Groceries cost more, rent went up, and our savings buy less than it did just a few years ago. Most people blame politicians, corporations, or the economy in general. They’re not wrong, but they’re looking at symptoms, not the root cause. The root cause is the money itself: Fiat.
This article is for educational and informational purposes only. It does not constitute financial advice. Full disclaimers.
What is Fiat Money?
Fiat is a Latin word meaning “let it be done.” Fiat money is currency declared to have value by authority. Euros, dollars, pesos, yen, every currency on the planet operates on this principle. It isn’t backed by gold, silver, or anything physical; it hasn’t been since the 1970s. Fiat money is backed by our trust in the institutions that issue it.
Three main entities create this money. Governments, through subsidies and public spending. Central banks (the banks of banks) which print money and issue debt. And commercial banks, our banks; which are actually the largest creators of money in the system through fractional reserve lending. For example, when you deposit $100, your bank could lend out $900. The person who receives that loan deposits it in their bank, and the cycle continues. Money is created from debt, endlessly.
Since 2020, 40% of all US dollars ever in circulation were created.[2] That’s not a typo. In roughly four years, nearly half of all dollars that have ever existed were printed into existence. The European Central Bank did similarly, as did most central banks around the world. The justification was economic support during the pandemic, but the consequences are what we’re living with now: rising prices.
Why Everything is More Expensive
Think of sand on a beach. If someone tried to sell you a handful of sand while you’re standing on the beach, you’d laugh. Sand is abundant. It has no value in that context. But if they found a diamond in the sand, that’s a different conversation.
Scarcity drives value. Abundance destroys it.
Money works the same way. The more money in the system, the less each unit is worth. But we still use it, so where does the value go? Abundant money flows into scarce assets: Housing, land, food, healthcare, stocks… Everything that people actually need or that holds real value gets more expensive. That’s inflation. Not the 2% the news reports. The kind you feel at the grocery store, at the gas station, in your rent; the real numbers that are in the double digits.
In 1996, $20 could maybe fill a grocery cart. By 2016, it bought half a cart. Today, maybe a quarter. The number on the bill didn’t change. What it buys did. That’s purchasing power, and yours is shrinking every year.
A Game Where Everyone Loses
The current system creates two classes. Asset owners, whose wealth increases as money floods into the things they hold, and wage workers, whose purchasing power erodes as prices rise faster than their income. The 18th-century economist Richard Cantillon identified this: Those closest to the money printer benefit the most. Today, the top 1% hold 48% of global wealth. The bottom 53% of the world’s population hold just 1%.
But even asset owners aren’t winning. If you own property, your house doubled in nominal value, but so did the cost of everything else. The ruler got shorter. You didn’t get wealthier. You’re still on the treadmill, managing investments, watching markets, trying to stay ahead of inflation. It’s a more comfortable version of the same hamster wheel, but it’s still the wheel.
That’s because fiat is a zero-sum game. For someone to gain, someone else has to lose. It keeps everyone in survival mode, trading finite time for infinite paper that buys less every year. And unlike taxes, which (for the most part) we technically vote on and can see, inflation is a hidden tax. We do not vote for it at all. We’re told it’s 2% but we know it’s far more.
Gold & Silver: The Right Instinct
Take a 20€ bill to the United States and try to buy something. It won’t be accepted. Take a $20 USD bill to Germany, same result. The paper is the same. What’s different is the belief behind it, enforced by laws and institutions. If money is just a belief, then we can choose a different one.
For thousands of years, gold and silver served as sound money. They’re scarce, they can’t be printed, and if you hold them yourself, there’s no counterparty risk. If you’ve been stacking metals, you understood something about money that most people still don’t. That instinct is correct.
But gold and silver have real limitations. They’re hard to verify without tools. Hard to divide for small transactions. Difficult to transport in any significant quantity. They cannot be instantaneously sent to someone else across the planet. And history has shown that gold always gets captured by the system it’s supposed to protect against. Executive Order 6102 in the 1930s made it illegal for Americans to own gold. The government seized it from bank vaults and revalued it. At scale, gold requires trust in custodians, vaults, and institutions, and that trust has been broken before. For 5,000 years, trust in sound money has always eventually been broken.
Gold and silver are still within the zero sum game and always get captured. We need something else.
A System Outside the System
Bitcoin is the first monetary system in history that doesn’t require trust in a central authority. There are only 21 million that will ever exist, enforced by mathematics, not by decree. No government, no CEO, no company can change that number.
It’s decentralized. Individuals around the world run copies of the Bitcoin network on their own computers. No single entity controls it. China has tried to ban it multiple times and failed every time because the network kept running in every other country. During the Canadian Freedom Convoy in 2022, the government froze bank accounts of citizens who donated to a legal protest. Bitcoin transactions continued because no one could stop them.
When they teach you about money in school, they talk about properties like divisibility, portability, and durability. What they don’t mention is trust. Trust is the single point of failure in every monetary system we’ve ever had. Bitcoin is the first one that removes it from a central authority, that history has shown will violate that trust. That’s what decentralization also means: No single entity to trust.
And something remarkable happens when you measure prices in Bitcoin instead of fiat. An iPhone 4S cost 162 Bitcoin in 2011. An iPhone 16 today costs a fraction of one Bitcoin. A better phone, for less money. In Bitcoin, prices fall over time. Technology makes things cheaper, and Bitcoin aligns with that natural deflationary force. Fiat fights against it because the debt-based system requires inflation to survive. Those two forces are in direct conflict, and that conflict is accelerating as AI drives costs down across every industry simultaneously.
Bitcoin is the opposite of the zero sum game; its an infinite game.[1] But most people are not deep enough down the rabbit hole to see this yet. So what can we do to walk through to the other side?
The Modern Sovereign Money Stack
Sovereignty can come in layers, just like preparedness in any other domain.
- Cash in small denominations covers short-term daily needs. It’s losing value, but it’s still the most widely accepted medium of exchange. Having small bills and coins on hand is practical, especially if digital systems go down. Most people will not have change readily available.
- Gold and silver in small denominations serve local resilience. Within a community that knows and trusts you, metals can function as money in a crisis. They’ve done so for millennia and they’ll likely do so again during any transition. But the trust already needs to be established or trade will be made very difficult (they will naturally want to verify your gold/silver is real).
- Bitcoin is the long-term layer. Permissionless, borderless, divisible, and transportable in your head if necessary. Twelve words is all it takes to carry your entire savings across any border.
Cash and metals are temporary solutions within the existing system. They help us navigate the transition, but they don’t solve the underlying problem. Bitcoin is the first discovery in 5,000 years that actually exists outside fiat. Gold got the principles of sound money right. Bitcoin is those principles fully realized, without the trust problem.
The Door is Open
For 5,000 years, the same cycle has repeated. Sound money gets created, it gets captured, it gets debased, the system collapses, and it starts again. For the first time, there’s a monetary system that can’t be captured because it doesn’t require trust in anyone.
Bitcoin is not about getting rich, its about true sovereignty. What happens when survival mode ends? A new experience emerges; instead of “how do I make more money” the focus is more on “what am I actually here to do?” The fiat system doesn’t just steal purchasing power, it steals our time; our life-force energy. Our truly most precious and scarce asset. My invitation isn’t to buy Bitcoin. It’s to keep pulling the thread. Challenge everything I’ve written here. Try to disprove it. That’s how most of us got here. If this resonates consider getting a copy of my book Beyond Money where I go much deeper.
Sources
[1] Booth, J. (2020). The Price of Tomorrow: Why Deflation Is the Key to an Abundant Future. Stanley Press.
[2] Federal Reserve Economic Data (FRED). M2 Money Supply, 2020–2022. Approximately 40% of all US dollars in circulation were created between 2020 and 2022.