? And they just sit there. They gather some dust and some rust. But oxidation may be, but they do sit there for a long time. And gold, by the way, is more durable than other things. And that's what very precious, the characteristics of gold, right? The durability. The fact that it doesn't lose its shine, maybe it just dust it off, polish it, and gold is

gold, right? So gold has its peculiar properties as a metal. And that's what made it attract. It looks good. It's the specific gravity, you know, that is correct, you know, like and relative to other metals, right? It's comfortable. It can be gives it easily. It can measure in final quantities and broken into faster. It can be merged back. And it won't to show off your wealth.

It's only asset. You can actually get on your body, right? I don't know. I don't know how good it is to carry my bags of grain everywhere to show. So there was a, there was a showing off also. So a lot of things came together to make gold what it is more than a belief. So it was a, it was a, it was natural process of

the market. And that's why I used the metal as an example. I'm not bringing a lifestyle. And the specific gravity was a very important point. That's what helped you determine whether this was real gold or not. Correct. It's easy to determine that. So that was important. See, the, each of these forms of current and see have their own characteristics. There are some drawbacks that naturally come

with them. So given your specific gravity idea, it's easy to determine for an expert, I would imagine, that what you're giving me is a bar of gold and not of half a bar of gold and half a bar of copper combined in some intelligent way. It's very easy to make out the difference in specific gravity. Somebody did that. So beautiful. Actually, let me just interrupt you

because it's an excellent point. I can just take a couple of talks about that. So that specific gravity, that property that you know and can be measured is very easy to authenticate. So there's a durability, there's authentication. Right. How do you know this is truly gold and not irritated with something else mixed with something else that's made to look like gold. So it's very easy and

fast. It's very hard to tinker with and adulterate gold. So the specific gravity, the physical properties of gold, made so. So it was very fast check to see the authenticity of what you're getting. So we are now coming up with various characteristics. We are almost drawing up a list of criteria that determine what money is. Right. It should be easy to carry around. That one of

the important things. It cannot be easily counterfeited. At the same time, it's very easy to validate. So you're able to validate that this is really gold. And in case of gold, you don't care. What the heck is counterfeiting me? And if you're giving me a bar of gold worth one pound. Somebody else takes that and gives me another bar of gold. I don't care if you

gave me the same bar of gold. You gave him some some other bar of gold. They're fun. You know, those are amazing. If you list on those characteristics, it's a common sense risk. Easy to carry can be counterfeited. You know, fast authentication. Right. Can be counterfeited easily, but also in case it is adulterated or counterfeited, you can authenticate it and reject it and say, sorry, this

is not what it is. Right. And it's fungible. It's divisible. Fungible. And it's durable. You're able. And it is. Easy to store. Easy to carry. Easy to store. So that you don't require a lot of things. Easy to store. Lay claim of position on it. So these are. We can define like a list of five or 10 items. And what makes money money. Okay. The real

money. I mean gold asset. And then the paper transition to that is the difference difference story. Of course. Oh, yeah. I might wonder. And I was just thinking. And also it can be inflated and produce that fast and produce at will. Of course, there are people all through the history. There was even a branch called alkeny. Right. That's trying to make this gold. Then the funny

thing is, had this succeeded in doing so. Then gold would not be going because the other characteristics. It should be hard to produce at will. That means I just can't. They spend an hour and produce all this stuff. All this gold. And if I can, if I do so, then everybody will be doing it. And then they're inflating it. And then it loses value because that's

not a property of a currency for exchange. It has to remain more or less stable in supply in the marketplace. More or less. It should be much harder. You need to spend more money. To dig up and make it. If you want to buy a bar of gold, a ounce of gold, then you would spend it buying it in the marketplace or somebody. So that's a

kind of thing that makes it not worth for us to go out and just dig in sand everywhere. Forget the California gold. Gold rush. But other than that. Many after some time, it's very stable currency. It has to be. It can be inflated or produced. That is it. Yeah. That's it. Is it a mix? I was saying that is easy to carry. It cannot be easily

counterfeited. Obviously, it has to be. There has to be a common story. It has to be popular that everybody reteknizes it and admits it as an exchange of value. It's durable. If it gets wet or is it fired, it should still survive that. It should be something that you can store and safeguard. And you know, it'll be good also if we can somehow prove ownership. If

the ownership. That's why some of these are not good with gold, a bar of gold. If I had it and I gave it to you, there's no way to prove the ownership of a bar of gold. And then you went to paper. Paper in many ways is better. It's easily carryable. More easy to carry than a bar of gold, which is heavy. But the problem with

paper is. Now you have a host of other problems. Number one is it. Maybe it can be counterfeited. Maybe it can be destroyed. Maybe it can catch fire. And if government took over, then the danger that the government is only one that can print more of these causing inflation and causing the value of what you put under your mattress. I don't know why we always say

put money in the mattress. Maybe that's where people used to write money. I don't know. But putting people. The money that is so called safe when the mattress is no longer safe because somebody is printing more money. And the value of the money you had became half. And like you said, hard to produce at will. So a bar of gold. I like the Alchemy example. They

were, I mean gold became so popular, so famous, so valuable that people thought, boy, can I take some of these base ones and take some copper and produce gold. So luckily, that was not possible. So. And the funniest thing is it does not have to, the governments of the world are under this illusion that they have to approve currencies. I don't get it. Because you have

a bag of potatoes. I have a bag of tomatoes. I say, hey, I'm going to give you some tomatoes. Can you give me some potatoes? And I give it to you. And I take it from you. And then tomorrow, there'll be headlines. The government proclaims that tomatoes are not legal tender. And then everybody is like sweating. Oh my God. Can't use tomatoes to buy potatoes and

tomatoes guys from now on are not legal tender. And if I'm interested there, you know, they can, states can say what they want. But they cannot override demand in the marketplace. It will find its way. And when some countries up their tariffs and barriers to. Three floor goods say. Then goods will flow anyway. Demand will find its way to get fusion in the marketplace. And then.

The governments will call that such activity illegal and the call it smuggling. Okay. So smuggling is not smuggling. It's a trade. So now we get into moral connotations and judgment side and take something as smuggling or people say black money in some countries like India. Black money. And what makes money black? Because you're in Texas. But it's currency. So. Yeah. You know, so it's like so

black money and blood money because it was gotten from illegitimate activities. And so somebody traded for a goods and now it had landed in your hands. And from there you traded something else. So how far back is cause in this transaction chain to we go to and why should we? Because the movement. And so this is the problem. One of the other things is ownership is

good, but principality and wanting to know about every pair transaction where this coin came from, right? And that comes with the money laundering stuff. So if and such things are not really natural to the marketplace, it's really think about it because okay, some you know, this is the thing a goods and demand this gold coin, right? Let's start with gold coin because we get confused with

paper, right? And then we know how the jump was made to paper. But let's talk about real money. The asset. That's that's being coveted. Even the back even the dollar bill till 1973. Right. Right. It's far of gold. So if you take the gold coin, everything becomes clear, the coin, the coin age. So if you take a metal coin, gold, say, and so it was exchange

several times in several transactions. Why is it your moral responsibility? To see the the first trade or some kind of trade that's not approved by some people in between. So a moral judgment says somebody used it to somebody's producing a particular good or a service that you don't approve. Okay. We can think of any services, right? You know, to people talk about the oldest professional level.

Okay. So people talk about the things and there's a strong moral connotation. Some people, at least some people say, hey, I don't care as long as you know, it's consensual people are adults. So people have all of the age moral views on this side. Let's say there was a gold coin that somebody got an exchange for a service as such. Okay. I call it service to

keep it professional. Okay. So, and so to make it morally neutral. Okay. So an exchange for service, this person got this coin. And now he actually went out and bought something else with that and his coin landed with somebody else. And somebody else bought something with that and his coin landed with somebody else. So finally it came to you and I and so is it our

responsibility? Is it necessary? Is it does it? Does it have any utility in us demanding? Where all this gold coin has passed through? Is it our business to do that? As individual accepting it? No, I don't think so. Because in that case, everyone has to stop and verify every transaction in the world from the beginning of time. And any time you're going to get a new

coin, you're going to get a new coin. Any time it doesn't fit with your moral compass, such transaction, it has to be stopped and we can accept it. So this is, I've seen some, you know, if I make a jump here, I don't want to make such a complex jump, but I have to. If people talk about organic produce. Okay. In the supply chain and okay,

and they say, okay, this product that I'm consuming, I can understand. Keep in track of the organic nature of the goods. Let's say I go to Walnut. And buy something I want to check and people have proposed blockchain as a great example, a supply chain, rather pleasability, right? Where it was produced and finally this goods landed. Yeah, I can verify. I understand that because that's something

I want. But then people have brought in their moral compass so much in the recent times that they want to know the factory that produced this goods. Did they employ child labor? Where they have proper moral value? Where they are? So you see how complex it becomes when you ask for this chain, you can never buy a single product anymore in your life. From anybody, because

some there along the chain in supply chain of production of this complex goods. Okay. Somebody did not fit your moral, your moral views, did not subscribe to moral views or violated your moral, your ethics introducing that. And it becomes really, really hard. But people are trying to do that. So there are legitimate users in supply chain, right? For blockchain and I know I'm introducing a candidacy

topic here. And they're, they're like nonsensical use cases for this and people are confused and we'll be constructed maybe in a later episode. But when they get back to this. So when people say black money, this money, and traceability, white traceability, then you can authenticate a piece of gold, a coin as the proper payment for the goods that you gave, delivered to somebody and they gave

it to you. And do you want to know who their grandfather killed? To get them. Okay. And what is it? Was it a legitimate fight for? It's different. That is grandfather killed somebody or was it? It was murder and a criminal. So who makes a judgment by the way? Do you have the time in a marketplace, a marketplace, freezes if people do that? So money unnecessarily

has been tainted. Black money, dead money, you know, I've never seen any of those colors. I've only seen green dollar bills. Right. Right. Even the ones that are black dollar bills are green dollar bills. Even the blood money is green dollar bills. Yeah. Exactly. So what I'm saying is, I'm taking a morally neutral view because economics has to be decoupled from your political views or your

ethical views. Or whatever you have because, you know, otherwise you can't take this traceability back and back. Otherwise, economic activity freezes in the marketplace. So that's exactly the prostitution example. Right. In payment and the payment goes to somebody else. So I just want to put it out because today it's possible to track transactions. But we want to should be. www.cryptonives.io.