What Is Money?


The purpose of money as a conceptual tool is to facilitate easy trade as a medium of exchange. It functions as a unit of account, store of value & social power. Mankind's greatest invention wasn't electricity, the internet or even AI. It was money. It's the most influential technology allowing us to divide our labour and exponentially increase our productivity and quality of life.

Imagine living with a primitive jungle tribe. No insulated housing, electricity, internet, phones, tv, computers, books, etc. It would be a death sentence for most of us. We'd probably die of boredom before anything else! Money enables us to properly survive as humans qua humans, that is, as rational and intelligent beings. It's the lifeblood of civilization. We can exist without it, but we can't live.

Money allows fair and voluntary exchanges significantly easier than barter. Imagine trying to trade chickens for petrol, furniture or groceries—it's impractical. Money serves as a convenient & universal medium of exchange.

Money also functions as a unit of account. Without it, how many chickens would you need to trade for a cow or a tomato? With money, a cow costs $1,000, a chicken $20, and a tomato $1.50. Think of money as a measuring stick of value: the higher the price, the more "valuable" the item. This function helps us quickly identify differences in value.

Money acts as a store of value. Unlike tomatoes and aging chickens, which devalue over time, the cash in your wallet and bank lasts. However, fiat does lose value due to inflation, making it less than ideal as a store of value.

Money is a social power of influence. It allows you to persuade people to act in your favor, whether by outbidding someone for a house, traveling the world, hiring an army or swaying political decisions. Money grants you the ability to achieve things that would be impossible without it, functioning almost like a superpower. It's a double edged sword as it can be used for tremendous good and horrific evil.

Because of this, it's imperative we have the most individualistic, fair, unbiased, private and sovereign money we possibly can. Lest all the social power flow to the wrong hands, as it always does with "bad money".

Gold, silver, btc, fiat and FC are not intrinsically "money". They're used AS money. Money itself is conceptual, only existing in our mind. Gold and silver are metals. BTC and digital fiat are computer codes. Cash is paper. They're symbols we USE as money. Currency is the physical or digital item which represents the idea of money.

In the past, gold and silver were treated as currency and a common medium of exchange. Today, they're not really considered money, but an investment asset or commodity. Ideally they don't become currency again because they're impractical in today's digital world. This is where The Freedom Credit steps in as the latest upgrade to humanity's greatest technology


Purpose, Functions & Characteristics

Medium Of Exchange - Social Power - Store Of Value - Unit Of Account - Divisibility - Fungibility

Whether a currency is good or bad, physical or digital, limited or unlimited, it must have the below purpose, functions and characteristics to qualify as money.

Purpose

1. Medium Of Exchange (Facilitate Consensual Trade)
Gold & Silver - In the past it was high, today is low | 0.5 points
Fiat - High, it's used everywhere by everyone | 1 point
Crypto - Low, many crypto's are viewed as assets and aren't traded | 0.5 points
FC - TBC, aimed to be higher than fiat | 1 point

Functions

2. Social Power (Ability To Influence People) No points are awarded
Gold & Silver - Medium-high, it represents great value and is hoarded by a very few.
Fiat - Very high, it's created and controlled by a very few.
Crypto - Low-medium, isn't widely accepted or used as a MOE.
FC - Medium-high, has the potential to be socially powerful, but in an unbiased & fair way.

3. Store Of Value (Does It Hold Value Over Time)
Gold & Silver - High, the value of gold and silver has continued to increase over time (when measured with fiat). | 1 point
Fiat - Medium, your $50 note will buy you the same amount tomorrow as it will today, but over time, it does generally depreciate. | 0.5 points
Crypto - Medium, crypto is volatile as its value is based on whatever the market is willing to pay, it can be risky and is typically a fluctuating store of value. | 0.5 points
FC - High, Credits have a fixed purchase price and appreciate the more it's used. | 1 point

4. Unit Of Account (Standard Of Measurement / Easy To Use Numbers)
Gold & Silver - Yes, works via weight | 1 point
Fiat - Sometimes | 0.5 points
Crypto - Rarely | 0.5 points
FC - Yes | 1 point
Example: Loaf of bread may cost 10,000 Vietnamese Dong, $3 AUD, 0.00004 Bitcoin, 2g's of silver or 2 Freedom Credits.

Characteristics

5. Divisibility (Can It Be Broken Into Smaller Units)
Gold & Silver - Low, gold is too high value and impractical for small transactions (21st March 25, 1g gold is $154 aud) Medium, silver. | 0.5 points
Fiat - High, cash & coins. Digital even better. | 1 point
Crypto - High, bitcoin is extremely divisible with 8 decimal points eg. 1.48568419. | 1 point
FC - High, uses 3 decimal points. | 1 point

6. Fungibility (Is Each Unit The Same Value)
Gold & Silver - Yes, each measurement by weight (gram, ounce, kilo) of the same standard (20karat, 24karat) is worth the same amount as all the rest. | 1 point
Fiat - Yes, all fiat whether cash or digital is worth the same as all the rest. A $100 AUD note is worth the same as all the other $100 notes. | 1 point
Crypto - Yes, all units of a particular cryptocurrency, eg. bitcoin, are worth the same. | 1 point
FC - Yes, all Credits have the same value as each other. | 1 point

Points As a Good Money
FC - 5 points
Gold and silver - 4 points
Fiat - 4 points
Crypto - 3.5 points


Qualitative Aspects

Scarcity - Liquidity - Acceptability - Durability - Portability - Non-counterfeitability - Centralisation - Inflationary - Intermediaries - Stability - Fees - Custody - Format - Controlability - Ease Of Use - Exchangeability - Identity - Speed - Ledger - Sovereignty

Qualitative aspects determine the value, desirability, usability and overall quality of a money. The more points a currency has, the better it ranks as a "good" money. A good money is the currency which ranks the highest in the time in history it is being scored. As of today, the concept of The FC scores the most points as what constitutes as a "good" money. It remains possible that an even better money is created in the future, but this is the best we can build with the technology and ideas we have today.

1. Scarcity (Is there a limited amount)
Gold & Silver - No, approx 6% gold and 4.2% silver increase p/y. | 0.5 points
Fiat - No, can make as much as they want. 2020-2022 resulted in 41% more USD's. | 0 points
Crypto - Yes, most crypto's have a cap (btc is 21 M). | 1 point
FC - Yes, has a cap (10 T) | 1 point

2. Liquidity (Ease and speed of conversion into other forms of value as goods and services)
Gold & Silver - Medium, most people don't trade with it and normally only specialised dealers exchange metals for fiat. | 0.5 points
Fiat - High, most liquid form of money. | 1 point
Crypto - Medium, need a KYC central exchange to trade into fiat or a higher risk and fees decentralised exchange.  | 0.5 points
FC - To be determined, aspiring to be higher than fiat (because of world wide use). | 1 point

3. Acceptability (Do people accept the money as a means of exchange)
Gold & Silver - Low, most business's don't accept G&S, some individuals may. | 0.5 points
Fiat - High, local currency is accepted as cash or digital. | 1 point
Crypto - Low to medium, not widely accepted yet.  | 0.5 points
FC - To be determined, aspiring to be the worlds most accepted money. | 1 point

4. Durability (How strong is the currency physically)
Gold & Silver - High, can be melted down and reformed. | 1 point
Fiat - Low, most paper cash is fragile. High, digital fiat. | 1 point
Crypto - High, is non-physical. | 1 point
FC - High, is non-physical. | 1 point

5. Portability (Is it difficult to physically move)
Gold & Silver - Medium for small amounts, hard for large amounts. | 0.5 points
Fiat - Easy, either digital or as cash. | 1 point
Crypto - Easy, it's digital. | 1 point
FC - Easy, same as digital fiat and crypto. | 1 point

6. Non-counterfeitability (Can it be fraudulently copied or produced)
Gold & Silver - Medium, metal that looks similar can be counterfeited. | 0.5 points
Fiat - Medium, cash can be counterfeited. | 0.5 points
Crypto - High, very difficult to impossible to counterfeit most crypto's. | 1 point
FC - High, aspiring to be impossible to counterfeit. | 1 point

7. Centralisation (can or is managed by a few people, as in sourcing, creation, regulation, value & transfer)
Gold & Silver - No, is decentralised, anyone can find it and prices are set by the market. | 1 point
Fiat - Yes, via governments and banks. | 0 points
Crypto - Yes, some are centralised. Even decentralised, most consensus mechanisms can become centralised | 0.5 points
FC - No, it uses your own private ledger, is P2P and has a fixed purchase price | 1.5 points

8. Inflationary (Do you need more of it over time to buy the same things)
Gold & Silver - Depends on supply, demand and economic conditions, generally appreciates | 1 point
Fiat - High, which devalues the currency | 0 points
Crypto - No, which can increases value, but depends on market value | 0.5 point
FC - No, has locked purchase price, is capped & deflates & appreciates | 1 point

9. Intermediary for delivery / Trust / 3rd party authorisation
Gold & Silver - No, assuming you transfer it via your hands. | 1 point
Fiat - Cash no, digital yes, require banks authorisation and trust | 0.5 points
Crypto - Yes, requires trust and consensus of 3rd party miners | 0 points
FC - No, only your authority is required to transact P2P, it's trustless | 1 point

10. Stability (Value fluctuation & volatility)
Gold & Silver - When measured in fiat, it fluctuates, but generally appreciates. | 0.5
Fiat - Fluctuates value | 0 points
Crypto - Fluctuates value, can be volatile | 0 points
FC - Fixed purchase price and cap provides stable and appreciating value | 1 point

11. Fees
Gold & Silver - No fees to use. | 1 point
Fiat - Can be fees for spending, storing and withdrawing | 0 points
Crypto - Medium to high fees for exchanging and transacting | 0 points
FC - Low to no fees | 1 point

12. Custody
Gold & Silver - If you hold it, you have custody. | 1 point
Fiat - Banks have custody of your account, cash you do | 0.5 points
Crypto - Self custody and custodial accounts available | 1 point
FC - Only self custody available | 1 point

13. Format
Gold & Silver - Physical. | 1 point
Fiat - Digital and physical currency | 2 points
Crypto - Only digital | 1 point
FC - Only digital | 1 point

14. Controlability (By policy or influence, the amount in supply, the value)
Gold & Silver - Value is manipulated, is hoarded & most is mined by large corporations. | 0 points
Fiat - Is controlled by banks & governments. | 0 points
Crypto - Can be controlled & manipulated by the rich. | 0 points
FC - Cannot be controlled. | 1 point

15. Ease Of Use
Gold & Silver - Easy. | 1 point
Fiat - Easy to use. | 1 point
Crypto - Difficult to use. | 0 points
FC - Very easy to use. | 1 point

16. Exchangeability (Can be exchanged or sold for other currencies)
Gold & Silver - Yes. | 1 point
Fiat -  Yes. | 1 point
Crypto - Yes. | 1 point
FC - No, designed to be a closed loop system. Officially no, unofficially perhaps. | 0 point

17. Public Account Identification / KYC (Know Your Customer)
Gold & Silver - Depends on how you source it. If you find it or buy from an individual trader then no, if you buy from a dealer then yes. | 0.5 points
Fiat - Yes, require ID to open bank accounts. | 0 points
Crypto - Yes, require kyc to purchase, sell and transfer most of the time | 0 points
FC - No ID is required to use FC | 1 point

18. Transfer Speed
Gold & Silver - In person it's instant, if non-local then very slow. | 0.5 points
Fiat - Instant with cash or digital normally, some cases can be delayed | 1 point
Crypto - Rare cases instant, many cases 5-30 minutes | 0.5 points
FC - Instant transfer | 1 point

19. Privacy & Ledger
Gold & Silver - No ledger as its physical (assuming you hold it). | 1 point
Fiat - The banks see everything and use their ledger, unless using cash | 0.5 points
Crypto - BTC uses a public ledger, other cryptos use decentralised ledgers | 0.5 points
FC - Uses a self-hosted private ledger | 1 point

20. Individualistic Vs Collectivist (Sovereignty Vs Democracy / Reliance on others to use)
Gold & Silver - Individualistic & sovereign, no reliance on others (if you hold and deliver it) | 1 point
Fiat - Relies upon collective governance via banks & government, democratic | 0 points
Crypto -  Relies upon collective consensus mechanisms and miners, democratic | 0 points
FC - Individualistic & sovereign, but still reliant on the tech itself and internet | 0.5 points 

 
Points As a Good Money
FC - 19 points
Gold & Silver - 15 points
Fiat - 11 points
Crypto - 10 points
*Assuming FC where as to be determined is high

Sovereign Vs Democratic Money

Sovereign vs Democratic money means usability determined by the individual or majority vote. A democratic money means if you're outvoted for whatever reason, you can't use your money.
Money should not be democratic. It should be sovereign. If you can be outvoted and not allowed to use your money, then it's not your money. A good money recognizes the individual as sovereign and is not part of a democratic system. You should be the ultimate ruler of your wealth, not a majority vote. If you must put faith and hope into your money, you're using the wrong money.

Banks are collectivist and democratic systems. Provided you have the permission of those who run the bank and the people the banks answer to, like government officials, then you can use your money. Some may view this as a good system to prevent criminal behaviour. But more often than not, we see banks and governments acting as criminals and unjustifiably freezing innocent and good peoples accounts. It's on record that banks even steal cash from peoples accounts, whether due to bail in policy or government order. This collectivist and democratic system violates any sovereignty one believes they have over their account and wealth. With banks, your ability to use your money isn't a right, but a privilege which can be revoked at any moment.

Cryptocurrency functions in a similar way. You may have a self custodial account and hold your keys, preventing unauthorized crypto confiscation by external forces. But to transfer funds, you must rely upon a collective, democratic consensus. Whether it's proof of stake, proof of work or any others, you can only send and receive money if the majority say you can. It may be harder for the majority to negatively control this compared to banks, but the fact is it's possible. You're reliant on many intermediaries to ensure your money is delivered and received. Your ability to earn and spend is ultimately decided by majority rule, ie, democracy. The power to use your money is in the hands of the collective, not you the individual.

With FC, there are no intermediaries or external custodians. There's no democratic vote or collective consensus governing your ability to earn and share your wealth. You are the sovereign and as a sovereign, you individually control who you send money to. Your power to receive and send Credits is not up for debate, vote or collective agreement. Your private ledger is self hosted and self custodial. Your FC's are cyptographically secure and not counterfeitable. You secure your account with as many 2fa's and strong passwords as you choose. No one can see your balance or transaction history. No one can freeze your account or withdraw funds without your consent. No one can block your ability to send or receive. 

Your money transfers directly P2P, from buyer to seller. There are no postmen you need to pray to that shall deliver your money, like you must with banking and crypto. Using The FC is like sending a Bluetooth file or text message, the closest there is to digital cash. Everything else is like using a postal network, it must travel from hand to hand and at any point, the postman may fail to deliver your money. Good money is built with individual sovereignty in mind, not collective democracy. A good money should be trustless, relying on as little external factors as possible. All The FC relies upon is electricity to power your devices and the internet. All other alternatives require you to trust people and people can make errors or become corrupted. Trust a money which empowers you to be the sovereign of your wealth.

Discover More

Efficienomics & Monetary Morality

Page 3

Page 1 - Value / App / Transactions / Privacy / Fees / Bonuses / How Do I Get FC? / How Many Are There? / Where Can I Use FC? / Goods & Service Grant

Page 2 - What Is Money? | Comparing Monetary Characteristics | Sovereign Vs Democratic Money

Page 3 - Efficienomics - Closed Loop System - Morality Of The Current Monetary System - The Banks Own Your Money

Page 4 - Financing With FC : Misc

Page 5 - (Videos) Bitcoin Problems | Banking History | Currencies Compared

Page 6 - Fiat Inflation Vs FC Deflation \ The Value Of Money \ How Is The FC a Replacement To Modern Banking?

Page 7 - Sending Technicalities & Security : What Is The Private Ledger?

Page 8 - What's My Motivation? - Bitcoin Problems - Understanding Inflation

The Freedom Credit is in the concept phase. If you can improve or build it, reach out to James The Traveller on Facebook.