• 4. 5. 2025 • H. T. •
Most people use the words currency and money interchangeably, but they’re not the same! While they’re closely related, understanding the distinction can change how you think about value and wealth.
🔹 Currency – This is a representation of money, like paper bills and coins. It has value because governments say it does, but on its own, it has no intrinsic worth. It is a medium of exchange, and unit of account, but NOT a store of value. It is mostly loosing purchasing power because of ‘printing’ new currency. If trust in a currency disappears, its value can vanish overnight!
🔹 Money – This is a broader concept that represents store of value, medium of exchange, and unit of account. Money can be currency, but it can also be gold, silver, or even digital assets – anything widely accepted in trade and capable of holding long-term value.
Why does this matter? Currencies can lose value due to inflation or bad economic policies, but money (like gold or other stable assets) retains value over time. Understanding this difference helps make better financial decisions and ensures real wealth preservation!
