No one talks about monetary debasement. It’s not taught in schools, and most parents don’t explain it to their kids (though I make sure to teach mine—and I believe we all should). But it’s crucial to understand because it silently eats away at the value of your hard-earned money.
So, what is monetary debasement? Let’s go back to Roman times. Back then, rulers would clip the edges off coins and, eventually, mix gold and silver with cheaper metals like tin, nickel, or copper. This allowed them to create 'more' money at a fraction of the cost. Sound familiar? It should—because modern governments are doing the same thing today, only with paper (or more accurately, digital) money.
Today’s era of fiat currency—money not backed by anything like gold or silver—makes debasement even easier. Governments can simply create more money out of thin air, whether digitally or physically. But there’s a catch: every new dollar they print makes every existing dollar worth a little bit less.
Let’s take a look at the Australian dollar. Since 2000, so much new currency has been printed that the dollar in your pocket today is only worth 15 cents compared to what it was worth in 2000. That’s an 85% debasement of the currency.
To make this clearer, let’s do some quick maths. In the year 2000, the median house price in Sydney was around $287,000. Today, it’s about $1.66 million. But when you adjust for inflation, 15% of $1.66 million is about $249,000. So, in terms of year 2000 dollars, that’s an increase of just $38,000—hardly the huge property windfall it appears to be. In real terms, the annual return on that investment is just 0.59%. The truth is, house prices aren’t skyrocketing—what’s really happening is the value of the dollar is dropping rapidly.
This brings us to Bitcoin. Unlike fiat currency, Bitcoin cannot be debased. There will only ever be 21 million Bitcoin, which means no one can ‘print’ more, and no central authority can decide to dilute its value. It’s the ultimate form of sound money and a safeguard against the hidden theft of monetary debasement. While the value of the Australian dollar continues to erode, saving in Bitcoin allows you to protect yourself from this silent tax.
If you want to preserve your wealth, it’s time to think beyond traditional investments like real estate or stocks and consider the benefits of Bitcoin. It’s the one form of money that governments can’t manipulate—and in a world where debasement is the norm, that’s more important than ever.
