Elon Musk Believes Fiat Money is a Scam

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Elon Musk, founder and CEO of Tesla and SpaceX, recently reignited his criticism of fiat currencies by calling them an outright “scam” on Twitter. Responding to a tweet that asked about normalized scams, Musk simply replied “Fiat currency” to express his view that government-backed money has become unreliable.

Fiat currency

— Elon Musk (@elonmusk) October 1, 2023

This is not the first time Musk has voiced skepticism about fiat. In 2021 tweets, he stated “The true battle is between fiat & crypto. On balance, I support the latter.” At a Bitcoin-focused conference that year, Musk also described himself as “a supporter of Bitcoin and the idea of cryptocurrency in general.”

Musk’s own social media platform X (formerly Twitter) plans to enable money transfers between users in fiat currency first before potentially expanding into crypto transactions later on, according to a Financial Times report.

Unlike fiat, Bitcoin has a limited supply of 21 million coins, is decentralized, and its creation is algorithmic rather than controlled by any central authority. Advocates argue this provides independence from government overreach and inflationary policies.

By contrast, central banks can print unlimited amounts of fiat money, gradually depreciating its value over time. Unchecked money printing can lead to hyperinflation, like in Zimbabwe where inflation hit 79 billion percent in 2008 after years of increasing fiat supply. Or the Turkish lira which reported 61.5% inflation annual inflation yesterday.

To crypto proponents, the ability of governments to seize fiat assets, as Cyprus did to bank deposit holders in 2013 to avoid a crisis, is another risk not present with Bitcoin.

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