We know a lot of people who believe that "evil forces" or some sort of conspiracy are responsible for the fact that most of the world uses some form of paper money. But while there certainly was some conspiring that aided in the transition from precious metal coins to fiat paper currency, we believe the main reason is fairly simple:
For most people in most situations, paper money seems superior to coins.
Paper beats coins
Please consider the actual real world use of coins versus paper, temporarily ignoring any ethical or long term factors. After all, most people don't give them a lot of weight, especially for simple everyday purchases.
Coins are significantly heavier than paper notes. You can carry a large and varied amount of paper notes, but to have the same amount and variety in coins you would need to carry a lot more weight. This just isn't something a lot of people will care to do, especially if they can use something lighter.
Coins are also harder to manipulate. To make all the varieties needed for making change, you have to use different size coins. Coins have been made in sizes from as large as several ounces (31.1 grams per troy ounce) to as small as a few tenths of a gram. The smaller coins are, the harder they are to work with. Just imagine accidentally dropping a gold coin one fourth the size of a dime on the floor (the author has one, produced in 1854).
These are not the only reasons why paper beats coins, but we believe they are enough that the market decided to go with paper. That's right, the market has spoken! No matter how much precious metals backers want it to happen, the masses aren't going to go back to using bulky, heavy coins.
Shire Silver beats paper!
However, as much as the market likes paper money, there is always room for improvement. We believe that Shire Silver represents the next step in the evolution of money.
Since Shire Silver cards are the same size as credit cards, they fit in almost all wallets. People are already used to their shape. In fact, since they are smaller than dollars, they can fit better in most wallets. They aren't too big or heavy to be uncomfortable, and aren't too small to be unmanageable.
In addition, Shire Silver cards are more durable than paper. The outer shell is made of a tough yet flexible plastic that can take more abuse than paper notes can. And while the plastic does burn, you really have to be trying to make it burn.
While Shire Silver cards are slightly heavier than paper notes, they are not so heavy that most people will care.
We strongly believe that Shire Silver cards will beat out paper in an unfettered free market, and can do very well in our current mis-regulated government burdened market.
What about debit/credit cards?
Making our cards be the same size as debit and credit cards brings up a valid question: why won't people just use debit and credit cards?
We expect they will. Heck, we use our debit cards quite often. They are convenient and can be used at almost all retail locations. But they are limited and have some drawbacks.
Infrastructure is required
While most businesses have the machines you need to use debit and credit cards, most people don't. So if you want to loan your buddy a small amount, or collect a pool for getting a couple pizzas for the big game, credit and debit cards just won't work.
Privacy is desirable
Every time you use a swipe card for payment, that transaction is recorded. There are many legitimate reasons why you might not want your bank knowing what you bought, and as many more why you might not want the store you are buying from to know who you are. Maybe you're afraid they're going to sell your information. Whatever.
People desire privacy, and only anonymous cash like dollar bills and Shire Silver cards can provide that.
And Gresham's Law?
Gresham's law is commonly stated: "Bad money drives out good", but is more accurately stated: "Bad money drives out good if their exchange rate is set by law."
We get a lot of people asking about Gresham's Law. They wonder how we can compete against the Federal Reserve note, especially when it is backed by legal tender laws.
The first response we usually have is that we believe our product is so superior that the market will recognize it and ignore that old fogey Gresham. But just as important is that Gresham's Law is more limited than most people understand. In fact, there have been many cases of the reverse of Gresham's law, such as the competitive production of gold coins by private mints in California in the wake of the gold rush.
In addition, our price is not fixed. As the price of precious metals changes, so does our suggested value. And that's important to note as well - we suggest a price but don't demand that other people respect our valuation.
Real Metal means Real Value
But returning to the ethical and long term considerations, these can be strong motivators for the early adopters and opinion leaders.
When a monetary system is based on debt, as the Federal Reserve (AKA dollar) System is, it distorts the incentives inherent in the economy. It rewards going into debt more than the market normally would, causing the economy to grow faster than it should. This creates an economy wide boom and bust cycle that harms lots of people.
But a monetary system based on wealth tends to promote economic growth that is sustainable. While there can be limited booms and busts in certain sectors of the economy, they don't infect the whole economy.