For thousands of years humans have been in pursuit of a universal kind of value that can act as both a durable store of long-term wealth and a convenient means of exchange for commerce. This has increasingly lead humanity to durable and universally valued commodities; first grain, shells, and glass beads, but later precious metals: copper, silver, and finally gold. The gold standard was not a pursuit of gold as money for it’s own sake however, but was a pursuit of gold for its universality as property —and the nature of the pursuit becomes a kind of self-fulfilling prophecy when gold acquires its monetary premium.
In the modern day the most apparently viable monetary singularity that can serve the sound-money-role appears to be bitcoin, and increasingly people believe ether can play that same role as ultra-sound-money, but I’d argue the existence of a global infrastructural layer for encoding the entire state of a market economy and its economic goods actually obviates the need for a singular currency in the first place. If money’s role is to be a universal commodity, why is it even needed if you can track the price of, create a derivative of, and own, every commodity?
I think a fundamental conceptual change in direction that needs to occur with regards to humans’ pursuit of an endgame apex currency is the disconnection of the idea of currency from both of its functions: salability across time and salability across space; i.e, is it a store of value and means of exchange.
The existence of a universal commodity to serve these roles comes from a fundamental physical problem that existed in markets: if I need stable purchasing power to act as a monetary-base for my future purchase of decaying consumption goods, I cannot acquire that from the accumulation of said consumption goods outright, since they will, well, decay; if I subsist off of a set X of different foods every month, I cannot just get paid in X for my own labor since the factors of X will literally expire over time.
A fundamental benefit of Ethereum however is the mass tokenization of economic goods that lets you gain exposure to amortizing forms of value at a continuous rate; this means instead of storing wealth in a commodity that will hopefully buy me as much X now as it will in 30 days, I can store my wealth in an index of futures contracts that give me exposure to the underlying products within X.
The intuition here comes from the realization that the entire state of prices in a market economy is analogous to monetary gas filling an N-dimensional container, where N is the number of goods for sale in the economy; money expands throughout the economy to distribute itself equally based on the relative scarcity (supply) and demand for goods, which creates an equilibrium of prices; since money is the most salable good here, it acts as a kind of universal exposure to the entire container, but isn’t this inefficient? In theory the role of money can be thought of as taking place at the ‘top right’ corner of this container, which is the point of equilibrium where you have equal exposure to every economic good equally; really though, it would be more efficient for individual actors to be able to choose some other point of N coordinates that define their unique exposure to a collection of goods in line with their own purchasing habits, this means you can essentially create modular and composable stablecoin systems that don’t rely on a universal catch-all unit like a dollar.
The result is a truly universal, decentralized, personalised, and hyper-efficient composable system of currency that can be tuned to any economic actor’s individual needs, providing a solution to the inalienable problem of money without falling victim to the many dangers of economic singularities.