Justification of physical currency in an interstellar civilization?
I have seen a similar-ish question on here, but it doesn't quite match my inquiry.
Suppose you have an interstellar civilization (the means of travel between stars being stable two-way wormholes on the outer edges of each system), which has somehow also circumvented the light speed problem for communications. In other words, there is an interstellar internet equivalent present, so anyone anywhere can indeed communicate instantaneously with anyone else, digitally.
Also assume that this civilization descended from our world, albeit several millennia ago. Obviously, economies that far in the future aren't guaranteed to resemble anything we recognize, but let's assume the presence of fiat currency does exist.
What would be a justifiable reason for there to be at least small-scale, limited usage of physical currency in the form of coinage or minted bills, when for the most part, digital currency is honestly more convenient (even in our comparatively primitive world)? Assume that this digital currency is pretty much tamper-proof, protected by honest-to-god quantum encryption and other means that make it risk-free.
Excuse the verbosity, I felt things needed clarified for a comprehensive answer!
This post was sourced from https://worldbuilding.stackexchange.com/q/146411. It is licensed under CC BY-SA 4.0.
1 answer
Global Usability
However advanced your average tech level, you probably still have a few people that can't afford "” or for whatever reason, don't use "” the necessary equipment to deal in digital currency.
Privacy
Cryptocurrencies are complicated and their value isn't entirely stable. (It's also not inconceivable that your technology has advanced to a point that makes cryptocurrency impractical for whatever reason.) Cold hard cash has always been the ultimate "untraceable" currency. As long as there is crime, or just people that want their spending habits to remain "discreet", there will be a demand for cash. (Take a look at how David Weber's Honorverse deals with this for a good example. The "cash" there is in the form of credit chits, which are something of a hybrid between physical cash and cryptocurrency.)
Given that tech advances create an arms race between currency issuers and forgers, your "cash" is likely to be either a) something similar to "credit chits", or b) something that has a very high value-per-mass that is both easy to authenticate and cost-prohibitive to reproduce. The latter category has included salt and gold at various times in history. Note that this can be something that anyone can make, as long as the production cost is on par with its trade value, especially if its something that your civilization consumes.
Ultimately, keep in mind that the only purpose of currency is to simplify a barter economy. Even if there isn't a standard form of "cash", you can still have commerce that doesn't involve exchange of digital currency. "Money" is just a convenient way to assign value to stuff so that a) there is less dickering over prices/values, and b) it is easier for me to trade your money for what I actually need than to re-trade whatever alternate form of compensation you can offer.
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