There are four types of monetary systems:

Public ledger - #Bitcoin

Private ledger - #CBDC

Commodity-based

Commodity-backed

Here is a high level description of each.

A public ledger system is permissionless (i.e. the system is open to anyone who wants to participate). Transactions and the creation of #money is recorded and validated by a decentralized network of computers. #Bitcoin is an example of such a system, where transactions are recorded on a public ledger called the blockchain. This type of system is apolitical, voluntary, and totally transparent. Every transaction can be audited by anyone with a computer and an internet connection.

A private ledger system is a permissioned (i.e. closed) and highly centralized system. Transactions and the issuance of money is managed by a central authority (i.e. central banks), using digital currency. Transactions records are private and not accessible to the general public. Central Bank Digital Currencies (#CBDCs) are an example of such a system, where the central bank issues and controls the money for use within its respective country. This type of system is political, involuntary, and opaque. Participants have to trust the central planners to not abuse their power and debase the value of their money. The risk of such a system being implemented are, state surveillance and control, erosion of the freedom to transact.

In a commodity-backed system, the money is directly linked to a physical commodity such as gold through a fixed exchange rate or convertibility. In other words, the paper money issued by central planners is redeemable upon demand for gold held in reserves. The gold-backing provided confidence in the currency maintaining its value and limited the ability of central banks to print unlimited amounts of money which needed to be backed by gold.

In a commodity-based system, the value of money is directly tied to a physical commodity, typically gold. The value of the money in such a system is determined by the supply and demand of the commodity. Think of the gold standard, which ended in 1971. The value of currencies was tied to the value of gold, meaning that their value was determined by the amount of gold reserves held by a country's central bank. It’s important to note that in such a system there is no convertibility of the currency to gold. The price of gold is simply used as a reference to establish the value of the currency. This system as history shows displayed fragility given the ability of central planners to circumvent constraints that would have been more rigid under a commodity based monetary system.

We will likely never go back to a commodity-based or backed monetary system. Among the two remaining choices we have, #Bitcoin    and #CBDCs, only one will save us from total surveillance and control. Bitcoin!