The Theory of Denationalization of Money: From Gold Standard Currency, Fiat Currency to Cryptocurrency

This article systematically explores the relationship between the cryptocurrency system and Hayek's Theory of Denationalization of Money, and compares the characteristics of the gold standard system, fiat currency system, and cryptocurrency system, as well as their applicability to The Theory of Denationalization of Money. This study also explores the impact of the emergence of stablecoins on cryptocurrencies, as well as the compatibility and conflict between stablecoins and Hayek's monetary theory. The final conclusion points out that cryptocurrency validates Hayek's feasibility of non-state institutions competing to issue currency, but also exposes its many limitations. The future development of the monetary system is more likely to move towards a mixed currency system, with national credit guarantees such as CBDC as the main focus, innovation incentives brought by market competition mechanisms such as some cryptocurrencies, and advances in algorithm technology, forming a fusion and complementary mixed currency system. At the same time, policy-making needs to balance innovation incentives and risk mitigation for financial institutions.