Bitcoin vs Dollar: Donald Trump Stops Production of Pennies in the United States

MAGA. A country where things are sometimes done on a large scale, including extravagance. It’s a bit like the ending of a bad overnight romance: the one-cent coin, the humble penny, has finally died at the US Mint. This decision, as loud as the man who ordered it, namely pro-cryptocurrency President Donald Trump, aims to put an end to the economic absurdity that has had accountants screaming: releasing a coin worth nearly four times its face value!

Key points of this article:

• The US penny was discontinued by the US Mint due to its excessive value relative to face value.
• The decision is intended to save taxpayers $56 million, although it has sparked outrage among collectors and dealers.

Making a penny: When 1 + 1 equals 4 This argument is convincing and justifies the adoption of decisive measures. Cessation of pennies is a measure designed to save taxpayers money 56 million dollars .

On this occasion, the US Treasury Secretary Brandon Beach didn’t mince words when he cut the last copy: “God bless America and we’ll save the taxpayers $56 million.”

The diagnosis is obvious: the penny, introduced in 1793, has lost its former power. Two hundred years ago, it could be used to buy a cookie, candle or candy. Today, it only weighs on our pockets or clutters the bottom of our drawers in a world that:

• uses less and less cash,
• is watching rampant inflation gather momentum
• wants to switch to fully digital payments.

Are fiat currencies on the way out? This murder, no matter how rational it is, is not without some controversy.

On the one hand, we have romantics and collectors those who view these coins as good luck charms, pieces of history to hold in their hands. The end of the penny is the end of a certain idea of ​​fiat currency, a victim of its own success and inflation.

On the other hand, we have retailers which are experiencing a crisis of adaptation. Gone are the days of transactions accurate to the cent! Many had to become impromptu arithmetic experts, adjusting prices or asking customers for the exact remainder. Jeff Leonard of the National Association of Convenience Stores acknowledged this: While his association has been advocating for repeal for three decades, the way it’s been implemented—abruptly and without any guarantees—is far from ideal.

Bitcoin, or the art of scarcity A Melancholy Farewell to the Penny is a powerful lesson about scarcity and value in the digital age. The humble one-cent coin became a victim material hyperinflation : its production costs exceeded the nominal cost by 400%. In terms of profitability, it is the quintessential anti-active.

Faced with this extravagance, bitcoin (BTC) appears as the answer. Its value is backed not by a metal that is expensive to mine and mint, but by a strict code that guarantees its mathematical scarcity. With the limitation of 21 million units BTC is deflationary in nature. Where the US Mint could produce billions of pennies before they became obsolete, Bitcoin’s creator, the mysterious Satoshi Nakamoto, set the limit.

Penny died because he could not remain scarce. Bitcoin will thrive because of its scarcity, and with each halving, its scarcity will increase.

The penny could not stand the contradiction between its cost and value. Digital assets, on the other hand, must ensure that their perceived rarity withstands the realities of their production. An old copper coin teaches us a master class: value does not depend on price, but on actual rarity.

The end of the penny is a modern economic fable. She reminds us that in finance, the production cost of an asset must remain below its face value, or it will self-destruct. At a time when Web 3 dreams of dematerialization of all transactions this small copper coin symbolizes a traditional financial system caught in its own paradoxes. Existing pennies will certainly remain legal tender, but how long before they become common artifacts?

Source: journalducoin.com