Fiat Currency

What Went Wrong with Fiat Currency?

Decoupling the Dollar

On August 15th, 1971 the U.S. dollar was decoupled from gold by President Richard Nixon. In putting an end to The Bretton Woods International Monetary System (the Gold Standard) the U.S. was no longer required to hold gold in reserve as backing to their dollar. As the world’s primary trade currency, this removed any tangible backing of the world’s currencies. The USD stopped being true money, exchangeable for gold and became a promissory note based on trust and faith. It is TREOS’s assertion that the trust and faith placed in fiat currency have been misplaced.

Central Banking

Mayer Amschel Rothschild is famously quoted as saying “Let me issue and control a nation’s money and I care not who writes the laws”.

Despite being given names like “The United States Federal Reserve” and the “Bank of Canada”, central banks are not public institutions but rather privately held corporations that issue a currency to the government at interest. This means that for every dollar that is added to the money supply, a dollar plus interest is owed. The entire fiat monetary system is built on debt and if all debt was repaid there would not be a single dollar left in circulation.

Fractional Reserve Lending

In the fractional reserve system, a bank is required to hold only a percentage of all deposits in their vaults and allowed to loan the rest, at interest. This can and does occur repeatedly until the original deposit has multiplied many times over with new money being created out of “thin air”. This new money exists only on the bank’s ledger. TREOS believes this makes no sense from either a practical or logical perspective and that it only further serves to enslave a society with debt.

The Unbanked

Over 2 billion people do not have access to banking services. This has long been the “Siren’s Song” of cryptocurrencies with promises of providing access to a monetary system outside of traditional banking. While the intentions are noble, the execution has been lacking. With increased regulation for the cryptocurrency, it is still a challenge for the unbanked to acquire cryptocurrencies and, because of its lack of acceptance as money, even those able to acquire cryptocurrency have difficulty utilizing it in a tangible manner. TREOS provides both ease of acquisition as well as a platform for spending stable TRO token.