Bitcoin seems to fit the definition of an energy-backed currency proposed by a famous American inventor during the interbellum period.
In 1921, American industrialist Henry Ford proposed the creation of a “energy currency” that could serve as the foundation for a new monetary system, eerily similar to Satoshi Nakamoto’s 2008 Bitcoin (BTC) white paper’s peer-to-peer electronic cash system.
Bitcoin as a source of energy
The New York Tribune published an article on Dec. 4, 1921, outlining Ford’s vision of replacing gold with an energy currency that would end wars and break the banking elites’ grip on global wealth. He planned to accomplish this by constructing “the world’s greatest power plant” and establishing a new currency system based on “power units.”
According to Henry Ford, who founded Ford Motor Company in 1903,
“Under the energy currency system, one dollar would be equal to a certain amount of energy exerted for one hour. It’s simply a matter of thinking and calculating in terms other than those dictated by the international banking group, to which we have become so accustomed that we believe there is no other standard to which we should aspire. “When Congress cares to hear about it,” he said, the specifics around currency values will be worked out.
Despite the fact that Ford’s vision of a fully backed currency was never realized, Bitcoin appears to have vindicated the concept a century later. Since 2009, energy-intensive mining has produced more than 18.8 million BTC, which requires computers to solve increasingly complex math problems. The alleged environmental impact of this proof-of-work mining process has sparked outrage, but this is a short-sighted claim that ignores Bitcoin’s ability to accelerate the transition to renewable energy.
Gold is being phased out, and wars are coming to an end.
Ford explained the link between gold and war as follows:
“The fundamental evil of gold in relation to war is that it is controllable. When you break the control, you put an end to the war.”
Some of Bitcoin’s most ardent supporters believe that the cryptocurrency’s sound money principles could prevent wars by limiting the government’s ability to fund them through inflation. While a gold standard makes it more difficult for governments to inflate their currencies, “international bankers” controlled the majority of the bullion supply, as Ford explained. Financial elites were able to create an active money market through this process of controlling and accumulating valuable commodities, which thrived during wartime.
President Richard Nixon of the United States abandoned the gold standard in 1971, announcing that his government would temporarily suspend convertibility between dollars and bullion. The so-called “quasi-gold standard” would last until 1973, with all references to gold being removed by 1976. The gold standard was effectively abolished by the British government in 1931, with the United States following suit two years later.
On Saturday, the New York Tribune article went viral on Reddit’s r/CryptoCurrency page, where it received a lot of love. While Satoshi Nakamoto never mentioned Henry Ford in any of his online forum posts, some Reddit users speculated that the late industrialist influenced Bitcoin’s creator. Given Ford’s apparent belief in reincarnation, some joked that Satoshi was actually Ford’s reincarnate.