Therefore, they cannot be fully embodied in any algorithmic system. Any valuation must come down to a choice by acting man, so our system of exchange must be comprehensible to humans. The idea that every consumer will have to be equipped with sophisticated arbitrage tools and be constantly evaluating such choices is a daunting one. The difficulty that strikes me here is that current governments have a strong interest in maintaining the importance of their fiat currencies. Should E-Gold or a similar arrangement actually offer serious competition to fiat currencies, governments would be strongly motivated to destabilize this competitive currency by whipsawing the gold market through massive buying and selling.
Governments are, of course, a constant threat to any independently evolved money.
Their resources, while finite, are still vast. A key underpinning of their power is their monopoly over the issuance of money within their jurisdictions. This is not something they will surrender lightly, and we can expect that they will be willing to devote significant resources to crushing their competition, through means fair and foul. Well, no, actually just through means foul, which will, of course, be presented to the public as being eminently fair. Fitzgerald raises intriguing possibilities, and is to be commended for doing so.