The world’s economy is dependent on currency. In a world of 257 countries, there are only 180 currencies available not including cryptocurrencies and precious metals and stones from gold, diamond, and other precious metals. As much as a lot of people do not know, the forex market is truly one of the major factors affecting the world economy but there are a lot of currencies flooding the market. Forex has a lot of problem especially when it has to do with exchanging, like converting Yen to Dollar, Cedis to Rands, Yuan to CAD and so on, so could there be a point were the world will be using a single currency as that looks like a preferable solution to the forex problem?
From using gold, cowries, seashells, and other means of transaction to fiat and then cryptocurrency, it has become an easy thing to trade internationally and locally but still why haven’t we started using the same currency worldwide. Using a single currency isn’t a new thing, from the days of using gold as a general means of payment, also the European Union has adopted the use of the Euro as their major currency.
Just as tech has improved so has the currency improved. From barter to the use of gold coin, coins, paper, and then electronic money. In all this, friction is the reason why a lot of countries do not trade with one another. Before the Euro became the central currency in Europe, it was difficult for European countries to do trade just like it is in most part of the world. The Italians wanted to use the Lira to trade even among European countries, the Germans wanted to trade with the German Deutsche mark and so do other countries wanted to trade with their native currency.
One problem with using different currencies worldwide is the use of currencies in international trade before payments. If a country agrees on a price with the buyer and seller having a currency value of 1:0.7 respectively and to be paid in the sellers currency, only for the value of the sellers currency to drop and the price becomes 1:1.2, this is where the comes to be a problem. Having a universal currency can solve this volatility problem.
What do you think about having a universal currency?
Do you think it will aid more trade?
Will corruption not be a problem with using a universal currency?