Does anyone out there remember that money wasn’t always debt?
Today those hundred dollar bills that celebrities flaunt on Instagram aren’t the same kind of money that existed before 1971. Almost 50 years after moving away from the gold-standard money has become debt and nothing more.
The machine that fuels the debt engine is known as “fractional reserve banking,” and it’s been widely adopted by almost all global currencies. The Federal Reserve creates the US Dollars backed by debt; Euros are debt that has been approved by the European Central Bank (ECB) and so on. For almost half a century there has been no practical alternative to using debt as your money, but with the advent of the blockchain, everything changed. But despite Bitcoin and Ethereum gaining notoriety, most “cryptocurrencies” are still lacking an essential feature of sound money.
See, the thing is, both Bitcoin and the US Dollar are forms of fiat (‘fiat’- a Latin word that means ‘let there be’) currency. A central bank issues one, the other is issued by an algorithm that operates across a global network of decentralized nodes. While different in their architecture they both share the same truth – Bitcoin, and central bank fiat currency are both ‘made up money.’ Their value isn’t inherent other than that people have agreed that it “has” value. It’s this fact that creates the wild volatility that bitcoin is known for.
However, by harnessing the engineering and security of blockchain, AGX has the opportunity to restore real value to our money through one of the oldest currencies in the world – Silver.
The Silver Powerhouse
There are numerous reasons why silver makes sense as an asset class. Firstly, it is consumed in massive quantities by modern industry. Silver is one of the metals that makes advanced electronics possible. It is also used in many other vital technologies, which means there is always a buyer for people that have silver to sell.
Silver is also no stranger to being currency. For most of human history, silver was money. We’re talking all the way back to the Egyptian empire. It probably would still be used as currency if the US didn’t phase out the currency supply in the latter half of the 20th century (1971).
Additionally, while silver has essential value, it also isn’t scarce. This might sound odd, but because silver is readily accessible, inherently valuable, and less expensive than gold, people everywhere can get access to silver and become a part of the system with little economic barriers in place.
Lastly, Silver and gold are also inflation resistant and offer everyday people an insurance policy against a monetary experiment that is only around 50 years old. For now, the world continues to accept western debt as money, but should political and economic climates shift (like in Venezuela for example) that money can become worthless in the blink of an eye.
Now is the Time
Truth is Fiat currency doesn’t have a great track record when it comes to holding its value. The US Dollar has been one of the most stable currencies over the last few decades, but it has lost a substantial amount of value when compared to commodities. When President Nixon abandoned the gold standard in 1971, the price of gold was $35USD/oz.
Now gold costs a little less than $1300USD/oz.
AGX Pay is bridging the gap between the security of precious metals and the convenience of a digital payment platform. By working with the LODE community, which has substantial amounts of silver in registered vaults, we can offer a digital token that is backed up by real silver, and allow people to return to using sound money that’s debt free.