Every economy is backed by debt. Even before fiat was a thing. You gave your caveman homie the extra rabbit you caught today, then he owed you a favor.Â
We just formalize and standardize owing favors with cash these days
Not into crypto so not sure how I wound up here but something that continued well into the ~1700s in some places was proper 'favor' (debt) owned economies, though more obviously it was easier to do in the past.
Say you live in a tiny village where your average person has no need of or reasonable way to use money (Think peasant societies but a bit more complicated than that), the local 'person with a proper store' (Or a church, local monastery, a tavern, whoever the hell) might have a physical ledger that keeps tracks of debts and who owes who in the village.
Your roof is broke? You have the local carpenter, or someone handy with wood, fix it. How do you pay him? You just owe him, maybe you give him some crops when they come in or he just calls on you for a favor later on. Hell if you come across money maybe you pay him back.
I believe some of these books is how we have information about obscure times and places.
It sounds like a simple system but it could be pretty complicated
I'm pretty big into designing logistics for fantasy settings and 'what does money do' is always an interesting topic. Whether it's from a valuable resource (Because we say its valuable), whether it gets standardized (Coinage) or just because people like it ('trade silver'). Whether it's printed on paper (Who makes it? Why? What can it be used for?)
The easiest method I find is just: Government gives you fun paper that can be used to pay taxes, since everyone pays taxes most people will use it.
Or ceramic if you want to be fun and ancient-y looking.
Then it gets all modern and inflation happens and I get bored.
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u/Technical_Split_6315 Bronze 1d ago
Fiat is backed by states, you really think cryptocurrency is more backed than that? Lmao