In his recent book Before Babylon, Beyond Bitcoin, the writer and thinker Dave Birch turned his attention to the question of money. In future, he asked, who will control it? Traditionally, the value of money has been guaranteed in some form or other by government, historically using large reserves of centrally-held gold. We don’t use gold in that way any more: instead, the productive capacity and economic standing of a nation props up its currency.
But, in Birch’s view, the future of payments will be somewhat different. Money’s centralised character will eventually fall away, and monetary control will flow from governments to other institutions. When you look at what’s happening now, he might have a point.
One way of looking at it is to consider, say, the London Oyster card system, where millions of people have a card that contains a certain pre-paid value, which they use to access services in London’s transport system. Once it is charged, an Oyster card has a value that is insulated from the fluctuations of the financial and economic conditions above ground.