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I dont know much about cryptocurrency, but I know it is controversial. There are people on both sides.

Is there historical evidence that paper money faced a similar thing? Were there people that initially opposed/argued against the use of paper money?

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    I suspect you mean fiat money rather than paper money. There are still some parallels (the same can be said of any major innovation), but paper money originated out of convenience intended for redeeming specie (hard money) from banks. Cryptocurrency is closer to fiat money, which are deemed to hold value without being actually backed by anything of intrinsic value - just like crpytocurrencies aspires to be. Accordingly there are similar debates around both. Nonetheless, there's still a key difference in that fiat money has been declared legal tender by force of government. – Semaphore Aug 5 at 5:22
  • What research have you done? – Mark C. Wallace Aug 5 at 10:12
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Marco Polo was, famously, amazed when he first encountered paper currency during his travels. In this respect he started a long tradition -- why would anyone accept this rather than something tangible like metal. The Khans, it should be noted in passing, solved that problem by sentencing those who refused it to death. Modern states solve the same problem by requiring taxes be paid in fiat -- and, as noted by Semaphore in a comment, by making it legal tender.

The topic is way too broad to go through the details, but basically yeah: there was plenty of debate. (There still is, in fact. If you seek out writings from the libertarian schools of economic thought, you'll run into plenty of gold bugs who are adamant that fiat currency is worthless.)

With that in mind, you simply cannot compare the two. Crypto -- or at least BitCoin -- has a very low transaction rate, which rules out general use. And current mining operations, which are necessary to conduct transactions, consume more electricity than Denmark. It might have some uses down the road but it's simply not the future.

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    Paper money doesn't have to be fiat - it can be a genuine promissory note. – Display name Aug 5 at 6:44
  • @Orangesandlemons: indeed, though for the purpose of this question (crypto backed by nothing) and in the context of fractional reserve banking (which basically made a farce of the promise symbolized by the note) I do not think that looking into the difference is interesting. (You're most welcome to add your own answer if you think otherwise.) – Denis de Bernardy Aug 5 at 7:22
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    wasn't disagreeing with answer, just noting that worth clarifying that the point is fiat rather than paper money. – Display name Aug 5 at 8:12

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