Bitcoin Vs. Fiat’s Best: The Norwegian Kroner

Bitcoin Vs. Fiat’s Best: The Norwegian Kroner

[heading]Bitcoin Vs. Fiat’s Best: The Norwegian Kroner[/heading]

A “safe” fiat currency? There can be no such thing…

Or can there?

First of all, a nation’s currency is issued by its central bank, and a central bank, just like an ordinary bank, has assets and liabilities.

Assets that a central bank might have are things such as government bonds and gold. A central bank’s liabilities include the nation’s money supply, known as central banks ‘notes,’ even though most of these exist digitally these days.

Like any bank, a good central bank holds high quality assets, with little debt. Assets should exceed liabilities by a long stretch. This is known as a bank’s capital ratio. A bank’s capital ratio is a bank’s margin of safety in the event of a crisis.
Norwayeconomy

The more well-capitalized a bank – that is, the higher its capital ratio – the safer the currency.


According to the aforementioned data, the “safest” fiat currency, arrived at by Sovereign Man, is the Norwegian krone.

Norway’s central bank – the issuer of the krone – has one of the highest capital ratios of any central bank in the world at 23.3%. ┬áThere is also no debt on the bank’s balance sheets.

Norway, moreover, is not a part of the European Union, so it does not use the euro and cannot be held liable for another nation’s fiscal conditions.

NorwegianKroner

The Krone is unpegged – that is, it is not pegged to any other currency, so it can’t be dragged down with a sinking ship.

Or can it?

That remains to be seen. One thing is for sure, the Norwegian krone is still managed from the top. This means that it’s issuance is subjective and at any time the managers of the Norwegian economy, or their bosses, can demand a change in monetary policy within Norwegian borders.A Brief History of Bitcoins and What Comes Next for the Controversial Online Currency - New Bitcoin World, Latest Bitcoin News, Free Bitcoins info, ASIC Mining Info, Bitcoin videos

With Bitcoin, which has no debt, and lots of assets in terms of network power and limited supply, there is no subjective reality. Sure, the entire community could make a change. But, this, practically, would take much more than an act of Congress.

Although Norway is not as far along as the Federal Reserve in the US (which prints more than $80 billion per month in USD), nor as cumbersome as the European Union, it still depends on a state run economy.

Bitcoin depends on the technology and time.

 

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