Bitcoiners Remind World of 'Temporary' Gold Window Suspension

Source: EDOYO / Adobe Stock

Over the weekend, some members of the Bitcoin (BTC) and crypto community have commemorated the 50th anniversary of the US “temporary” gold window suspension, aka the Nixon shock, by making the ‘WTFhappenedin1971’ hashtag a trending topic on Twitter – with some calling it the 50th anniversary of the fiat dollar.

On August 15, 1971, then-US President Richard Nixon made a televised announcement in which he effectively ended the gold-based Bretton Woods international monetary system and ushered in a new era of fiat money.

“Prosperity without war requires action on three fronts: we must create more and better jobs; we must stop the rise in the cost of living; we must protect the dollar from the attacks of international money speculators,” he stated back then.

Even though the suspension of the dollar-gold convertibility window was supposed to be a temporary policy, the gold standard has never returned. Many mainstream economists argue that the event marks “the liberalization of capital markets” that was “a giant boon for the U.S. financial system.”

However, Austrian economics-leaning Bitcoiners tend to dismiss the mainstream narrative and instead point to negative externalities of the “new” fiat system.

As reported, many Bitcoiners find that the US and wider global population has largely suffered as a result of this event. The government can print USD at will, in the process causing the kind of inflation that reduces the general population’s savings.

The hashtag ‘WTFhappenedin1971’ is based on its namesake website, wtfhappenedin1971.com, which has a collection of charts and economic data from major sources that posterize the societal significance of the Nixon Shock.

50 years ago today, on August 15, 1971, President Nixon suspended the convertibility of the US dollar into gold.pic.twitter.com/RUsBLCXGl5

— Documenting Bitcoin 📄 (@DocumentingBTC) August 15, 2021

According to Alex Gladstein, Chief Strategy Officer at the Human Rights Foundation, one of the “most striking outcomes of the fiat age” was “the corporate power completely crushing the average worker ever since,” evidence of which can be found in the Bichler & Nitzan’s Power Index that divides the S&P Price and Average US Wage, and has skyrocketed since the 1980s.

This chart based off the work of @BichlerNitzan is a stunning contribution to #wtfhappenedin1971

Yes, that’s corporate power completely crushing the average worker ever since.

One of the most striking outcomes of the fiat age. pic.twitter.com/kxthYGGJI6

— Alex Gladstein 🌋 (@gladstein) August 15, 2021

Monetary historian and crypto-friendly turned scholar Niall Fergusson also opined on the occasion. In his latest opinion piece for Bloomberg, he criticized the recent regulatory scrutiny efforts in the United States and stated that the dollar must go for crypto or risk another Nixon-like “bonanza.”

Fergusson wrote,

“If we have learned nothing else from the past half-century, it is surely that the best way to win a race with totalitarian rivals is not to copy them, but to out-innovate them. Make the wrong decision at this historic turning point, and we shall be interrupting a much bigger bonanza than Nixon did.”

Lina Seiche, Managing Director of the Bitcoin Times illustrated the anniversary with a humorous Bitcoin comic.

Happy 50th birthday fiat dollar 🥳 #wtfhappenedin1971 pic.twitter.com/0sat9s1xIy

— Lina Seiche (@LinaSeiche) August 15, 2021

Even the CEO of Twitter and Square, Jack Dorsey, helped to bring attention to the issue by Tweeting the hashtag.

#wtfhappenedin1971

— jack⚡️ (@jack) August 15, 2021

You can watch Nixon’s full address here:

Other reactions:

Bad news doesn’t get better with time. #wtfhappenedin1971

— Warren Davidson (@WarrenDavidson)

So… the US government going to re-open the gold window right?

1971 was temporary, right? #wtfhappenedin1971

— Stephan Livera (@stephanlivera) August 15, 2021

I’m sad my parents did not know #wtfhappenedin1971 because I grew up saving fiat money on piggy banks, and then in actual banks when I was old enough.

But now, when I have kids, I will be teaching them how to save in Bitcoin, and that is a huge step in the right direction.

— Camila Campton✨ (@camilacampton) August 15, 2021