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Basics_02: Monetary History & The Rise of Bitcoin

Blue Collar Bitcoin

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The Problem With a Fractionalized Reserve System

As we started to move away from gold and precious metals, the problem is all of a sudden these warehouses realize that no one was coming to start taking claim on their gold. And so they're just like, well, why don't we print a few extra notes here and make a little bit of extra money? This is when the fractionalized reserve system started coming out. So how do you stop people printing money? Something like Bitcoin, you need something that inhibits it.

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