Hayek Predicted Bitcoin

Every second of every day, the hard-earned money of the world’s citizens is devalued by government policies and money-printing. They’re making prices rise when they should be falling, and making it more difficult than ever for people to plan and save for the future.

Nobel Prize Winner F.A. Hayek rightly blamed governments for the inflation of the 1970s, and his short book, “The Denationalization of Money,” offers a novel proposal.

Here in Episode 4 of our series on Blockchain Economics, Lawrence H. White, Professor of Economics at George Mason University, will walk you through Hayek’s elegantly simple proposal: make private individuals and businesses free to offer their own money to compete with that of the government.

Among other benefits, governments would have to improve — and stabilize — their currencies.

Also in this video, Private Irredeemable Monies, Professor White outlines some of the potential pitfalls of Hayek’s ideas, including money’s network effects. Of course, Hayek was more than ready for detractors.

How are Hayek’s ideas relevant today? Look no further than cryptocurrencies — and let Professor White explain how they have put Hayek’s thought experiment into practice.

You can find Learn Liberty’s take on Bitcoin here.