I got into crypto in 2017 when I came across the phrase "money is a technology". That idea fascinated me. But fast forward several years later, and it's obvious that money might be a technology in the sense that it's a tool, but more importantly, money is a culture.
People have made crazy stories up about "the origin of money" for a long time; Adam Smith makes up a zany story about people agreeing to use chunks of metal to make change for bartering because it's too hard to keep chickens in your wallet when you need to break a sheep[1]...
The notion that people gravitate to metal vs "fractional sheep" is without historical evidence. People in fact, a long time ago, did trade things like IOUs or pieces of broken reeds or sticks[2]. Those sticks acted like IOUs and were often traded around far past the original parties to the contract.
Money is a contract between you, your peer/counterparty, and whatever organization you "trust" to mediate if someone really isn't happy with the outcome of a situation.
Money is, indeed, culture.
[1] https://www.adamsmithworks.org/documents/chapter-iv-of-the-o... [2] https://en.wikipedia.org/wiki/Tally_stick
Or if you read Sapiens you'll know money is a story we tell each other. You can't literally do much with a coin or bank note or numbers on a screen but as long as we all believe it has value, it does. It becomes part of the culture, as you say.
Crypto also has to tell a story about why it's valuable. There was a lot of anti government rhetoric and fear mongering (from libertarians) but the public never really believed the story was true. It was a lot of FOMO.
NFTs failed completely to sell their story but crypto is still hanging on among its supporters. AI is telling a similar story about the value of tokens which is being well received
Fiat currency isn't just a matter of belief or stories. If you interact with the US financial system in any significant way then you're likely to end up owing some income taxes, and those can only be paid in US dollars. If you don't pay then eventually law enforcement officers will seize your assets (real estate, cattle, gold, cryptocurrency, whatever) by force and auction them off to settle your tax debt. And if you try to stop them then they'll shoot you. Overall this is a good and stable system. The cryptocurrency clowns never seem to address the sovereign taxation issue.
While that is true, the overarching point is that it fundamentally still is, just a story. You're just describing real world consequences, precisely because humans/societies believe in that story and enforce it.
By that logic, most everything other than a club to the head is "just stories". Hume points out in a Treatise on Human Nature that most of how we interact with the world is through a coherent hallucination provided by sense organs that tell very narrow stories, but when stitched together form a cohesive whole. You're almost doing the equivalent of saying that gravity is "just a theory".
Society is a story, not a chemical reaction. People like the story of money because the stories that had gold coins or barter sucked a lot worse.
So what you're saying is that you can pay your taxes in dollars, real estate, cattle, gold, cryptocurrency or whatever.
> Fiat currency isn't just a matter of belief or stories
... Then how do we, as a society, determine how much a dollar is worth?! We do use force to enforce the stories we tell about fiat. But 'believe this story about how much a dollar will buy you and how much you owe, or else we will send thugs to your house' isn't disproving the point at all.
"but as long as we all believe it has value, it does".
Would one argue that an airplane is a _story_ ? If no one believed in the technology and lost faith in all pilots no one would fly. But that doesn't change the reality of the technology and competence of the pilots.
I get the sentiment, but I am not sure _story_ is the right word.
Well no, an airplane is a tangible thing that can fly, and as long as the safety culture of the people responsible for flying airplanes is strong enough, so crashes are very rare, people will fly with it.
Currency OTOH is basically a (forgery-proof) piece of paper with a number written on it, or even just a number in a database on some (hopefully well-protected) server. So it can only be used to buy stuff as long as we all agree that it's worth something. Of course, it helps if a government and/or a central bank is behind it, but even without a functioning government, a currency can limp on for decades, such as in Somalia, where the last banknotes were printed in 1991, but people still used them as the lowest "rung" of a three-tier system consisting of the Somali shilling, the US dollar and mobile phone payments, until recently when businesses sort of agreed to not accept them anymore (https://www.theguardian.com/world/2026/may/11/poorest-somali...).
> but crypto is still hanging on among its supporters
From what I last heard about crypto miners, the price of mining is not enough to justify price of rig + electricity, so they are quietly switching to AI.
Wonder how long the second scam will last.
AI can’t exactly be turned into money the way crypto shenanigans can.
You can sell inference, but it has to actually be real.
You can sell scams -- LLMs may be dubious at many tasks, but they're probably good enough to use to write personalized email or texts convincing random people to send you money.
> There was a lot of anti government rhetoric and fear mongering (from libertarians) but the public never really believed the story was true.
The public never believed it because it runs squarely into the basic fundamentals that underpin the global financial system.
The finance industry learned long ago that currencies have to be stable and predictable in order to be trusted, and therefore NOT financial instruments to speculate heavily on. There's been this reality distortion field that crypto can be both a currency and speculative asset, but that hasn't borne out. If your digital dollar can gain/lose 5% of its value in a day, how do you trust it to transact with?
Crypto has been speed-running into many lessons we learned decades ago from the "Free Banking" era before the Fed, back when states ran their own banks, currencies, etc. Government got involved in banking management as a way to improve the stability and security of the financial system since things like fraud were rampant.
Honestly as much as people complain the US Federal Reserve really just proved their enormous value and thoroughly vindicated fiat currency. The financial crisis of 2007-8 should have been a new Depression and it wasn't. Instead we've seen uninterrupted growth for close to 20 years. Markets have really internalized that the US economy is indestructible and the Fed will always protect us from disaster. Will it last forever? Of course not. But like Keynes said, "in the long run, we're all dead".
Euros, dollars, pounds, francs, and yen are all more stable and easier to use than cryptocurrencies.
It gets even easier once you toss in Visa, Mastercard, Discover, Amex, various debit card and regional networks, and ubiquitous banking services. Checks and online ACH payments are free or nearly free. Payment card platforms are cheap in consideration the value you get for them.
Meanwhile actually spending crypto is quite expensive - worse than Visa’s transaction fees, and far less consumer and merchant protections.
The key difference is that they all require identity to use and can be traced back to a person.
Cash requires no such thing. Neither do easily available gift cards. There is a little more friction involved.
As a merchant I have zero desire to sell online to an anonymous buyer because the fraud risk is too high. I have to know whom I’m shipping to and how they’re paying for it.
That is by design and is a good thing to everyone except cartels and communist governments.
What about people wanting to buy abortion pills?
Cash, at a pharmacy.
Crypto doesn’t make that any better.
Neither does online ordering. Online orders have to have a degree of KYC.
Banks racked up huge losses on subprime mortgages, get bailed out to save customer deposits which the banks continue to profit from, most bank execs walk away scot-free, and that's a vindication of the system? They literally gambled with customer funds, lost it all by enriching incompetent sellers of bad MBS, and got it replaced by the government. With the money supply being inflated from the replacement, the only people who benefitted were the bad actors who still have a share of the now diluted supply of customer funds.
The fundamental structural problems from 2007-8 are still here. The system has been running with paper over the cracks in the foundation for almost 20 years.
Every system ever has been a patchwork. Dodd-Frank and it's orderly liquidation rules are a genuine benefit. We had a commercial bank collapse a few years ago and there was no contagion.
Most of the market is now in shadow banks. What happens when they collapse?
I mean, cultures are also a kind of technology, arguably one of the first we developed as Homo Sapiens.
In my view the actual issue has always been that cryptocurrency folks don't understand what purpose money serves, mostly because they're all basically gold bugs. To strain the "money is a technology" metaphor, this is a product-market-fit issue -- like trying to build a cloud orchestration framework that only works on DIY Belwulf clusters or a web framework that only looks nice on teletype.
Crypto exists to make early crypto holders money.
You get in on the speculative promise of making yourself wealthy. It's sold to you by the people at the top, and the message is amplified by the grifters and the pick mes in their orbit.
It's never been a convenient exchange of money. If they'd focused on this, maybe the argument would have worked. Instead, it's wacky and has the worst UX of any banking apparatus in the world. Including giant US banks stuck in 2005. This sucks because this is literally the value being sold, and it doesn't deliver on it at all.
By the time quantum chips can attack crypto's underlying hardness (2029?), most of the coins won't have the engineering talent and support left to migrate to more secure cryptography. We'll start seeing shit coins popped left and right, which will cause mass panic. That will cause sell offs, even if the big name brands manage to secure themselves temporarily.
Post quantum cryptography is not fundamentally that hard, the only issues are the signatures are bigger (so the chain is less efficient), and migration of existing chains (biggest problem).
Quantum computers might harm BTC or some other chains if the devs can’t get their house in order soon enough, but there’s no reason to think it fundamentally alters whether cryptocurrency is mathematically viable
Migration for certain prominent projects is already underway, e.g Ethereum.
It's too late.
How are you going to mass migrate all of the cold, dark wallets?
It's not going to happen because it requires conscious, deliberate, careful migration on the part of the wallet owners. You won't even be able to contact or warn most of them, let alone get them to understand the process.
Probably half the value in Ethereum and Bitcoin will be popped this way.
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