Assets, Ethereum

Why Is Ethereum Ultra Sound Money?

Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third party interference.

Ethereum is a completely different beast compared to what came before it. Rather than being a currency or a payment system, Ethereum is a programmable blockchain.

This means that developers can build applications on top of Ethereum that do all sorts of things.

These applications are called decentralized applications, or dapps. Decentralized exchanges, identity management systems, prediction markets, and social networks are all examples of dapps.

What makes Ethereum so special is that it’s not just a platform for dapps. It’s also a platform for so-called smart contracts.

Smart contracts are pieces of code that can automatically execute agreements between people and businesses.

This has all sorts of implications. For one, it could automate all sorts of business processes.

NOTE: WARNING: Ethereum is not a sound form of money in the same way as traditional fiat currency. It is a digital currency, and its value can fluctuate significantly over time. Investing in Ethereum may result in a loss of your funds. Before investing, you should research and understand the risks associated with such investments and seek professional advice if necessary.

It could also make it possible to create entirely new kinds of markets and economic interactions that were previously impossible.

All of this makes Ethereum sound like an incredibly powerful tool with all sorts of potential uses. And indeed, it is already being used for all sorts of things.

But there’s one use case in particular that I think is particularly interesting: ultra sound money.

What do I mean by ultra sound money? I mean a form of money that is immune to inflationary pressures and financial crises. In other words, a form of money that maintains its purchasing power over time.

There are two key properties that make Ethereum ultra sound money. First, Ethereum is decentralized and thus not subject to the whims of central authorities like governments or central banks.

This means that Ethereum cannot be debased in the way that fiat currencies can through things like quantitative easing or other forms of monetary policy.

Second, Ethereum has a fixed supply. There will only ever be 21 million ETH in existence and no more can ever be created (unless the protocol is changed).

This means that Ethereum cannot be subject to inflationary pressures like fiat currencies are.

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