Gresham’s Law Bitcoin El Salvador

Austrian economists have long been interested in the study of money and the processes of monetization. The last global monetary standard that developed largely through market forces, gold, occurred well before the Austrians had performed their work on the topic. The advent of the digital monetary network known as Bitcoin gives the Austrian the utterly-rare opportunity to observe the reordering of global economic life as an emergent sound money takes aim at slaying the existing fiat structures.

Like an analysis of any other topic, it is critical to understand and apply the foundational principles of Austrian economics to properly develop conclusions about the monetization process of bitcoin. A study on the effects of minimum wage laws cannot be trusted without a firm grasp of the law of demand; likewise, the study of the recent law in El Salvador making bitcoin legal tender requires the proper application of Gresham’s law.