Why do people seem to trust fiat currencies so much, despite being nothing but pieces of paper? Because state authorities guarantee that his paper is real money that you can store, exchange, or use to pay for goods and services.
We believe that it's nothing but a force of habit. It's been too long since the last crisis that would really devalue the currency of a major country.
Of course, we remember that inflation in Germany reached millions of percent after the First World War — but this happened long ago. Of course, we know that the currency of Zimbabwe was recently devalued by a factor of millions – but it's a state that’s been ruled by a dictator until recently. And yes, we see that Venezuela – another authoritarian state – is going through hyperinflation right now. But all this happened or is happening in autocratic countries and can't possibly happen in a civilized state – this is the mantra that we repeat to ourselves. A short historical overview
Fiat paper money has only emerged recently. For thousands of years, people used all kinds of items and goods as a means of payment – cowrie shells, gold, copper, bronze, spices, and so on. If at some point, a certain item became too plentiful, its price would fall, and you could therefore get fewer other goods in exchange for it – and vice versa.
With time, people realized that paying in cowrie shells, metal bars, or something that could go bad or moldy was too complicated and costly.
As with many other issues, it was the ancient Romans who decided to solve the problem once and for all. Every new emperor or dictator made sure to mint coins with their face on them. If there wasn't enough fresh metal available, he would just take coins minted by his predecessor, melt them and make new ones.
It's from that point onward that we can track the key problem of fiat money – its constant devaluation.
For instance, in early 1st century AD, Romans used denarius – a coin made of pure silver. Just 40 years later, during the reign of Nero, a denarius contained only 94% of silver – and by the end of the century, its silver content fell to 85%.
What was the reason? Nero and his successors used this trick to pay less to their creditors. In 2nd century AD, there was less than 50% of silver left in a denarius. In 243, Emperor Philip the Arab reduced the silver content to just 0.05%. After the fall of the Roman Empire in the West, a denarius contained only 0.02% of silver.
This way, over the course of roughly 200 years, the inflation of denarii reached several thousand percent. But if we study more recent examples – say, the real value of the US dollar or pound of sterling in the last 200 years – we'll see a similar picture. A forecast for the future
Let's go back to the question we asked in the beginning of this article. Why do people trust fiat money?
In the past 70 years, we haven't seen any major wars involving developed countries that could radically devalue their currencies. There haven't been any major natural disasters that could seriously damage the economy, either. Sure, such things keep happening in third-world countries, where currencies lose their value due to military coups, uncontrolled printing of new money, and so on.
If you ask the population in those third-world countries that have been through hyperinflation how they feel about their fiat money, you'll find that their opinion is just the opposite of that shared by people in the West.
That's why gold and jewelry are so popular in the Middle East, and that's why US dollars are in such demand in Latin America. Nobody wants to keep their savings in the local fiat currency – because its long-term stability cannot be guaranteed. Gold is a great way to store value, especially when fiat currency is devalued rapidly for no reason.
Here's a simple example. Let's take country Z with a stable economy and equally stable fiat currency. Bob keeps his savings in a deposit account and earns a 5% annual interest. Alice uses her fiat savings to buy physical gold and then either buries it in her garden or stores it in a bank vault.
A disaster strikes: a military coup, volcano eruption, flood – you name it. The fiat currency of Z loses most of its value in an instant. And if the government decides to print more money (to pay for disaster relief or as a populist measure), inflation can quickly reach astronomical heights.
Bob's savings will be worth nothing – but Alice won't lose anything. If local fiat money is devalued by a factor of 100 relative to the US dollar, its exchange rate relative to gold will fall by a similar amount.
Any educated person can understand this – but why are so few people actually buying gold to protect their savings? And why do the majority of people take their money to the bank, even though generations after generations have lost their bank deposits?
There is only one issue with storing value in gold: buying it is complicated, costly, and sometimes dangerous. Here we'll cite just a few examples, although we could provide many more:
- In many countries you have to pay a fixed tax or VAT when buying gold, ranging from 10% to 25%. This means you'll lose up to a quarter of your money at once. Not such a great investment, is it?
- The spread between the buying and selling price of gold often reaches 10%;
- Storing gold at home is risky; storing it in a bank vault means paying a fee and can still be dangerous;
- In case of a military coup of natural disaster, if you need to exchange your gold for money, you can easily get killed. Modern-day Caracas is a good example: people are attacked even when they are suspected of carrying around as little as $100. Cryptocurrency to the rescue
In the context of the issues described above, cryptocurrencies are a god-send for people in third-world countries. Crypto helps preserve the value of money and hide it in case of a crisis.
The demand for Bitcoin among the middle class in Africa and Asia is several times higher than in Europe. Why do people prefer Bitcoin and show much less interest in other altcoins? Because the maximum number of Bitcoins is finite. Whatever happens in the world of fiat currencies, even if governments print dozens and hundreds of times more money, new Bitcoins will only enter the market through mining – and over 80% of the total have already been mined.
Bitcoin doesn't belong to anyone. There is no organization or country that can control it. In the 10 years that have passed since its launch, nobody has managed to hack the system – while even the leading IT corporations regularly fall victim to hacker attacks.
The only real problem is that most holders of fiat money and gold bars find it’s hard to accept Bitcoin's volatility. Indeed, if the BTC price has grown by a factor of 100 or 1000, it could theoretically fall by just as much, completely devaluing one's investment. Who would take such a risk?
If only one could invest in digital gold that can't lose its value relative to fiat currencies and free from the risks and complexities of purchasing, storing and selling it that are inherent to physical gold. The future is already here
DIGITAL GOLD is a company that has found a solution to the challenge of money storage. In summer 2019, it launched a new stablecoin which serves the purpose of Digital Gold.
Now, investors seeking to protect their savings won't have to deal with the costs and dangers of buying physical gold. It's enough to purchase GOLD stablecoins, built on the popular ERC-20 standard. In less than a minute, any person anywhere on the globe can buy $10, $100, or $1000 worth of new digital gold.
The tokens will be instantly sent to the buyer's wallet, and the only transaction fee will be the cost of gas. The risk factor is also low, granted that the greatest loss would be losing one's wallet credentials. Exchanging the digital gold back into fiat or another cryptocurrency takes just a minute as well, alongside the gas cost (usually a few cents).
Why do we call GOLD stablecoins, digital gold? Because DIGITAL GOLD has pegged it directly to the price of gold at the ratio of 1 token = 1 gram of 99.99% gold.
The new stablecoin features several key differences from previous projects that claimed to have gold-pegged tokens:
- The number of issued GOLD tokens is equal to the amount of physical gold (in grams) owned by DIGITAL GOLD and stored in a constantly monitored secure vault belonging to BullionStar. Any investor can verify the amount of gold in the vault using the BullionStar audit system at any moment. A total of 7,200 tokens have already been issued, meaning that the company stores 7,200 grams of gold in the vault – a fact confirmed by the BullionStar audit.
- New GOLD tokens will only be issued once a new batch of gold is deposited in the vault. For instance, the company might buy 5,000 grams and issue 5,000 new tokens.
- DIGITAL GOLD guarantees full liquidity of its tokens. The company is ready to purchase any amount of GOLD through its official marketplace at https://gold.storage/market – at any moment and at a price that’s extremely close to the market price of gold.
- If supply seriously exceeds demand, part of the gold can be sold in the commodities market, with a corresponding number of GOLD tokens taken out of circulation.
GOLD stablecoins are a highly innovative instrument that is sure to attract different groups of investors. Those who have always wanted to buy gold but didn't because of the high costs and risks can now invest in gold within a few clicks.
Yet another factor that can prove crucial in developing markets is full anonymity. By contrast, it's impossible to maintain one's privacy when buying, transporting, and storing physical gold.
These and other advantages are bound to make GOLD a preferred investment asset of the future – and each of us can join this future right now.
Website : https://gold.storage/
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I know I said I wouldn't be back here. But after watching the Netflix documentary The Great Hack, I had to say something meaningful. Britanny Kaiser is a school example of an ENFJ. She was political action for the Obama campaign, responsible for the blueprints of modern digital political communication on the platform as Facebook. She then moved on to Amnesty Internaternational, and then as lobbies for United Nation at the EU in Brussels. Beautiful career overshadowed by her Cambridge Analytica employment. The reason why she went to work for an opinion influencing company like CA is that when she needed money in the direst situation. Her father had brain damage, and because of the recession, her family was going to lose the house. When Britanny reached out to those who she helped like the Obama Administration and other humanitarian organization, they did not provide her with any support. This reaction pushed her to the dark side, where you get at least paid and valued for your excellence in people skills. I have been in the exact situation. I have worked on and of for two years a freelance growth hacker for NGO's, start-ups and freelancers. But when you ask something in return, you get 8/10 times nothing back. This selfishness of people drove to the crypto industry where they compensate you're according to your ability to persuade people. I moved out of that toxic industry because of terrible leadership. My ex-boss is in jail, he stole 3.5 million in bitcoins and had the career of a sociopath who has been scamming people all of his life. The next boss I went to work for was even worse. He took a Chinese investment of a couple of millions and last time a check still has not done what he had promised. All of this time, I never took money or signed a contract, because my intuition kept telling something was on. But like any average human being power and wealth does something to your ethics. You feel unstoppable, and an ENFJ will convince himself with these arguments: - People are free to make their own choices - Sometimes you do a little evil to earn money, which you spent one something good. - Everybody is doing it. Why should I prevent myself from eating the pie? I was lucky that my bosses were so psychological warped that I could step out of it. But seeing Britanny struggles, I would probably have done the same with a charismatic boss like Alexander Nix. My point in case that of all MBTI types ENFJ is one of the most dangerous types for the human population when we block ourselves from seeing our truth. We will use our gifts for manipulations of the masses, and try distance ourselves of the ethics. If you are finding yourself in a similar toxic situation. The first thing I would say is breath and meditate. ENFJ's get tricked into sticking to toxic organizations and corporations because of our sense of duty or our belief of changing people. We are at the end of the susceptible to sociopaths, psychopaths, or people without ethics in our darkest days. We can even become kind of dictator ourselves. What I did to solve my ethical problems, was quitting work at all. The intermezzo that followed got me eventually in a full-blown depression. Luckly I have recovered. I write this because of 100% sure other ENFJ are in a similar situation now. Therefore my advice to all of you guys here is sit and reflect if you are genuinely bettering the world or lie to yourself that you do that. If it is a lie, try to switch industry as fast possible, before the toxicity consumes you. Or else you will do things like Brittany Kaiser, which you can never take back and will torture you from the inside for the rest of your life! submitted by
It’s been a decade when the revolutionary concept of online selling was introduced to the world and the evolution of this industry has been exemplary. Within the past few years, the concept of ecommerce has been intensely affected by continuous technological advancements and blockchain is one of them.
Blockchain offers a variety of new opportunities for the industry through its unparalleled potential; eliminating mediators to centralize operations, reducing complexities for ecommerce businesses to resolve their long-term challenges. However, it’s important to mention that this technology is the foundation of cryptocurrency payments which makes it more important for the e-commerce domain. It would be appropriate to say that blockchain is poised to change the way transactions are made. In continuation, both traditional selling stores, as well as e-commerce businesses, should be prepared for radical changes. Our focus will set on analyzing the impact of blockchain technology on e-commerce businesses in coming future. But prior, we need to clarify some important questions about the Blockchain technology. Those buzz will be helpful for you to spend on the services of a professional shopify development company
in an effective manner. What is E-commerce Blockchain?
A traditional ecommerce store always has a large number of customers, inventory and transaction data, which requires adequate management & storage for effective results. In blockchain technology, this situation is addressed by combining transactions in block form and connecting those blocks in the form of a chain. Here every block is stored on individual computers hereby making it secure & scalable. How are Blockchain transactions verified?
Transactions in Blockchain has a legitimate process of verification. Every node has a complete history of transactions and whenever there is a new happening transaction, the node performs several checks to ensure that it’s a genuine one. The process starts with a signature validation and if not valid then gets denied promptly hereby making it impossible to falsify the authenticity. Hiring a professional developer is most suitable if you are new to Blockchain technology integration.
But prior to having a look at the unleashed potential of blockchain for the e-commerce industry, it’s required to understand the potential challenges and pain points it faces. The survival, sustenance and growth in E-commerce is difficult due to its complexity as a domain and to start here is a challenge in itself. Let’s have a look at some of the key challenges faced by the sellers on a day-to-day basis as well as in the long run.
The e-commerce industry is becoming highly competitive, with existing players offering similar products and services and more sellers are joining the bandwagon at a rapid pace. It requires businesses to adapt smart business models & technologies to sustain in the race. Another pain point of the sellers is the presence of a middlemen in traditional business models who shares a hefty percent of earning in the selling process. Also the sellers have to pay a transaction processing fees to facilitate payments for completing the transactions. This fee reduces the profits of sellers to a considerable extent and result in lower revenues.
Another key concern for these businesses is the protection of consumer data as they require to build the customer’s trust by assuring them about the complete safety of their personal as well as financial details. The implementation of data security regulations; General Data Protection Regulation (GDPR) has made data security an important concern for ecommerce companies. This is prime reason for sellers to invest more in data encryption and other measures for preventing hacks.
There is an array of operations like supply chain, logistics, payments included in ecommerce business and management of these operations is a key challenge for the industry. From correct inventory replenishment, proper arrangement of shipping and delivery functions, to managing customer relationships are few of a lot things needed to be managed by the merchants.
And since all these challenges can be overwhelming the sellers from very start of online selling, they have been searching for a technology that’s capable of handling them all. Fortunately, blockchain technology is a suitable answer for all these questions and being a decentralized system, it offers a lot of benefits for the e-commerce domain. E-Commerce Will Be Driven By Blockchain In Future
Regardless of all the positive impacts e-commerce industry has on the world economy, things have not been fruitful for the sellers in the domain because of the challenges since the origin. Also, it has been seeking for a secure technological backbone to support it and address the diverse challenges it faces. Luckily, the Blockchain technology is ready to give it the same today through an array of features: Operational Efficiency:
The decentralized model in Blockchain makes it capable of assigning operations and drive efficiently. Smarter contracts are passed down to regulate the intermediates like logistics and payment processing partners. It facilities the integration with several management systems to streamline the overall workflow as well. Blockchain offers the clients complete ownership of their assets like digital storefronts, product photos, and videos, and reviews. Assured Payments:
Another significant advantage is the transparency in transactions, which increases a buyer’s trust. Every transaction is taped in a shared ledger which cannot be modified by anyone. Users avail high-security, faster processing speed, and radical visibility along with traceability through decentralized system. Also cryptocurrencies lower the transaction costs for international e-commerce stores. Cost-Effectiveness:
Bitcoin is a well-known and most utilized case for this technology. Online sellers can trust bitcoin and other cryptocurrencies to get in-budget payment solutions and since there are no payment processes involved, currency can be accepted at a zero processing fee by the sellers. Additionally, blockchain offers a decentralization of marketplaces, letting the inherent costs going down automatically. It also provide better pricing for online retailers for the customers as the savings are passed to them. Data Security:
Consumer data of an e-commerce store is always on a vulnerable point due to weak encryption, since well-encrypted systems can be hacked by the tips and tricks used by modern hackers. The presence of a decentralized ecosystem makes it impossible to hack from a single point, enabling sellers to safeguard the sensitive customer information and databases. Conclusion
Since there are extensive benefits of e-commerce Blockchain making it imperative for businesses to grasp for massive growth. If you require transparency in business transactions and manage your consumer data reliably, this technology is the best solution for you.
Having a right technology partner is must for you to use this futuristic technology at fullest and take your business to the next level. At Pro Web - Unisys
we develop robust e-commerce solutions to open unlimited opportunities and take your e-commerce business to the next level. Blog Source URL: https://www.prowebtechnos.com/how-blockchain-e-commerce-makes-a-successful-combination/