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From Babylon to Bitcoin: some philosophical reflections on the ontology of money

Dean Rickles
p. 89-102


This (somewhat polemical) paper focuses on the ontological nature of money and draws comparisons to the ontological status of gauge freedom in physics. The parallels allow us to move beyond the social constructivist theories of Searle et al., and thereby avoid some pitfalls with such views. Since we have a reasonably good grasp of the ontological features in the physics context, we can pull back lessons from there onto the economic domain. In general, we find that this approach offers a nice lens through which to view the ontological peculiarities of money.

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1. Introduction

  • 1 Though it can have many sources, inflation is the result of actus homo sapiens rather than actus de (...)

1Most of the world is experiencing alarming levels of inflation.1 The value of money is not what it was. While not quite in the condition of Robinson Crusoe in the quotation above, the $10 note in my wallet can buy far less than an identical $10 on the same day last year. It has less purchasing power, despite the fact that it has only undergone what Peter Geach (1969) labelled “Cambridge change” (that is, no inner change at all, but change in virtue of something external to its changing). Inflation is not surprising: creating new money to fund excessive government spending, as is occurring in my country of residence for example, can surely lead nowhere else. And the root of this is, of course, the ability to create debt – a gift (or, as I believe, as should you, a curse) bequeathed to us from our Babylonian ancestors (see, for example, Bromberg 1942).

2The Babylonian temples were very much mixed up with money, not least via offerings, but also through the priest’s own dealings, which included interest-bearing loans. Though there were interest-free loans in the Babylonian era, we know that this was unusual. The Sanctuary of Ishtar lent for interest-free periods followed by 20% interest, if not paid within that period (Bromberg 1942: 85). The rules were encoded in The Code of Hammurabi, as established by King Hammurabi of Babylon. Much of our present system of banking finds its way back here. To a large extent, the kinds of money available can determine the direction of civilizations. But they can also be themselves determined by such directions. Witness the advent of crypto currencies which are considered to be an indispensable part of the new digital world order (with blockchain technology forming an essential part of the transformation). Often these developments are presented as inevitable evolutionary steps. And it is quite true that certain developments in one part of the system demand changes elsewhere, but ultimately the monetary system is a system based on conventions that must be adhered to for its function, but certainly not one grounded in physical necessity – it is “entirely discretionary and based exclusively on the expectation that others would accept it too” (Goldberg 2005: 957).

3In the call for papers of this special issue, the editors refer to a scene from The Wolf on Wall Street where, about the stock market, the following point is made: “it’s fairy dust. It doesn’t exist. It’s never landed. It is not matter. It’s not on the element chart. It’s not real.” I agree with them that it is not quite right to speak of unreality and non-existence here, and the same can be said about money. Like fairy dust, money depends on our believing in it in order to bring it into being, but once we do this it has real consequences. However, I do not think that institutionalist/constructivist accounts are up to the task of providing ontologies since there are laws of money that such social convention ontologies don’t seem powerful enough to explain. For this reason, I draw from econophysics, albeit from a non-standard source of physics – gauge theory – that contains the right balance of convention and reality. We draw some unfavorable conclusions from this analysis about our orthodox money system.

2. Money and gauge freedom

  • 2 This can, of course, apply to entire nations just as readily as individual humans – take a look at (...)

4After various transmutations, we find ourselves contemplating entirely abstract monetary systems (such as bitcoin and other cryptos), with no grounding in tangible physical items at all – though one might see the absurd claim that the cyber security of the system somehow grounds them in reality. Money becomes bits of information which, like words for Humpty Dumpty, can amount to whatever you want them to. If you’re unfortunate enough to be poor, they amount to a life of misery, forever chasing an ever-accelerating goal (that is, freedom from debt when that minus sign disappears from your balance).2 Yet, it matters not whether our tokens are digital or paper. It matters not whether we go “cashless”, for this is merely representational fluff.

5As John Smithin notes (2006: 1), a shift to a so-called “cashless society” does not mean that we have changed the substance or ontology of money, but rather its form. Encoded in this way of thinking is the idea that money is abstract, and has representations that simply serve to make the abstract more concrete through realization. In this sense it is much like the principle of a gauge in physics. There, we have some abstract structure embodied in a gauge symmetry, which amounts to a multiplicity in the possible realizations of the physical structure, where the realizations amount to picking an unphysical gauge. The classic example is the electromagnetic potential: basically, many potentials can represent one and the same physical electric and magnetic fields. Moreover, the zero is chosen arbitrarily, and it is only the potential differences that have physical significance. As in the case of physics, in financial economics, too, a gauge is selected for convenience. This is a rather curious situation: we are using what is a kind of mathematical model with no basis in reality as if it were reality. But note that much of our society is built like this. The Greenwich Meridian line defines much human behavior. It determines an entirely arbitrary zero, but once fixed (one gauge fixed, so that some set of coordinates is selected) it is far from arbitrary. This too is a form of creation from nothing.

6In this sense, cryptocurrency has no impact at all on the more recent versions of the classical debate on value, such as “commodity theory” versus “credit theory”. Value, like the meaning of information, is a relational property, involving such tokens and agents, embedded in a system of conventions and standards that involve agents who choose to imbue such tokens with special significance, though which have no absolute value independently of this meaning-fixing process – at least, this will be the view espoused here. The assignment of values in this way is one kind of modelling, much like the other kinds of mathematical modelling we find in science in which some coordinates are used to get a grip on reality, introducing an overlay on a world that can then be impacted by the (completely arbitrary, in absolute terms) modelling choices we make. In particular, as with coordinates in gauge theories, there is no absolute value for fiat money, and the value-system is only assigned ontological significance as part of a relational structure (the overlay). If enough agents decided not to adopt this convention, the tokens become like Robinson Crusoe’s “worthless drug”.

3. The intangibility of money and its consequences

  • 3 A US Federal Reserve Note used to state that the note was redeemable in gold on demand from any Fed (...)

7Our chief concern in this paper is with this curious intangibility of money (qua fairy dust) and especially with the ability to lend and spend what one does not have in real tangible terms that results from it. We have in this case an economy of non-being which somehow still manages to possess ontic force, in a manner akin to bio-looping. When you or I write out a cheque for payment, it is incumbent on us to have sufficient credit in our accounts to cover it, for it is this that supplies the token with its value: what it represents grounds its value. Not so the Federal Reserve for which the act of writing the cheque is an act of creation, albeit of something that remains abstract (that is: a representation of something that remains non-concrete) while still able to get a foothold in the world of concrete objects.3 Fortunately, this feature of money (that is, fiat money) maps directly onto the notion of a gauge symmetry and gauge freedom in physics. We have a reasonably good grasp of the ontological implications in this context, so given this mapping we can pullback lessons from physics and philosophy of physics onto the economic domain. This is compared to the extant literature on the social construction of money and the idea of institutional ontologies, and we find that the gauge approach offers a nice lens through which to view this better-known work.

  • 4 The editors of this special issue constituting a notable and welcome exception, of course.

8Philosophers have thus far tended to shy away4 from wandering too far into the political and social minefield of fractional banking on which the whole illusion rests. If all debts were payed off, there would, by construction, be a money supply of zero. However, for all banks to pay all debts back would be impossible since they do not own what they lend in isomorphic, 1-1 correspondence between tokens and assets.

9Our monetary system is, quite clearly, a case of creatio ex nihilo, though not quite in the way as is often assumed, since as we said already, the creative act generates only an abstract entity. Simply stated, fractional banking is the idea that a bank need not be restricted in its lending habits by what it itself owns as real capital. It can, instead, take deposits from its customers and use a large fraction of that deposit to make a loan to another customer on which it, rather than the original depositor, will gain large interest payments (with the depositor gaining a far lower rate of interest). The fraction which is kept by the bank is called the “reserve”. In other words: a fraction of a deposit paid to it will be kept and a fraction will be exploited for bank’s own gain. Now: imagine what would happen if all depositors requested their deposits back, as (in most cases, excepting term deposits) is their right? The bank could not pay out, as mentioned. Depending on the fraction it must keep in reserve, it could be very far from being able to do this. An individual performing such financial prestidigitation would be branded a criminal. Depending on the total amount of assets, a central bank will regulate the percentage (fraction) that must be held in reserve at all times. Of course, this is supposed to be chosen to reflect the volatility of the market in the event of a surge in depositors making withdrawals.

  • 5 At the time of writing [July 26, 2022], Zimbabwe has attempted to control its 200% inflation rate b (...)

10This is our system. Frankly, it stinks. And since we are speaking of the reality or not of an entity, it is right and proper for philosophers to take a look: it is a question of ontology. Moreover, it is a system that has done unimaginable damage to our world, while providing little benefit to humanity, beyond a handful of immensely wealthy individuals and the lending institutions themselves, who remain curiously protected from their mistakes, ever bailed out by taxpayers. It has influenced the health of the planet and the creatures that inhabit it. The purpose of this paper is to provide philosophers a rough outline of this system, together with its philosophical ramifications – especially as concerns a topic that has received philosophical discussion: the nature and value of money. While the intention is to focus on ontological issues, to do with the nature of money and value, it is hard to steer clear of moral questions when dealing with such subject matter. I see no reason to try to steer clear: how we carve up the world will naturally often have radical moral implications. Some carvings appear to be more or less forced on us by the world’s kickbacks. Not so the money system. I see no reason, either, to disguise my views in this regard: banking should involve substantive entities (entities linked to truth and reality as closely as possible),5 in a way I shall explain later. Our current notion of money, as employed in daily life, is ontologically dubious. We assume it is not because it obeys rules and has an impact on ontologically non-dubious things, such as our ability to live comfortable lives. Ontologies can clearly have moral weight, positive or negative. Since financial ontology is something we have control over, it is surely incumbent upon us to choose the one that makes life go the best for humankind as a whole – surely it seems difficult to think about a better criterion to define what is right and wrong with social arrangements, such as economies and their ontologies, than measuring them in light of their capacity to allow and to promote human flourishing?

4. Ontology of money

11The focus of this special issue is ontology. Most readers will know Quine’s famous characterization of ontology in terms of “what there is” (Quine 1948). But of course, “is” is itself a somewhat slippery customer. Do we mean “is” in the sense of concrete? In the causal web? In our best scientific theories? Better I think to avoid such issues and use a far older definition: ontology is the science of being (or, re-read Quine’s “is” as “Being”). Our concern as ontologists is then turned to the ontological status qua Being of various things. With my philosophy of physics hat on, I might ask about the ontological status of spacetime points, for example. With my rather broader-brimmed philosophy of science hat on, I might ask about the ontological status of laws of nature. With my Sombrero-style philosophy hat on, I can perhaps ask about the status of objects and properties. Here, we are concerned with money, and with the various concomitant properties and objects linked to money (markets and so on). There are several theories that aim to provide an answer to the question “What is money?” (and the related issue of understanding the value of money, which is obviously entangled with the answer we give to the former question since we must suppose that the ontological elements will ground the value elements). Let us briefly review these here, for our own view will be somewhat different, though sharing elements of at least one.

4.1 Credit theory

12The basic idea of credit theory is that money functions in a representational way, as a token, existing only as part of a contractual obligation to repay to holder of the token. There are two specific theories that fall within the credit theory’s umbra, which are social constructivist theory and chartalist theory.

  • 6 The most famous critique of such a view is provide by David Hume (1752) in his Political Discourses(...)

13According to social constructivist theory, the fiat money system is based on the idea that something counts as money because we say it is. It has value by decree, and we must agree. But there are still principles that must be met. Instead, according to chartalist theory, since the credit theory demands the creditworthiness of the issuer of money tokens, it is argued on that the State has to be the issuer because one has to be able to trust the issuer.6

4.2 Quantity theory

14Quantity Theory can best be encapsulated via Irving Fisher’s exchange equation, which simply states that MV = PT, where M is the money supply, V is the rate of exchange of money or the velocity, P is the price level, and T is the transaction volume. This means that the money supply is perfectly balanced with the demand for money. In plain words: if the money supply (that is, the quantity of money) doubled, then we should expect the price level to double also, so consumers will find themselves paying twice as much for the same (and so the value of tokens halves and more are needed in transactions).

4.3 Commodity theory

  • 7 Note that this approach requires enough of the metal to back the money in the first place. Given ou (...)

15Commodity Theory grounds money in the notion of medium of exchange. It is the substance itself that carries the value, rather than what it represents, as with the credit theory. We might call this view an intrinsic theory, in contrast to the extrinsic credit viewpoint. An example of such an approach is Metallist Theory, according to which, the value of money is given by its concrete representation in gold or silver (as mentioned above). In other words, its value derives from the value of the metal used to represent it, giving us a kind of identity theory. While gold and silver are usual, all that matters is that the representative possesses the qualities one requires for money: scarcity and intrinsic or independent value.7 Note that Metallist Theory can, according to Schumpeter, be divided into both “theoretical” and “practical” subcategories according to whether the link between money and commodity-backing is one of logical necessity (that is, an analytic truth) or something merely normative that we should strive for (Schumpeter1954: 288).

4.4 Ontology vs contours of an ontology

  • 8 As much as there are parallels to gauge theory, which we turn to in a moment, there exist also pote (...)

16I don’t wish to go into any detail concerning the pros and cons of these theories. I will simply point out that they do not themselves offer strong ontological claims about money, giving something more of an account of the structural outlines. They make broad claims only, concerning whether money’s value is internal to the tokens or not. We might view them as dividing into in «money as doing” (functionalist accounts) and “money as being” (or substantivalist accounts). Functionalist accounts clearly end up offering laws of money or expressions of the control parameters (yielding changes in response variables, such as spending), rather than ontologies per se.8

  • 9 Phil Armstrong and Kalim Siddiqui (2020) have recently argued that, contrary to my claims here, mon (...)
  • 10 The very naming of fiat money highlights its ontological status for us: it is an unbacked currency. (...)

17Modern developments in money seem to push one inevitably towards some kind of credit theory.9 Why? Because as already mentioned, fiat money is not a redeemable token but has its value, as the name suggests, by fiat. Its role as legal tender depends on the banking system which serves in a certain sense to guarantee its legitimacy.10 While I am not a fan of such a system, it must be noted that the fact that such systems are possible is quite remarkable. It highlights the meaning-making role of the human mind, which can make one thing mean anything we like. In this sense, money is like information. The bit strings are open-ended until we assign meaning. As John Searle puts it, following J. L. Austin’s speech-act theory, money always requires a declaration (Searle 2010). This is, of course, what grounds the problem Robinson Crusoe faces: declarations involve multiple people and trust. It is a collective agreement. However, here we face something of a problem in that neither the credit nor the commodity theory leaves poor Crusoe better off in many cases. Fiat money is no better or worse than gold and silver in his case – though, certainly, if Crusoe did eventually encounter others, then it is more likely that gold and silver would impress them more than pieces of paper which might be meaningless to them, unless they are embedded in the system of trust from which the paper originated.

18Cryptocurrencies, such as Bitcoin, clearly violate the metallist principle, as do most modern currencies. Bitcoin is, at best, supported by blockchain technology and regulations on supply. This is often described as being “backed,” but it clearly is not in any ordinary sense – this way of presenting things is simply more sleight of hand, pulling us into a deeper illusion than old-fashioned fiat currency in which, as Sanat Kumar, writing for the World Economic Forum writes, “someone’s wealth could disappear in a click”.11 There is no isomorphism between real assets and bitcoin, with the former forming a small fraction of the latter. This is akin to David Hume’s notion that the backing is moral (of trust and civilization, here, supposedly enforced by computing protocols) as opposed to ontic (of objects). We face all of the same pitfalls as a result of this, as with fiat money: easy inflationary and depressive scenarios, including bubbles and crashes.

19To a large extent, we can lay down a set of criteria that something must satisfy to qualify as a suitable realization or model of money. For example, we might expect of tokens: durability, portability, divisibility, uniformity, limited supply, and community acceptability (it must perform in its key function, understood since at least Aristotle’s Politics (1255b-1256b), as a medium of exchange, a store of value, a unit of account, and a standard of deferred payment). Given the various criteria that must also be met, a purely social ontology of money is not sufficient. There are principles that must also be met that the social rules must themselves satisfy. Money also satisfies laws that go beyond the merely social, such that again the social behaviors must implement them. In other words, the quantity theory of money is correct in its attention to such laws. Its problem is simply that it goes no further than these laws, which are expressed as very high-level generalizations. They point to, at best, a description of the structural outlines of an ontology of money. A pure commodity theory, however, clearly cannot account for the obvious social contribution to the ontological status of our present system.

5. Gauges, standardization, and relative facts

20While we tend to think in our everyday lives of most quantities as having their values in an absolute sense (that is, the weight and dimensions of this laptop I’m typing on), this is only because the standards and units (the gauges) that define our reality become part of the ubiquitous background (once we fix a gauge). The idea of a background structure is an old and venerable one. For example, Albert Einstein postulated a “reference mullusc” (consisting of a coordinate frame holding a lattice of clocks) to localize and thus render into physical observables various quantities that otherwise would remain purely formal. This, like any system of standards, aims for the same basic goal: an invariant way to localize relative quantities so that different observers can agree on what it is they are talking about.

  • 12 Money in this sense fails what we might call “the Philip K. Dick” definition of reality, namely: re (...)

21We bracket out the ubiquitous standard which grounds such value, enabling us to compare and contrast these values at spatial and temporal separation. Money should be no different in this sense. And yet, in our present system, it is: it is not grounded in a standard, but is an ever-shifting, complex bundle obstructed by a plethora of currencies and exchange rates. We began with a quotation from U.S. Special Commissioner of Revenue, David Wells, who wrote a delightful book, Robinson Crusoe’s Money, explaining basic concepts of finance and the concept of money and its value. Of course, as Wells nicely summed up with the quote we began with, it is the relative utility of the money, as compared with the knives, that sets their worth. We quickly see that the utility of fiat money comes extrinsically (meaning that it is a relative concept), while the knives have theirs intrinsically. Without a mechanism of exchange, the money is worthless. Indeed, on the desert island, neither the money nor the knives can be said to have a price on them as such, for a market is required to set such a thing. In the context of physics, it is gauge theory that sets relative values for quantities that themselves have no absolute values. If we are viewing them from Elizabeth Anscombe’s (1958) distinction between “brute” (what I prefer to call absolute) and “institutional” (what I prefer to call relative) facts, they are firmly on the side of institutional: it requires intention to specify a gauge, and this involves human baggage.12 But, it is more extensive than Searle’s intentional, speech act theory of money since it requires a widespread coordination more akin to measurement standards than the rules of chess. I note that this gauge-theoretic approach bears some resemblance to Uskali Mäki’s idea that money is to be understood in terms of “institutionally sustained causal powers”. Mäki notes that “the existence of the money universal is dependent on a larger institutional structure and cannot be understood in terms of collective belief or acceptance or agreement separately focusing on money” (Mäki 2020: 247). I agree that a deeper institutional structure is required, more along the lines of an established standard of measurement, for example. Barry Smith (2014) has also discussed document acts (a non-ephemeral version of speech acts) as another approach that might overcome some of the shortcomings of Searle’s theory. However, though an advance over Searle, and despite the lip-service paid to “quasi-abstract” entities, I find this idea too concrete to pick up the necessary aspect of arbitrariness in the process of gauge-fixing.

22The gauge aspects can quickly be seen by considering what would happen to the value of money if all prices were shifted uniformly by the same amount (that is, if a global transformation were applied). Of course, nothing would happen: the transformation would be value-symmetric. This is essentially a change of the units. In the so-called Gold Standard, the idea is to provide a fixing of the standard that all can agree on. As Karl Marx once put it:

The first chief function of money is to supply commodities with the material for the expression of their values. It thus serves as a universal measure of value, and only by virtue of this function does gold, the commodity par excellence, become money. But money itself has no price. As the measure of value and the standard of price, money has two distinct functions to perform. It is the measure of value inasmuch as it is the socially recognized incarnation, of human labor; it is the standard of price inasmuch as it is a fixed weight of metal. As the measure of value, it serves to convert the values of all the various commodities into prices or imaginary quantities of gold. As the standard of price, it measures those quantities of gold. (Marx 1906: 106)

  • 13 We often choose specific coordinates in physics, for example in Einstein’s general theory of relati (...)
  • 14 A possible reaction to the gold standard might be that it stifles growth, shackling it to the amoun (...)

23Marx is simply expressing the orthodox idea of standardization: gold essentially gives us our zero and our units and does so in a physically-motivated way. It is not a necessary standard (we could choose others), but it works as a standard for its preciousness and for the well-fitting amount of gold.13 Money must involve a specification of its units, without which there are no grounds to exchange goods for money. Standards allow for communication at a distance in this way. Given this choice of standard, which fixes value in an objective manner (minus the fact that the choice of gold is a subjective factor), there ought to be a 100% mapping between the money supply and the gold supply, so each unit of currency is backed. Not to do this beckons fraud and exploitation.14 Certainly this is the view of the so-called “Vienna school”. On the other side is the “Chicago school”: print money at a steady rate, regardless of the increasing separation between the money supply and its backing by real assets. If there is not 100% real-asset backing, then there is no such thing as the free market. The monetarist approach of the Chicago school naturally involves government intervention. The claim is usually that such controls are needed to avoid inflation and stabilize the economy. That clearly is false.

  • 15 And, indeed, was moved around several times before finally settled upon. I’m trying to avoid unnece (...)

24That money involves social convention does not imply the absence of real laws applying to it once the convention is initiated. Indeed, once selected, then necessity does operate, and it is on this account that Searle’s theory (and Smith’s extension) falls short. Just as the convention of treating the Greenwich (or Prime) Meridian as our zero, while being perfectly contingent and unphysical outside of its standardization,15 it becomes the basis of charts and maps, which use the prime meridian as a reference standard, on which transport routes run, governing significant sectors of society. Once established we can quickly see how an unphysical line has the power to constrain (in a lawlike way) how we engage with the world on a physical level.

25Money in this sense is like information, as I suggested earlier. For example, consider the old trick of leaving a tie on a door handle, known by many housemates sharing a house while students. By established convention (between the housemates), that tie means I have a “friend” over and require privacy. By other conventions it could mean many other things: infinitely many things, in fact. It could be a reminder to put the garbage bins out, to call someone, etc. The information is not in the tie itself. Indeed, the tie will remain the same while the conventions could change, much as currency can be devalued while the tokens (the bank notes for example) are untarnished. There are interesting looping effects that arise as a result of the conventional nature of finance. For example, a group of agents embedded in a financial system can be drawn into speculative bubbles or crashes, which are generated by their actions as a result of their complicity in the system. They are reacting to their collective properties which themselves are rooted in the convention. Sanso (2018) has argued that since machines can also generate such extreme events, we cannot attribute to them the collective behavior of intentional agents. However, the algorithms, as well as the results generated (the extreme events) are still firmly rooted in the conventions. A financial crisis, as much as any other financial event, is grounded in the agreement about what the tokens mean. It is akin to the witch trial hysteria in which the response depends on the agreement that such things can exist and have certain powers.

6. Conclusion

26We have a financial system that seemingly benefits those who are able to use it to place individuals and even entire nations into perpetual debt. But recall the tie-on-the-door convention from earlier. All it takes is for individuals to not adopt the convention for the whole system to fall apart: we are always free to not play this game. It is by choice (and no small degree of coercion, it is true) that a convention-based ontology has power; the non-social world plays only a dependent role (amounting to a fixing of a gauge) in this. Even the apparently very real and serious implications of financial events, such as bubbles and crashes, are extreme events only relative to the convention: no buildings will be torn apart, as they will with earthquakes. We can choose to take them seriously, or not. I would suggest that an ontology that has this feature, of not clinging onto reality itself, is quite obviously going to face problems. But at the very least, if we choose to select ontologies that do not track Being (and it is a tall order to find such a system which can match the conventional system in its ease to navigate and control), then we ought to employ those that lead to flourishing. I doubt anyone could say that this is true of our current system. Yet in some ways the fact that our financial ontology has this freedom is as much a blessing as a curse, since it implies that the world of finance is far more plastic to meet our future needs than if it were grounded more solidly in reality.

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Anscombe, G.E.M. 1958, On brute facts, “Analysis”, 18: 69-72.

Aristotle Politics; in J. Barnes (ed.), The Complete Works of Aristotle, Princeton, Princeton University Press, 1984.

Armstrong, P., Siddiqui, K. 2020, The case for the ontology of money as credit: money as bearer or basis of “value”, “Real-world Economics Review”, 90: 98-118.

Bromberg, G. 1942, The origin of banking: religious finance in Babylonia, “The Journal of Economic History”, 2: 77-88.

Caffentzis, G. 2021, Civilizing Money: Hume, his Monetary Project, and the Scottish Enlightenment, London, Pluto Press.

Geach, P.T. 1969, God and the Soul, London, Routledge & Kegan Paul.

Goldberg, G. 2005, Famous myths of „fiat money”, “Journal of Money, Credit, and Banking”, 37: 957-967.

Harari, Y.N. 2011, Sapiens: A Brief History of Humankind, New York, Harper.

Hume, D. 1752, Political Discourses, London, The Walter Scott Publishing.

Marx, K. 1867, Das Kapital. Kritik der politischen Ökonomie; Eng. trans. by S. Moore, E. B. Aveling, Capital. A Critique of Political Economy, New York, The Modern Library.

Mäki, U. 2020, Reflections on the ontology of money, “Journal of Social Ontology”, 6: 245-263.

Quigley, C. 1966, Tragedy and Hope: A History of the World in Our Time, New York, Macmillan Publishing Company.

Quine, W.V.O. 1948, On what there is, “Review of Metaphysics”, 2: 21-38.

Sansò, G. 2018, What is a speculative bubble?, “Symposia Melitensia”, 14: 367-376.

Schumpeter, J. 1954, A History of Economic Analysis, Oxford, Oxford University Press.

Searle, J. 2010, Making the Social World: The Structure of Human Civilization, Oxford, Oxford University Press.

Smith, B. 2014, Document acts, in A. Konzelmann Ziv, H. Schmid (eds), Institutions, Emotions, and Group Agents, Dordrecht, Springer: 18-31.

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Wells, D.A. 1876, Robinson Crusoe’s Money; Or, the Remarkable Financial Fortunes and Misfortunes of a Remote Island Community, New York, Harper & Brothers.

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1 Though it can have many sources, inflation is the result of actus homo sapiens rather than actus dei. An interesting take on the background to the prevailing economic system that seems so conducive to inflationary scenarios can be found in Quigley (1966).

2 This can, of course, apply to entire nations just as readily as individual humans – take a look at list of countries by external debt: (accessed: 24 January 2023).

3 A US Federal Reserve Note used to state that the note was redeemable in gold on demand from any Federal Reserve Bank. No such claim is made on the newer notes. What does that mean? That the note itself is not backed by tangibles.

4 The editors of this special issue constituting a notable and welcome exception, of course.

5 At the time of writing [July 26, 2022], Zimbabwe has attempted to control its 200% inflation rate by converting the money supply to gold coins (a “metallist” approach to monetary value – see below). These coins – “Mosi-oa- Tunya” or “The Smoke Which Thunders” – should serve to stabilize the economic freefall by grounding value in reality (setting up an isomorphism between token [or representation] and type [or what is represented]), with gold’s desirability and scarcity (set by an internationally agreed value) establishing appropriate features for coinage. Care must be taken in allowing multiple currencies with differing intrinsic values as a result of Gresham’s Law that bad money drives out good. There is also the issue of greater interests in protecting the current fiat (that is, unbacked) money system, so one can expect some attempted interference.

6 The most famous critique of such a view is provide by David Hume (1752) in his Political Discourses. However, Hume’s view, in regard to his fellow Scots that is, was that the controllers were simply too uncivilized to be able to trust to produce unbacked money tokens – unbacked by real assets, that is: it is backed by a promise which depends on the fact that not everyone will wish to be paid at once (in which case, there would be not enough in the money supply to pay: the real assets constituting a fraction of the token’s value). That is, Hume was opposed to the credit theory on moral rather than ontological grounds (a point made by Caffentzis 2021: 123-124). Hume’s view is somewhat complex, but fits best within the mold of constructivism/conventionalism with the commoditist add-on that “men and commodities are the strength of any community”.

7 Note that this approach requires enough of the metal to back the money in the first place. Given our current fiat system, and the fact that debt is so high, the currency would have to be radically devalued (or gold radically upvalued) first in order to be backed. Using coins made from the materials is a safer method than gold-backing a bank note since the value exists in the currency itself and there is no problem with not being able to exchange a bank note for its gold equivalent (for example, in times of crisis). This is why a common strategy to preserve the value of money during times of extreme inflation, is to exchange the money for tangible goods that embody their value, rather than receiving it vicariously through convention (as below) or through promise of exchange (which can only really be guaranteed in the good times).

8 As much as there are parallels to gauge theory, which we turn to in a moment, there exist also potential and unexplored parallels (also with overlap with gauge theory) with the interpretation of spacetime theories. There we find functionalism, relationalism, and substantivalism about space and time and curiously matching reasons for choosing them: do we want an ontology based on what spacetime does (functionalism), or rooted in some actual substance such as points or a physical metric field (substantivalism), or instead a system of conventions (relationalism)?

9 Phil Armstrong and Kalim Siddiqui (2020) have recently argued that, contrary to my claims here, money just is credit (or debt). This is a simple functionalist reduction. Their argument is that money has never been about things, but has always been an expedient to save costs in trade. To think that money has thinghood status is to make a category mistake: “money is credit and nothing but credit.” What the view amounts to, ontologically-speaking, is a kind of dual-aspect view of money: debt and money are two sides of the same underlying substance. Now: while I think we could quibble with the “blankness” of their claims, the main point here is whether we want a descriptive account or a prescriptive account. Yes, money as it is understood today (that is, from a descriptive perspective) is not about things: that is the point of my paper. But the further point is that maybe it should be!

10 The very naming of fiat money highlights its ontological status for us: it is an unbacked currency. It is the value that is bestowed on the currency by fiat. For this to occur, of course, there must be a certain level of stability and trust. As Yuval Noah Harari puts it: “money is the most universal and most efficient system of mutual trust ever created” (Harari 2011: 180).

11 (accessed: 22 September 2022).

12 Money in this sense fails what we might call “the Philip K. Dick” definition of reality, namely: reality is what stays when you stop believing in it. Remove belief, and the subjective frames, and the phenomenon of money vanishes. In this case, we can view the presence of a gauge symmetry as a symptom of unreality.

13 We often choose specific coordinates in physics, for example in Einstein’s general theory of relativity, on such physically well-motivated grounds (given the system we wish to represent, such as some gravitational waves, for example), despite the fact that the theory makes it clear (through a gauge symmetry principle known as general covariance) that any such choices are physically equivalent. The coordinates are chosen for convenience and can be transformed one to the other without altering any physically observable facts.

14 A possible reaction to the gold standard might be that it stifles growth, shackling it to the amount of gold or silver available. Debt allows for explosive growth. Indeed: growth in unequal measure and in damaging measure. Economists obsess about growth as if it were self-evident that it ought to be a goal of an economic system. Yet as we know from natural systems, governed by endogenous principles of regulation, equilibrium is the preferred state. Balance is best. Harmony rather than growth.

15 And, indeed, was moved around several times before finally settled upon. I’m trying to avoid unnecessary technicalities here, but let me point out that the (arbitrary) gauge fixing used to pick a prime meridian or zero on the Earth is a way of rendering longitude a (global) gauge symmetry – the process is a little more complicated than this suggests, since one must map the Earth’s surface to a standard unit 2-sphere and then pick an orientation, a zero-point pole, and then a prime meridian. Once selected, by George Airy in 1851, Greenwich physically determined the evolution of multiple aspects of human life and continues to do (albeit now using the International Reference Meridian) as the zero for GPS technology.

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Notizia bibliografica

Dean Rickles, «From Babylon to Bitcoin: some philosophical reflections on the ontology of money»Rivista di estetica, 84 | 2023, 89-102.

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Dean Rickles, «From Babylon to Bitcoin: some philosophical reflections on the ontology of money»Rivista di estetica [Online], 84 | 2023, online dal 01 février 2024, consultato il 15 juin 2024. URL:; DOI:

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