<p>This is impossible.</p>
<p>You want a currency whose exchange rate to <em>all other currencies</em> is fixed. Say that today 1 USD = 0.86 EUR. You are asking for a new currency GGG where 1 GGG = 1 USD, and 1 GGG = 0.86 EUR, always and forever.</p>
<p>Let's suppose the USD crashes so that 1 USD = 0.001 EUR (1000 USD = 1 EUR).</p>
<p>Let's suppose I'm stuck with 100,000 worthless USD. It's only worth 100 EUR.</p>
<p>But luckily, it's not worthless! I can just exchange my USD for GGG; now I have 100,000 GGG. Now I can exchange my GGG for EUR. Now I have 86,000 EUR. Woohoo!</p>
<p>But wait, there's more! Now I can exchange my 86,000 EUR for 86,000,000 USD. Then 86,000,000 GGG. Then 73,960,000 EUR. Then 73,960,000,000 USD. Then 73,960,000,000 GGG. Then 63,605,600,000 EUR. After I run around the currency exchange shops a few more times, I'm a multi-quintillionaire!</p>
<p>At least, until the currency exchange shop runs out of EUR to give me. Then the currency exchange shop will start demanding more GGG before they'll give me an EUR. And they'll give lots of GGG to anyone who gives them <em>back</em> an EUR because they need more EUR and have too much GGG. And that changes the exchange rate.</p>

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2021-09-28T14:30:48.087Z
Really enjoyed your answer, thank you. So there is no scenario possible for truly-fixed currency?
Lorenz
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2021-09-28T14:33:12.080Z
@Lorenz I have just shown you why the idea is basically nonsense
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2021-09-28T14:36:18.767Z
I am aware. Was asking if there is any other idea for possible currency that won't fluctuate
Lorenz
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2021-09-28T14:36:44.590Z
@Lorenz it is fundamentally impossible for the reason I have said. There is no idea.
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2021-09-28T14:19:16.427Z
2021-09-28T14:19:16.427Z
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<p>It's possible, as follows. Let's assume you make the GGG currency. So people come to you and give you $1 and you give them one GGG (assuming people want the GGG, that is). After a while there are X GGG in circulation and you have X dollars. Later, if someone would rather have dollars, they give you Y GGG and you give them Y dollars.</p>
<p>Note: if everyone decides they no longer want GGG, then they all sell them back to you in exchange for dollars. So now there are no GGG in circulation, and you have no dollars; but the exchange rate was fixed 1:1 until the very end.</p>

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2021-09-28T23:22:31.003Z
From what I see you tied the GGG to follow USD rate, and USD itself fluctuate. It doesn't address question as how to make it truly-fixed
Lorenz
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2021-09-29T12:37:50.920Z
@Lorenz Yes the dollar fluctuates relative to e.g. the euro or the yen. But in my example the GGG is truly fixed to the dollar. Do you want the GGG to be fixed to a basket of currencies?
Daniel
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2021-09-28T17:44:50.510Z
2021-09-28T17:44:50.510Z
Daniel
<p>Currency fluctuates depending on supply and demand</p>
<p>In fixed exchange rate, any central banks could ties their currency to another country's currency or Gold price. Which, basically, still fluctuates</p>
<p>In what scenario would it be possible to create currency that is <strong>truly fixed</strong>? For example, create GGG currency that ties 1 USD at today's exchange rate</p>
<p>1 GGG = 1 USD at 9/28/2021</p>
<p>Means at any time onwards, will still be using the same exchange rate</p>

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2021-09-28T13:32:13.040Z
Hi! Did you try to research this? Like did you look up "fixed exchange rate regimes"?
Giskard
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2021-09-28T13:42:18.690Z
@Giskard Hello, yes I did, however I found only examples tied to something that is also fluctuates (gold or other currency). Hence why I ask
Lorenz
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2021-09-28T13:46:53.280Z
It is not possible to create a currency with a fixed exchange rate to USD on 9/28/2021 because (1) if someone requests the exchange we can't travel back in time to give them the currency, (2) if the exchange rate was fixed only on that day that implies it is floating on all other days i.e. it's not actually fixed, and (3) there aren't 28 months in a year.
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2021-09-28T13:55:57.953Z
What I suggest with fixed exchange rate of USD in 9/28/2021 (equivalent to 0.86 EUR), means even IF in next 5-10 years real world currency fluctuate to 1 USD = 0.001 EUR, this 1 GGG currency will still hold the 0.86 EUR. Not possible even in digital (crypto)currency? @user253751
Lorenz
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2021-09-28T13:56:41.773Z
@Lorenz Well that's just called pegging it to EUR instead of USD. You just define that 1 GGG = 0.86 EUR. Then if the exchange rate fluctuates to 1 USD = 0.001 EUR, now 1 GGG still = 0.86 EUR but 1 GGG = 860 USD
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2021-09-28T14:04:08.870Z
I might misphrased the question, should be applied to **entire** worldwide currency exchange rate of 9/28/2021 (1 GGG = 111 JPY ; 6.46 CNY ; 0.74 GBP ; etc). Whatever happen to real world currency in 5-10 years, the GGG should still maintain the exchange rate of today (9/28/2021). Wouldn't it possible?
Lorenz
CC BY-SA 4.0
2021-09-28T14:12:03.960Z
Nope, I think the scenario mentioned is misunderstood. For example GGG is created today, and defined that 1 GGG = 1 USD in 9/28/2021 exchange rate. Which also means 1 GGG = 0.86 EUR; 111 JPY; 0.74 GBP. Even IF in 2045 real world currency, USD crashed to 1 USD = 0.001 EUR, does NOT affect to GGG because it follows global exchange rate in 9/28/2021. @user253751
Lorenz
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2021-09-28T14:13:52.557Z
Actually that would be a USD crash.
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<currency><money><nonexpert><currency-exchange>
Create currency with truly fixed exchange rate
Lorenz
# Create currency with truly fixed exchange rate

(Asked by: username_0 on 2021-09-28)

Currency fluctuates depending on supply and demand

In fixed exchange rate, any central banks could ties their currency to another country's currency or Gold price. Which, basically, still fluctuates

In what scenario would it be possible to create currency that is **truly fixed**? For example, create GGG currency that ties 1 USD at today's exchange rate

1 GGG = 1 USD at 9/28/2021

Means at any time onwards, will still be using the same exchange rate

**Tags:** currency, money, nonexpert, currency-exchange
> **Comments:**
> **username_1**: Hi! Did you try to research this? Like did you look up "fixed exchange rate regimes"?  
> **username_0**: @Giskard Hello, yes I did, however I found only examples tied to something that is also fluctuates (gold or other currency). Hence why I ask  
> **username_2**: It is not possible to create a currency with a fixed exchange rate to USD on 9/28/2021 because (1) if someone requests the exchange we can't travel back in time to give them the currency, (2) if the exchange rate was fixed only on that day that implies it is floating on all other days i.e. it's not actually fixed, and (3) there aren't 28 months in a year.  
> **username_0**: What I suggest with fixed exchange rate of USD in 9/28/2021 (equivalent to 0.86 EUR), means even IF in next 5-10 years real world currency fluctuate to 1 USD = 0.001 EUR, this 1 GGG currency will still hold the 0.86 EUR. Not possible even in digital (crypto)currency? @user253751  
> **username_2**: @Lorenz Well that's just called pegging it to EUR instead of USD. You just define that 1 GGG = 0.86 EUR. Then if the exchange rate fluctuates to 1 USD = 0.001 EUR, now 1 GGG still = 0.86 EUR but 1 GGG = 860 USD  
> **username_0**: I might misphrased the question, should be applied to **entire** worldwide currency exchange rate of 9/28/2021 (1 GGG = 111 JPY ; 6.46 CNY ; 0.74 GBP ; etc). Whatever happen to real world currency in 5-10 years, the GGG should still maintain the exchange rate of today (9/28/2021). Wouldn't it possible?  
> **username_0**: Nope, I think the scenario mentioned is misunderstood. For example GGG is created today, and defined that 1 GGG = 1 USD in 9/28/2021 exchange rate. Which also means 1 GGG = 0.86 EUR; 111 JPY; 0.74 GBP. Even IF in 2045 real world currency, USD crashed to 1 USD = 0.001 EUR, does NOT affect to GGG because it follows global exchange rate in 9/28/2021. @user253751  
> **username_2**: Actually that would be a USD crash.  

---

## 2 answers

### Answer by username_2 on 2021-09-28. Score: 0 | Accepted answer

This is impossible.

You want a currency whose exchange rate to *all other currencies* is fixed. Say that today 1 USD = 0.86 EUR. You are asking for a new currency GGG where 1 GGG = 1 USD, and 1 GGG = 0.86 EUR, always and forever.

Let's suppose the USD crashes so that 1 USD = 0.001 EUR (1000 USD = 1 EUR).

Let's suppose I'm stuck with 100,000 worthless USD. It's only worth 100 EUR.

But luckily, it's not worthless! I can just exchange my USD for GGG; now I have 100,000 GGG. Now I can exchange my GGG for EUR. Now I have 86,000 EUR. Woohoo!

But wait, there's more! Now I can exchange my 86,000 EUR for 86,000,000 USD. Then 86,000,000 GGG. Then 73,960,000 EUR. Then 73,960,000,000 USD. Then 73,960,000,000 GGG. Then 63,605,600,000 EUR. After I run around the currency exchange shops a few more times, I'm a multi-quintillionaire!

At least, until the currency exchange shop runs out of EUR to give me. Then the currency exchange shop will start demanding more GGG before they'll give me an EUR. And they'll give lots of GGG to anyone who gives them *back* an EUR because they need more EUR and have too much GGG. And that changes the exchange rate.

> **Comments:**
> **username_0**: Really enjoyed your answer, thank you. So there is no scenario possible for truly-fixed currency?  
> **username_2**: @Lorenz I have just shown you why the idea is basically nonsense  
> **username_0**: I am aware. Was asking if there is any other idea for possible currency that won't fluctuate  
> **username_2**: @Lorenz it is fundamentally impossible for the reason I have said. There is no idea.  

---

### Answer by username_3 on 2021-09-28. Score: -1

It's possible, as follows. Let's assume you make the GGG currency. So people come to you and give you $1 and you give them one GGG (assuming people want the GGG, that is). After a while there are X GGG in circulation and you have X dollars. Later, if someone would rather have dollars, they give you Y GGG and you give them Y dollars.

Note: if everyone decides they no longer want GGG, then they all sell them back to you in exchange for dollars. So now there are no GGG in circulation, and you have no dollars; but the exchange rate was fixed 1:1 until the very end.

> **Comments:**
> **username_0**: From what I see you tied the GGG to follow USD rate, and USD itself fluctuate. It doesn't address question as how to make it truly-fixed  
> **username_3**: @Lorenz Yes the dollar fluctuates relative to e.g. the euro or the yen. But in my example the GGG is truly fixed to the dollar. Do you want the GGG to be fixed to a basket of currencies?  

---

