[Cryptography] Montana: A Post-Quantum Blockchain with Time as Scarcity

[John Levine]

It appears that Ron Garret <ron at flownet.com> said:
>
>> On May 23, 2026, at 3:53 PM, calebpayne at gmx.us wrote:
>> 
>> The exchange between Bill and Ron Garret cuts straight to one of the most persistent schisms in monetary economics and decentralized
>systems design: the distinction between **money as a stable unit of account** and **money as a neutral censorship-resistant ledger**.
>
>There is actually a higher level of abstraction which is: money as a GENERALIZED CONTRACT, specifically, a generalization of an I.O.U. where
>one of the parties is not an individual entity but society at large.

I would agree but I would also say that's quite a modern interpretation.

For a very long time, money was defined as a specific weight of gold or silver
or occasionally (the US in most of the 1800s) either or both. The theory was
that it kept governments from inflating the currency, but the reality was that
there were a lot of shenanigans (you may recall that Archimedes famously ran
naked through the streets shouting Eureka! when he figured out a way to tell how
much silver was in a nominally gold object.) It also meant the money supply
depended largly on finding new gold or silver mines.  When Spain brought back
ships full of gold from the Americas they imagined they'd be rich, but in
reality the inflation was horrible for the Spanish economy.

This came to a head in the 1920s and 1930s.  During WW I most countries had
suspended gold convertibility because they needed to print money to finance
the war, and the conventional wisdom was that they had to get back on gold
at the pre-war price, which meant deflating the currencies which of course
caused great economic distress and unrest and we know how that turned out.

At Bretton Woods in 1944 Keynes wanted to replace gold with a synthetic reserve
currency called Bancor, but at that point he was old and quite sick and Harry
Dexter White forced them to use dollars at the US' nominal gold parity because
at that point the US had all the dollars and most of the gold.  This worked OK
for several decades until Nixon finally broke the tie to gold and currencies have
floated ever since.

Lacking the link to gold, you're right, money is basically an IOU from the
issuing entity which is usually but not always a government. In some places
suchs as Scotland and Hong Kong, commercial banks issue the local currency and
it works so long as the government ensures that the banks don't get too
enthusiastic. In the UK they do this by requiring the banks to back their notes
1:1 with Bank of England money, which they do with £100,000,000 notes called
Titans. I was startled when I went to an ATM in Hong Kong and it gave me notes
with the bank's own name on them, but everyone agreed they were money.

I think we agree that if cryptocurrency enthusiasts understood the history
better they might not be so inclined to reinvent bad ideas that real currencies
abandoned a century ago.

R's,
John