Bitcoin has been touted as the solution to monetary debasement, but what is debasement really, and where does it come from? The second installment of “10 Steps to Self-Sovereignty” powered by Ledger.,

Understanding Debasement and its Origins

Introduction

Bitcoin has often been portrayed as the antidote to monetary debasement, but what exactly is debasement, and how does it originate? This article delves into the concept of debasement and its underlying causes.

What is Debasement?

Debasement refers to the act of reducing the value of a currency by lowering the content of valuable metals such as gold or silver in coins. This can be carried out by the governing authority who controls the currency.

Origins of Debasement

Historically, debasement was a common practice among governments looking to finance their activities without increasing taxes. By reducing the metal content of coins, rulers could essentially create more currency to fund their endeavors.

Video: The Impact of Debasement on Economies

Bitcoin as a Solution

With its decentralized nature and fixed supply cap of 21 million coins, Bitcoin aims to counter debasement by eliminating the ability of central authorities to manipulate the currency supply.

Conclusion

Debasement has been a recurring issue throughout history, leading to economic instability and loss of trust in traditional currencies. Bitcoin presents itself as a viable alternative to combat this phenomenon and promote self-sovereignty in the realm of finance.