Fiat currency: between tradition and digital revolution 🌍

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Fiat currency? It's money that derives its value simply from the authority that issues it. No gold behind it. Just trust. In September 2025, almost all countries use it. For everything.

From Ancient Origins to Global Adoption 🏛️

It all started in China. 11th century. Sichuan. Paper as money. Then Kublai Khan in the 13th century established a real fiat system. Fascinating. The crazy spending and hyperinflation eventually destroyed the Mongol Empire. Irony of fate.

Europe fumbled. 17th, 18th centuries. Not always brilliant. The great shift? 1972. Nixon abandons gold. Just like that. The world follows. Our current system is born.

Fiat vs Gold Standard: Question of Control 🏦

With gold, each bill was worth metal. Not anymore. Governments decide. In 2025, central banks maneuver the rates, play with the economy. It works. Sometimes.

The dollar is doing well. It is rising against the euro and the yen. The Fed is keeping its rates between 4.25% and 4.50%. Inflation remains a problem. We seem to be coping with it.

Advantages and limitations of the fiat system 📊

Advantages:

  • Flexibility in case of crisis
  • Not limited by gold mines
  • Cost-effective to produce
  • Facilitated international trade
  • More convenient than carrying gold

Disadvantages:

  • Value based on nothing tangible 📉
  • Risk of hyperinflation. Always.
  • Historical collapses that make one think

Fiat Money vs Cryptocurrencies: The Clash 🔄

September 2025. The confrontation is in full swing. Neither has gold behind them. But everything opposes them.

  • Centralized vs decentralized: governments vs blockchain 🔗
  • Creation: infinite for fiat, limited for Bitcoin
  • Nature: crypto ignores borders, its transactions are etched in stone

The EUR/USD reaches 1.1772. A record since 2021. Markets are stirring. Changes are in sight for the end of 2025.

Toward what monetary future? 🚀

Bitcoin didn't necessarily want to kill fiat. Just to offer something else. A distributed network. An idea. The crypto market remains turbulent. Yet it is growing.

Emerging countries' growth is slowing down. 2.4% annualized for the second half of 2025. Kind of surprising. Their central banks are lowering rates despite the Fed. Risky strategy.

The history of fiat reveals its fragility. Perhaps this is why so many people turn to cryptos. It's not entirely clear if one will dominate the other. A fairer system? Possible. The future remains unclear. The two worlds continue their dance. 🌕

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