![]() This means there is no way for gold to leave circulation in great quantities. Unfortunately (I admit) there are a couple of flaws with this analogy (and coins in general).ġ) There is no external market. This processs causes a contraction in the supply of gold coins, raising their value. People realise that the gold is worth more than the coins, so they melt down the coins to make gold. This situation is similar to the silver nickel one you proposed earlier. Now that gold coins are worth a lot less, people stop making them. The supply far outstrips the demand, and the value of an individual gold coin falls. Suddenly, there is an influx of gold into the economy. Everybody, excited by this new feature, rushes out, mines gold and makes coins. On a server, gold coins are introduced as currency. To be honest though, where supply regulates currency creation, it would level itself out. One solution would be to add a "mint" item, which would stamp the makers name onto every coin, thus forum ops could implement a law about currency making. You hit on one very valid point, that anyone being able to make coins would affect the monetary supply, thus potentially causing inflation. The base components of any currency should never be worth more than the actual currency itself. The reason silver quarters were melted down is because they were a poorly designed currency. A viable currency must also be well balanced and managed by a government. The difficulty in getting them, combined with the increased demand for coin minting, would help restrict coin production.Īctually, enforcement by the people is only (excuse the pun) one side of the coin. It would be a clusterfuck Precious metals, on the other hand, regulate themselves in MC. To resolve this the ops would have to buy up saplings out of circulation and stuff. If they are too free with them, hyperinflation. For example, if the ops restrict the saplings too much, they will become too valuable and unfeasible as a currency. Using kapok saplings and such is unfair, as well as forcing the servers ops to learn some basic economic theory. The idea of coins based on precious metals works very well in a minecraftian economy. If you used dirt as coins, anybody could increase the money supply and you would end up suffering from hyperinflation, which would cripple a servers economy. Anyone ever hear about silver quarters? People would melt them down into bars because the metal was would more then the coin. (for servers I guess you could use something useless that can not be acquired, why not Sequoia and Kapok saplings?) The only way currency works is if it enforced by the people, if people do not use it then why have it. Minecraft already works on the barter system, if you want currency you might as well just use dirt as coins because anything you can get someone else can too. ![]() If coal became extremely abundant and you tied your currency to it. Free floating currencies will always work better because they can change in value compared to their fixing agent. You could (if you wanted) set a baseline for its value (aka 1 gold = 10 coal or whatever) but it's not necessary.Īs a final amendment, fixing your currency like that is generally not a good idea. If we trade in whole ingots, it will be too large increments to be useful, hence breaking a bar down into coins.ģ) Make the Mod shops a last resort, priced well above the going rate.įurthermore, the currency would be backed by its own intrinsic value. We use currency for a reason.ġ) Bartering doesn't work when people have different needs to what is available.Ģ) Gold is not divisible. "What ?!", he exclaims, 1.5 gold ingots for iron ? Oh well, better go buy the iron off of other players He goes to the mod store to buy the iron. ![]() Oh well, nevermind, no small denominations.ģ)Ok, so bob is getting real tired by this point. We only trade in commodities.Ģ)Ok, so bob has some gold, but he only has a bar. The advantages of currency are abundantly clear:ġ) Ok, so you need charcoal, but bob has chickens. Being one of the only people to have discovered a specific commodity on your server, like gold, silver, iron, etc, means nothing, and if you can trade raw commodities to the moderator for coinage or other commodities, you basically have a lowbrow TFC equivalent exchange. Moderator store credit devalues the different commodities, as there becomes an instant and bottomless source of any resource. Trading the currency instead of the actual gold seems redundant. Trading the currency instead of the actual commodity seems redundant. ![]()
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