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I think there is a simple answer to this question:
Because every time you expand the Mars economy you create wealth that can be traded.
If Mars simply adopts the US dollar, let us say (it could be any Earth based currency but the US dollar is the most obvious choice), every time you create a bit of extra production on Mars, that doesn't immediately translate to increased monetary wealth on Mars. That will depend much more on the vagaries of dollar trading. In fact if the dollar generally weakened against a range of currencies, say but 5%, and you grew your economy by only 3% in terms of output, you would find the real value of your economy had shrunk.
Another key factor is that economics is an art as much as a science. If people think Mars is a successful place that is great to invest in, it will become such a place. It's what you might call the Dubai effect - given Dubai has virtually no resources. You need to deploy a bit of PR razamatazz but having your own currency helps lock in investment .
I feel that a Mars Currency makes huge sense and preferably it should be freely traded. We can see that over $100 billion has been invested in Bitcoin...I think a Mars currency would be even more successful. It would put billions of Earth currency into the Mars economy which the Government could then use to purchase essentials from Earth.
Let's Go to Mars...Google on: Fast Track to Mars blogspot.com
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Wikipedia Community Votes To Stop Accepting Cryptocurrency Donations
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If you need to use another country's currency to carry out trade with other entities, or even within your own country, then you must sell something to that country, in order to have a supply of their currency. You must do that even if the price they are prepared to pay is poor and doesn't feel like a good deal to you. Because without currency supply, trade grinds to a halt. This is why most countries want their own currencies.
Incidentally, did you know that all international trade in the oil market and most commodity based trade, is carried out in US dollars? This is where the petrodollar comes from. It effectively forces other countries to sell to the US at a discounted rate. It allows the US to spend money that it effectively doesn't have, because the value of the dollar is artificially high. If this virtuous cycle were to come to an end, the US military would be unaffordable in its present form. This is what makes the gold backed Yuan and Ruble a serious problem for the US on the world stage. If people begin trading in an alternative, gold backed currency, US purchasing power would effectively drop off the edge of a cliff.
"Plan and prepare for every possibility, and you will never act. It is nobler to have courage as we stumble into half the things we fear than to analyse every possible obstacle and begin nothing. Great things are achieved by embracing great dangers."
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Now it seems we will have the petroruble and petroyuan. There is no practical "gold backing" for rubles or yuan, though. Neither currency is tied to anything real, just as the US dollar is no longer tied to anything real. Declaring something does not make it so, either. We quit doing this nonsense because there is nowhere near enough gold and silver on the entire planet to serve as the foundation of the global financial system. What we effectively did, was to tie the currency supply to exchange of goods and services. That made a lot more sense, because economies need energy and food and manufactured products much more than they need shiny metals that people can't eat or drive to work in.
If Russia collapses because it has nothing of value to trade with other countries, then its currency is worthless. This is a much greater problem when your country imports what it consumes.
China's total gold reserves amount to between $90 and $91 billion dollars, yet China's economy is orders of magnitude larger than this. China's 2020 GDP was nearly $15 trillion dollars. One can easily see how silly this proposition of tying gold to currency would become. It's basically another one of their currency devaluation schemes, which doesn't help their people at all. China's real estate valuation bubble is around $52 trillion dollars, most of it tied to properties that nobody could ever live in or otherwise use.
Anyway, this is what happens when perverse government incentives are allowed to run amok. You get a real estate value that grossly exceeds your nation's GDP, despite the fact that nobody actually lives in these grossly over-valued properties and never will. If they try to tie their currency to gold, their financial problems will be absurdly worse than they already are. I want them to try, because when their house of cards comes crashing down around them, we'll be there to clean up.
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If people begin trading in an alternative, gold backed currency, US purchasing power would effectively drop off the edge of a cliff.
A gold backed currency of sorts may be the first extraterrestrial one. Someone on here, I think Mark Friedenbach, pointed out that gold mined in space would not have to be sent planetside to be profitable. Lunar vaults would be incredibly secure. The gold could be sold without being moved, and if that's in the form of a gold certificate, digital or otherwise...
I have wondered about the possibility of creating unforgeable physical tokens. I was thinking along the lines of using radioactive atoms to create defects in crystals. Because the decay is random, each crystal will be unique, and if it can be easily scanned then they could be compared to the open database to verify they match.
Use what is abundant and build to last
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If people begin trading in an alternative, gold backed currency, US purchasing power would effectively drop off the edge of a cliff.
A gold backed currency of sorts may be the first extraterrestrial one. Someone on here, I think Mark Friedenbach, pointed out that gold mined in space would not have to be sent planetside to be profitable. Lunar vaults would be incredibly secure. The gold could be sold without being moved, and if that's in the form of a gold certificate, digital or otherwise...
I have wondered about the possibility of creating unforgeable physical tokens. I was thinking along the lines of using radioactive atoms to create defects in crystals. Because the decay is random, each crystal will be unique, and if it can be easily scanned then they could be compared to the open database to verify they match.
Maybe a diamond containing carbon-14? Or a metal chip containing small industrial diamonds? Diamonds have intrinsic value because of what they can be used for and the energy embodied in their manufacture. Since economic value is really just the use of energy to carry out work, stored value is really a function of stored energy. Gold and silver are essentially valuable, because of the energy needed to extract and refine them. When money ceased to have value that was pinned to the value of a commodity (gold) its value was no longer tied to energy.
"Plan and prepare for every possibility, and you will never act. It is nobler to have courage as we stumble into half the things we fear than to analyse every possible obstacle and begin nothing. Great things are achieved by embracing great dangers."
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Bitcoin Just Dropped To Its Lowest Level Since 2020
https://www.slashgear.com/894388/bitcoi … ince-2020/
Old discussion
https://newmars.com/forums/viewtopic.php?id=115
The Local Currency - How many Martian Spanners does it cost?
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a true currency might take some time to set up
When does one start to Draft Laws of Mars, when would Mars have its own economic policy, maybe long before true colonization it might simply be a research site or a place for tourism?
Some news on science and vacation sites
Cancelling Antarctic climate research will damage Australia’s reputation, experts say
https://www.theguardian.com/world/2023/ … xperts-say
Exclusive: Lawyers and environmentalists warn international community is watching carefully amid ‘science, logistics and influence race’
Medina Aquarius Program
https://environment.fiu.edu/aquarius/
World-Famous Lodge & lagoon
https://jul.com/
An island in Thailand has the world’s only floating soccer field
https://www.thailandnews.co/2023/03/an- … cer-field/
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