Creating Money in the Cyber World

Ever since the birth of the internet, people have been discussing a very intriguing conjecture:
Can humans create money in the cyber world?

Let's explore this question first.

What is Cyberspace?

Cyberspace refers to the new space formed by all people using the internet connecting with each other,
also known as the online world.

Originally, we could only exchange information with each other in this online world, such as videos, news, and chat messages.

One day, someone started thinking:
Could there be an asset native to this cyberspace,
just like gold is an asset native to the physical world?

To figure out if this is feasible, we first need to understand how gold became an asset.

If we understand how gold came to be, perhaps creating money similar to gold in cyberspace is possible!

So, what was the initial reason gold had value?

Why Did Humans Initially Consider Gold Valuable?

There's a theory I find quite reasonable: the "Labor Theory of Value."

According to the Labor Theory of Value, the value of a commodity is determined by the human labor condensed within it.
The mining, refining, and processing of gold require a lot of manpower and time, so the input of this labor gives gold its most basic value.
Even if gold initially had no practical use, it was hard to obtain it for free from miners,
because this gold was the crystallization of the miner's sweat from spending a whole day panning for gold by the river.
If you don't believe it, you'd have to go pan for gold by the river yourself to obtain it,
so that's why people were willing to trade their own goods directly with the miner for gold.

Over time, gold could be exchanged for more and more things, and one or two shops started accepting gold as payment.
The consensus value of gold itself grew higher and higher.

Ultimately, the value of gold is not just the simple crystallization of sweat, but layered on top of the labor value with consensus value.

Gold Value = Labor Value + Consensus Value

By analogy with other things, many items have labor value as their foundation.

For example: I go to the forest to chop some timber and bring it home,
and this timber actually stores my labor value.

Perhaps this piece of timber is more aesthetically pleasing or more durable, and different values are added on top.

So, in cyberspace, if we want to form a currency, that currency initially needs labor value as its foundation,
then it gets accepted by a small group of people, gaining a bit of consensus value.
Gradually, the circle expands, allowing the currency to layer massive consensus value on top of the labor value foundation,
just like gold.

Does the electricity consumption in cyberspace represent labor value?
I believe yes; electricity is a form of energy, and energy itself has value.

For example, if I let a computer run continuously for a month, performing massive mathematical computations, and finally arrive at the correct answer, thereby earning a token, then this token stores the computer's labor value.

This concept was proposed a decade before the birth of Bitcoin. In 1998, computer scientist Wei Dai described an anonymous, decentralized electronic cash system in his B-money proposal, allowing participants to create money by solving computational problems. The value of these currencies is built on the computational labor invested by participants.

Since cyberspace has electricity as labor, as long as that labor is stored somewhere,
creating a currency native to cyberspace is feasible.

(The ideas from 1998 influenced Satoshi Nakamoto a decade later, leading to the creation of Bitcoin.......)

Q&A Time

Q: Why does the government tell me that gold isn't money, and that only government-issued currency is legitimate?

A: No, gold has always been money—it's divisible, homogeneous, and has consensus. Gold possesses the attributes of money.
It's just that in the 21st century today, everyone has lived in the era of fiat currency from birth, so they think money must be issued by the government.
But looking at the entire history of humanity, the current fiat currency is actually a peculiar existence; gold has been used for thousands of years.
Perhaps in the year 3000 AD, when students use brain-machine interfaces to learn about 21st-century history, they will read:
"A thousand years ago was an era where governments issued currency; the right to coin money had not yet separated from the government, and most people believed that only government-minted currency was legitimate..."