It is hard to know how long a fiat currency will last. Many fail due to inflation, assimilation, monetary reform, war or simply lack of confidence. While some, such as the British pound, have been around for hundreds of years, but the average life expectancy of a paper, or fiat, currency is estimated, by some, to be 27 years.
By contrast, gold is seen as the world’s oldest currency because it has kept its value over millennia. Every paper currency is subject to manipulation by central banks and governments who can cause inflation by changing exchange rates, quantitative easing or increasing the amount of money they print. It is not possible to do this with gold because you cannot increase the amount available. While the price of gold changes all the time, gold has never inflated in the same way a paper currency has. Additionally, it is ‘sound money’, meaning it is physically backed by the value of the metal itself, as opposed to paper money which, many would argue, always deflates away to the base value of the paper it is printed on.
For this reason, gold is seen as the ultimate hedge to offset the risk of having paper money. This not only applies to saving gold but to using it as spendable money too – something that it is now possible for everyone to do.
Sign up to get the latest Glint news
Receive the GLINT newsletter with the most popular content, platform updates and software guides.