Fiat Is Fragile? Sounds Like a Magic: The Gathering Card
Silicon Valley Bank is the latest woe to make headlines and cause panic throughout the financial industry. It has made many people question whether “fiat” — that being government-backed currency — is safe and secure.
But What About Those Precious Magic Cards?
The truth is, no type of currency is 100% fool-proof — digital or otherwise. We’ve seen other popular forms of digital payment systems, like Bitcoin and Dogecoin, rise and fall in value at a rapid pace. Not to mention the beloved Magic: The Gathering cards, which also can gain or lose value in a moment’s notice.
The Ripple Effects
The collapse of Silicon Valley Bank has caused major concern due to its “contagion effects” — that is, its ability to hurt other financial institutions by virtue of its size. People are now left wondering if this collapse will lead to a bigger financial meltdown like the one we experienced in 2008.
What Can We Do to Prevent This from Happening Again?
Proposals are already being made to increase oversight and regulations of digital currency exchanges and financial institutions. Here are a few ideas for what we can do:
- Increase transparency: Make financial records more public and subject to public scrutiny.
- Strengthen oversight: Strengthen the regulations of the institutions handling fiat currencies and digital currencies.
- Have more safeguards in place: Ensure that customer funds are stored separately and in case of future financial disruptions, customers’ funds are still available and usable.
Fingers are being pointed in every direction right now, but the only thing we can do as a community is to take preventative measures and make sure that future financial disasters don’t happen again. Nonetheless, it’s always good to still hold onto your Crystals and Relic Tokens from Magic: The Gathering, just in case.
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