Hello in this lesson we are going to cover the history of fear currency and overall what fear currency is in general. So let's first cover what fear currency is. There are really two main four aspects to fear currency and it's certainly any money any money declared by a government to be legal tender, to be legal tender, and this basically means the whatever is declared to be legal tender, where is paper based money or wherever it's metal of some kind, whatever it is, it essentially allow you to pay your debts and you might think I'm not indexer has to be applied to me. And essentially, the entire economy is just run on a debt based system, I owe you something, you owe me something. So if I go to a store and I want to buy something, if I want to, let's say buy a phone, and that costs $1,000 that's not that ridiculous the day phones costing more so if I didn't dollars, essentially, I owe them $1,000 for that phone.

And we we exchange the goods and the currency, essentially at the same time. But the whole idea is I owe money because it's a death because I have received a product or potentially a service. So it's any money declared by government to be legal tender, and it's money. It is money without intrinsic without intrinsic value. So this money that We have today, these notes, they don't have any actual true value apart from the value that we perceive from it. They don't essentially create innovation.

They don't advance the economy. It doesn't help drive ideas, creativity, any of that stuff. So, it is a money based system with no intrinsic value. Most often what is cool is to know the etymology, the etymology of words and the word fear. Word fear is a Latin word. That means let me rewrite that let, let it be done.

So you say a Latin word that mean let it be done. And it's essentially you used in the sense of order or decree says something has to be done so that he was fit means and it was introduced. It was intro used as an alternative as an alternative to commodity money, commodity money and Representative money, represent them to money. And you might be thinking, Okay, what are these you've probably heard of commodity I'm sure you've heard the both of these words, but I'm, I'm positive that you've heard of the word commodity. When it comes to currency and just economics in general, and a commodity based money is essentially a money that is based on an actual physical material, a commodity, so it's it historically, it's been metal based. So gold for example, silver, for example.

On a side note, the reason that on the periodic table that gold is Ag and geo GLG D, which confuses a lot of young people that are learning chemistry if because it actually stands for argenta. And in Greek times our Gen term was the color for gold. And actually, no, sorry, I'm talking about silver here, silver, sorry. So that should be more of a silver color. So a g a g is for silver. And it stands for gentium.

In Greek times, it was essentially the word for silver, like the actual water code, the color silver, but then in a bit later on in Roman times, it was essentially argentum was essentially the word for money because they use silver as a bit of a sign now. So going back to this commodity money is a money that is essentially a physical material, and that is what he's used to exchange. So if I were to go and buy this thousand dollar phone set of exchanging thousand dollars, I would exchange an X amount of, let's say Metro, let's just say silver. In this case, maybe it's 1000 silver coins or 1000 or 1000 grams of silver. And that's where a commodity Money is then representative money is a sort of a fear like currency. It's like in between that is backed by a sort of material a commodity.

And this is essentially the currency that we had for a long time when our money was back. That case terrible when it was backed by gold, we were still using sort of notes that said, let's say $10 on it, and he had some sort of face that literally sort of face it ad on there. It had some writing as well. But this was actually backed by some sort of material, which you could actually go and go to the bank. exchange your money for And equivalent amount of commodity, whether it was gold, silver, or what, or whatever standard was being used at the time. So it was introduced fear currency was as an alternative to commodity money and Representative money.

It's not do this all in capitals, it is not finite in its supply, fear currency isn't because government can just issue more where as a commodity based system and even I would say, really a representative money based system, there's only a limited amount of let's say, gold in the world or silver in the world. So there is a finite amount and that's sort of very representative to what we have in the form of cryptocurrencies, especially Bitcoin and that's all essentially it's modeled after is what we used to do with commodity based money where there was a finite supply but the actual perceived value of each, this a gram of gold might increase. So you might be able to get more per gram of gold. So it's not like once it was all mind that there couldn't be any fluctuation in terms of what you could get with an X, X amount of gold.

It was just there was a finite supply. That's basically what fear currency is. And also want to talk about the evolution evolution of payment systems, move payments of payment systems and there was commodity money initially. Ma t The T money. Then there was representative money. So this built on top of the commodity base money basically just created an abstraction layer.

Then there was fear money, which is what a lot of the world is today. And then there was stuff like checks, which was essentially just saying, you'll get paid at a later date. And you could just exchange it for some sort of fear based money just sort of added a convenience to free up money. So you didn't have to always be given the let's say, the notes, for example, to the other party, you could give a check, for example, and they could just well just check it in whenever they wanted whenever they were able to, though, is this a little safer as well instead of carrying huge sums of fear based money then we had electronic payment In chronic payments such as wire transfer and again this was still heavily based on the fiat currency system. So you could go to the say Western Union for example somewhere that would do wire transfers take thousand dollars and they will transfer that to somebody else potentially around the world.

Then after that is essentially the main money system we have now in an electronic no in 2017 initial electronic money and debit cards. And yet technically this is just another abstraction layer for for the fear money, but a lot of the world's money is actually not backed by like a physical notes essentially because there's not enough notes I mean printing most of it is Just ones and zeros in databases and in computers. So a lot of it does isn't in paper form. That's I think that's really, really cool to know. There's only two main dates that I'm going to cover. In this video.

There's a bunch of other intermediary date. They're more just when other countries and regions adopted for your currency, or really, I'll say the main one is the first youth and first youth of fear currency. First youth was recorded in China in roughly 1000, ce II. The next important date is 1971. And in 1971, Richard Nixon he removed The back in gold from the US dollar, because they could for a while it was a like or a thing a representative base system where it was backed by a certain commodity, which in this case was gold. Then richard nixon removed that and other countries around the world followed suit.

So this has just been a quick overview of the history of the currency. If you would like to know more, feel free to reach out. And as usual, thank you for watching, and I look forward to seeing you in my next lesson.