The Three Jobs of Money

Ask most people what money is for, and they'll say: to buy things. That's one job. But money actually has three — and once you see all three, saving, inflation, and Bitcoin all start to make more sense.

The first job is trade. Money lets you buy and sell easily, without hunting for the perfect person to swap with. You hand over money, and the seller takes it — because everyone takes it. This is the job we all know.

The second job is measuring value. Money puts a price on everything. How else would you compare an hour of a doctor's time with a loaf of bread? Money gives us one shared way to measure worth. Every price tag is money doing this job.

The third job is storing value. This is the one most people forget, and it's the one that matters most for your life. Good money should hold its value over time. You work today, and you should be able to save that money and still spend it next year — or after you stop working.

Here's the problem. Modern money does the first two jobs well enough. But the third? It fails. A dollar saved in 1971 has lost more than 90% of its value today. It could still buy things and still measure prices — but it didn't store value.

That gap, between what money promises and what it delivers, is exactly where Bitcoin comes in.

Tomorrow: why did gold become money almost everywhere on earth?