Why Gold Was The Dominant Form of Money Through Most of History

Why Was Gold Used As Money Over All Other Elements?

Intro

This post is an add on to my post of why Gold and the Blockchain are a match made in heaven, which can be found here.

This post explores why gold is valuable and why gold has been used as money over all other elements/metals throughout history.

Why Gold is Valuable

As an outset to this discussion, it is important to keep in mind that nothing in the world has intrinsic value. Value is something that we as individuals give something, such as the difference in value between a $100 bill and a $1 bill.

Gold has been around for tens of thousands of years and has been used as money throughout its history. This long history paired with gold’s characteristics provide the answer as to why gold is valuable.

SPECIAL CHARACTERISTICS

What makes gold valuable are its characteristics. Gold is durable to the point of virtual indestructibility as it cannot be destroyed by water (doesn’t rust), time, or fire. You need a minimum of 1945 degrees Fahrenheit to melt gold.[1] In addition, gold is also highly malleable, i.e.: it can be pressed + pounded into various shapes. Gold is also very rare, if all the gold in the world was melted, it would fit within the confines of an Olympic Swimming Pool.

FINANCIAL ADVANTAGES OVER OTHER ASSETS

Gold also has several financial advantages when compared to other assets. Gold has no time limit and no shelf-life; most of the gold found is still in existence. Gold is also portable, and divisible; splitting up gold does not change its value, as opposed to other metals, like diamonds. Lastly, gold cannot be counterfeited or inflated; central banks cannot reproduce gold as they do with fiat currencies.

Why Gold as Opposed to Other Elements/Metals

What made gold a better choice than all other elements/metals are its special characteristics noted above. There are 118 elements on the Periodic Table of…