World Currency: The Value Of Money

How is money really valued? If you think about it, money is just a piece of paper. In the case of coins, that’s just melted metal. On its physical composition, money does not cost much (unlike precious metals), but despite that, we all need money to use in day to day transactions and basic purchases.

The value of money lies in its use. Its value is calculated on the goods or services that you can exchange it for. But while money allows us to buy what we want and need, the real value of money really lies on the assets behind it. Ever wondered why the US Dollar is the most valued currency in the world? It is because it has the largest and most prolific asset base in the world.

What many people don’t understand is that earning a lot of money does not make you rich. You are not rich because of the money you have, but it is because of the assets you help create. For example, if you are living in a cold and icy community, building an igloo would be costly – but it will prove to be a worthy investment because other people would pay to stay on that igloo to keep warm.

If you are the owner of the igloo, of course, you want to be compensated for the use of it. And because the world wants a quick and quantifiable way to do fair transactions – this is where money and currencies come in.

Again, the value of money is only determined for the things that it can be exchanged for. This means that if you want to make the most out of a monetary system, you have to invest in good and useful assets. And the one thing to remember here is that money or currencies are actually backed by actual assets.

Intrinsic Value of Money

Even in the early days, money is always backed by a certain asset. The most popular of this is Gold and other precious metals, but common items such as Salt, Cheese, and even certain Spices were also used as assets before.

In modern times, this principle can be applied in cryptocurrencies. If you are looking for safe and secure cryptocurrencies to invest in, make sure the coin is backed by an actual asset. You have to do your research if you want to get the most out of your investment.

For sure, most cryptos will say that they are backed by a certain asset. So the next question you should ask yourself is – will it be useful for a certain community? Does that asset provide real value? Asking these questions can lead you to make better investing decisions when it comes to both cryptocurrencies and actual money.

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