Throughout human history, currency has never truly escaped a pattern: Birth → Expansion → Devaluation → Collapse. Whether it was the Roman denarius, France's assignats, or the modern US dollar, this trajectory has always been present.
The fate of fiat currency
A stable beginning
Almost all currencies were initially linked to scarce assets. For example, Roman coins were once close to pure silver content, and the US dollar was long backed by gold and silver. Such scarcity once effectively constrained government spending.
The temptation of printing money
With the expansion of war, welfare, and bureaucracy, governments repeatedly resorted to 'expediency'—reducing metal content, suspending gold convertibility, and completely abandoning the gold standard. This avoided fiscal pain in the short term but buried long-term risks.
Inflation phase
When money supply loses constraint, price increases become inevitable. In the lighter cases, purchasing power may halve over decades, and in severe cases, it leads to hyperinflation, as seen in Zimbabwe and Argentina. People become increasingly unwilling to save, accelerating the vicious cycle.
Collapse and restart
When trust collapses, the currency system can only be sustained through 'resetting.' France's assignats nearly went to zero in a decade, and Germany's hyperinflation in 1923 was directly replaced by a new currency. But the cycle never stopped; it just began anew in a different form.
Why fiat currency is doomed to fail
The root of the problem lies in politics and human nature: Without a hard scarcity constraint, short-term interests always outweigh long-term stability. Historically, more than 700 types of fiat currencies have almost all met the same fate.
The difference with Bitcoin
The emergence of Bitcoin gives humanity a chance to break out of this cycle for the first time:
Fixed total supply: 21 million coins, never to be exceeded.
Decentralization: No single entity can alter the rules.
Transparency: The ledger is fully public and can be audited at any time.
Global circulation: Crossing borders and bypassing capital controls.
Portable and divisible: Capable of making small payments as well as handling large settlements.
The possibility of breaking the cycle
Bitcoin puts currency back under 'discipline':
Governments can no longer fund endless wars through money printing;
Credit is no longer artificially suppressed to create bubbles;
Savings can preserve value across generations.
Inevitable transformation
The issue is not whether today's fiat currency system will end, but rather 'what comes next.' Historically, people have passively accepted new fiat currencies, but this time, Bitcoin offers an alternative voluntary choice.
When the next cycle arrives, those who entered the Bitcoin system early may already be standing at the starting point of a new era.
⚠️ This article does not constitute investment advice and is for learning and reference only.
