This author explains our obsession with cryptocurrency
The Money Plot by Frederick Kaufman
Source: Other Press
What is money? Why do we need it?
These are some of the big questions that writer Frederick Kaufman explores in his book “The Money Plot: A History of the Power of Money to Enchant, Control and Manipulate“, which was released at the height of the pandemic.
Kaufman, journalist and English teacher, is interested in what we project on money, from our desires for abundance and freedom to – above all – safety and security.
The book comes at a time when our most basic understandings of money are being challenged. (When I hear the word, I always imagine money, not bitcoin. What do you imagine even when you imagine bitcoin?)
One way to get a feel for what’s to come is to look back. And by reading Kaufman’s book, which traces the history of money, you see how bitcoin is not so different from the pearls used as currency 40,000 years ago.
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I recently interviewed Kaufman about his new book. (Disclosure: I was enrolled in one of his courses at CUNY’s Craig Newmark Graduate School of Journalism in 2017.)
The following exchange has been condensed and edited for clarity.
Annie Nova: What’s the main way the money has changed?
FK: Primitive money is very material: it is a feather, it is a pearl. Over time it becomes very metaphorical – a coin, paper money. And then, of course, there is very little material money in the world. Only 5% to 10% of the money in the world is in material form. And then you could say that the end game is cryptocurrency. It has all the attributes of primitive money, it is our security, except that it has no material parallel.
Photographer: Anthony Tafuro
AN: Why do we turn to money for security?
FK: In the Middle Ages, Christians begin to define the future, and it will be the end of the world and the apocalypse. Everything is counting down. It turns the business culture into this focus on expiration dates and think about the money: it’s all about expiration dates. This is when you get paid. This is when your quarterly report is due. It’s all about retirement savings. And a mortgage, of course, is based on, when does it expire? We secure the future and take control of it. This is the essence of what money is.
AN: There’s a cost to that, though, isn’t there? A mortgage is security, but it’s also 30 years of payments.
FK: This is one of the ironies of money. We create this fiction and then we become captives of it.
AN: Is it a coincidence that we have become so much more interested in cryptocurrencies during a pandemic?
FK: If you look at the story of the apocalyptic times, people fly to safety. And that’s the money. Some people see their blanket as gold, others as crypto. Some see it as money. We are also seeing an increase in cash holdings during the pandemic. All of this points to the real essence of money: security, ensuring that we can continue in our status, ensuring that the stories we have about ourselves can continue into the future.
AN: What happens when people’s stories are disrupted?
FK: If you are really looking, why do you have a retirement account? Why are you working? Why are you using money the way you use it? It’s because you are setting a narrative of what you want to be in the future, and when that is cut short due to a lack of money, it’s traumatic. And we see this country going through a huge period of trauma right now.
AN: What do cryptocurrencies have in common with the primitive forms of money you write about?
FK: Primitive money was more of a talisman than a store of value or a medium of exchange. The rings and beads had magical powers to keep the wearer safe in whatever awaited them. Likewise, cryptos play the role of primitive amulets, especially those that have no value, like dogecoin, but still promise to bring good luck. It is interesting to add that when the Europeans first came to settle, they forgot to bring enough money. So, just like those who mine bitcoin, they started making their own wampum.
AN: Why do you think there is so much skepticism about cryptocurrencies?
FK: Money is a story we all believe in. Wall Street told this story and tried to predict how it would end before the rest of us knew the ending. Of course, bankers will become uncomfortable when a new group of shamans and diviners tell a new story with a new ending.