History never simply repeats, but it always dances to similar beats. Especially in the case of currency, the script has hardly changed for thousands of years: the money printed by governments, no matter how reliable it seems at first, will ultimately lead to devaluation or even collapse. From the Roman Empire's denarius to the German mark after World War I, to the paper money in our wallets today, none can escape this cycle.

But this time, there seems to be a variable - the emergence of Bitcoin appears to give humanity a chance to break out of this vicious cycle.

The four-step death dance of fiat money: it has always been the same throughout history.

The life of each fiat currency is like a drama with a predetermined ending, performed in four acts:

Act One: At birth, each one is a 'good child'. When the Roman denarius was first issued, it contained as much as 98% silver; for nearly 200 years after the birth of the dollar, it could be directly exchanged for gold and silver. This kind of 'hard currency' setup is like putting a tight leash on the government - want to spend more money? Fine, but you need enough gold and silver to back it up; want to print money? Not a chance.

At that time, currency was more like a 'promise': with this piece of paper (or metal), one could exchange it for an equivalent scarce item at any time. People are willing to trust it because they believe that this promise is solid.

Act Two: Desire inflates, the printing machine becomes a 'quick-acting cure'. But the government's desires will always grow: wanting to go to war, wanting to build infrastructure, wanting to distribute benefits, wanting to maintain a large bureaucratic system... What to do when money runs out? Raise taxes? The public will complain. Borrow money? High interest rates create obligations. At this point, the temptation of the printing machine comes - 'just print this one time, solve the urgent problem and stop'.

The Romans secretly mixed cheap metals into their silver coins, reducing the silver content from 98% to less than 5% in the end; the US suspended gold redemption during the Civil War and Great Depression, and in 1971 Nixon simply tore up the promise, making the dollar a 'naked currency' with no gold backing. Once the shackles of scarcity are broken, politicians find that they can get money without offending anyone; once this addiction sets in, it becomes impossible to quit.

Act Three: Inflation has arrived, money is becoming less valuable, currency is being printed in increasing amounts, but the goods and services in society remain limited. The result is simple: money loses its value. At first, it may quietly devalue, like the US dollar after 1971, which lost over 85% of its purchasing power; more severe cases, like Argentina now experiencing over 100% inflation annually, or Zimbabwe where buying a loaf of bread once required carrying a sack of cash.

What’s more terrifying is the vicious cycle of 'trust collapse': when people find that money is becoming less valuable, they will quickly rush to spend it - 'today it can buy an egg, tomorrow it might only buy an eggshell'. The more urgent everyone is to spend, the faster prices rise, and in the end, money becomes a hot potato that no one wants to touch.

Act Four: After the collapse, it will come back under a different name, like the 'assignats' during the French Revolution, which lost 99% of its value in less than ten years and were eventually completely abolished; the German Mark of 1923, which depreciated to the point where one needed a cart full of cash to buy bread, was ultimately replaced by the new 'Rentenmark'. Every time after a collapse, new currencies always shout 'this time we will be stable', either re-linking to gold or promising strict control over issuance.

But history is like an old man who loves to joke: the script for the new currency is almost no different from the previous version.

Why is fiat currency destined to fail?

Ultimately, it's still about human nature and politics. Hard currency can restrain government actions, but fiat money has freed that hand. When the power to print money is unchecked, short-term political interests will always defeat long-term stability - after all, politicians want results during their term, who cares about the floods ten years later?

In recorded history, there have been over 700 fiat currencies worldwide. The outcome is only two: either they have already collapsed or are on the road to collapse. There are no exceptions.

Bitcoin: The first currency to dare to say 'no'.

The most powerful aspect of Bitcoin is that it inherently refuses to repeat past mistakes. Its design is aimed directly at the fatal weakness of fiat currency:

The total supply is locked at 21 million coins, and this is not just talk. No government or central bank can change this number, because it is protected by the network's cryptographic algorithms and decentralized consensus. Want to print more? Unless all Bitcoin nodes in the world agree at the same time - which is harder than getting all countries to unify their currencies.

No one can control it - there is no central bank, no issuing institution, and not even a founder who can call the shots. The Bitcoin network operates like an automatic machine that spans the globe, running 24/7; no one can unilaterally manipulate or devalue it. Does the government want to ban it? It’s difficult, because its nodes are distributed worldwide, unless the entire internet is shut down.

The ledger is in the sunlight, and everyone can check every transaction of Bitcoin; the flow of each coin is clear. Unlike central banks’ balance sheets, which can be hidden and arbitrarily modified. This transparency gives it a built-in 'anti-cheating' attribute from the day it was born.

Anyone can use it, anywhere there is the internet; farmers in Africa can save, and Wall Street moguls can save too; transferring money abroad can be done without going through banks, without worrying about foreign exchange regulations, and arrives in minutes. Even more wonderfully, it can be divided into 100 million parts (1 Satoshi is one hundred millionth of a Bitcoin), allowing you to buy a mansion or a bottle of mineral water.

Can it really end the death cycle of currency?

If Bitcoin really becomes mainstream, many game rules will change completely:

Does the government want to wage an endless war? It must rely on solid tax revenue or voluntary borrowing, no longer able to secretly print money to let the public foot the bill; does the central bank want to boost housing prices and stock markets through liquidity? No way, because the total money supply is fixed, and interest rates must reflect real market supply and demand; do ordinary people want to save some money for retirement? No need to worry about half of their purchasing power shrinking in decades, because Bitcoin won't be 'secretly diluted'.

Throughout history, whenever a currency system collapses, people have been forced to passively accept new fiat currencies. But this time is different - Bitcoin has provided an opportunity for active choice.

Final words

The collapse of fiat currency is not a flaw, but its destiny. The emergence of Bitcoin has, for the first time, given this destiny a 'choice'.

You can choose to stay in the old cycle and watch your money slowly thin out; or you can choose to try new possibilities - not waiting for the collapse to blindly scramble, but understanding the new way to play this game right now.

History will repeat itself, but this time, you can choose a different script.

Disclaimer: The content of this article is for reference only and does not constitute any investment advice. Investors should consider their own risk tolerance and investment objectives, and rationally view cryptocurrency investments without blindly following trends.