Tether and the Historical Parallel of Currency Debasement: Lessons from Henry VIII's Coppernose
By
Stephen Cecchetti, Kim Schoenholtz
The bagel they save for the regulars. Don't skim, savour.
Summary
Stephen Cecchetti and Kim Schoenholtz draw a historical parallel between Henry VIII's debasement of silver coinage in 1544 (earning him the nickname "Old Coppernose") and modern-day stablecoins like Tether (USDT). The article argues that just as Henry's subjects hoarded pure silver coins and paid with debased ones, crypto users may similarly prefer better-backed stablecoins (like USDC) over Tether when trust is lacking. The piece explores how debasement of currency — whether physical or digital — leads to Gresham's Law dynamics where bad money drives out good.
Key quotes
· 3 pulledIn 1544, Henry VIII began debasing England's silver coinage to fund his wars.
The new coins were mostly copper beneath a thin silver wash.
Henry's subjects responded as people usually do to the debasement of their means of payment. They hoarded the older silver coins and paid with
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