Close this search box.
The non-fiat money that stopped Hitler (almost): Part 1 of 2 

The non-fiat money that stopped Hitler (almost): Part 1 of 2 

You know how it begins. Germany loses the Great War and the Allies exact a huge price in reparations, which Germany can’t pay from its gold reserves.


The non-fiat money that stopped Hitler (almost): Part 1 of 2 

A while back, I had a phone call with my friend William Freedman. He’d done some work for me in connection with my investment banking firm, Xnergy. I had an idea for a crypto project and knew that he had some experience in the blockchain space, so I gave him the pitch to see if we could work together on the white paper. 

What if, I asked him, currency could be backed by hard assets with stable prices? As principal owner of Primior, I have title to some prime real estate which, I argued, is a better store of value than gold, no less the “full faith and credit” of any political institution. 

He agreed. 

“It’s the perfect asset to back a true cryptocurrency,” I said. 

He agreed. 

“It’s never been tried before,” I said.  

And that’s where he disagreed. 

“There’s nothing new about the function these digital coins perform, just the form,” he said. “The only thing new is the digital part. And they might even prevent the next Hitler.” 

Then he told me the following story. We’ll break into two parts for digestibility but, if you want a more condensed version, see the USP white paper, pages 5 and 6

Apply Prussia to the wound 

You know how it begins. Germany loses the Great War and the Allies exact a huge price in reparations, which Germany can’t pay from its gold reserves. From that point, we tend to skip past the boring, numbers story and go straight to the Robert Mitchum movies. But the numbers are important. 

German hyperinflation didn’t start as soon as the Versailles Treaty was signed. That just accelerated the inflation which had existed since 1914. As the war began, the Kaiser’s government took the preemptive action of taking the mark off the gold standard, so then inflation first took root. The imperial court declined to fund the war by raising taxes — much as the Johnson administration failed to do during the Vietnam era. The economic result of the inevitable wave of massive debt was the same, although more pronounced in the 1920s vintage. The military result was likewise the same in result and degree. The political result, in one case, was abdication of the imperial throne, a lifetime of exile, and the rise of an ineffectual government which acceded to a brutish totalitarian regime that plunged the world into another generation of total war. In the other, Richard Nixon. So pick your poison. 

Still, inflation was merely bad, not Hieronymus Bosch apocalyptic. Germany didn’t so much lose the war as tire of it. The western front was always in France and the low countries, so Germany came out of it with its industries and infrastructure in place. In other words, it was poised to grow itself out of any short-term economic woes. 

The real story of German hyperinflation took years to shape up. It wasn’t until late 1922 that it became unmanageable — by that I mean, when the imperial treasury missed its first payment. The Allies then did what any lien holders would do: They foreclosed. French and Belgian troops marched into the Ruhr valley and took over Germany’s most productive manufacturing region. Even then, hyperinflation wasn’t inevitable. The French and Belgians figured that the factories would be cash cows and, just by operating them, the occupiers would reap all the monies they were owed. The Ruhr valley Germans, however, didn’t much like the arrangement and refused to work. That means the Allies didn’t make a dime on it and kept pressing the new, feckless Weimar Republic for payments. 

That’s when it all fell apart. By late 1923, the mark was worth one-trillionth of its value from 10 years before. 

This led to some pretty surreal denominations being printed, up to and including a 100 trillion mark note (at the time, the word “billion” was used when today we’d mean “trillion,” and “milliard” was used when we’d mean “billion”). I’m not sure that having your face on that cheaper-than-toilet-paper currency is an honor but, if it is, it went to renowned patriotic figure from Germany’s glorious past, Willibald Pirckheimer. 

I never heard of him either. 

Turns out he was Erasmus’s lawyer and led a volunteer force in the Swabian War of 1499. 

Nor have I ever heard of that. 

Turns out, Pirckheimer’s side lost. I know Germans today live with the stereotype of having no sense of humor, but surely somebody in 1923 must have at least read about irony somewhere. 

Skipping ahead? Here’s the part with Hitler 

Which brings us to the founding myth of the Third Reich, that is, the Beer Hall Putsch. 

The short version is, on November 9, 1923, Adolf Hitler led 2,000 supporters of his Nazi Party in an uprising against the Bavarian state government. The mob massed at the Burgerbraukeller in Munich and marched toward the defense ministry, but it was intercepted by a detachment of 130 state police officers. At the cost of four officers, 16 insurgents were killed. Hitler sustained injury when the man he was marching arm-in-arm with died of a chest wound, dislocating Hitler’s shoulder as he collapsed. 

Hitler managed to escape but was arrested for treason two days later. Pardoned by an appeals court, he was released in December 1924. 

Time served in Landsberg Prison wasn’t exactly a hardship. Hitler wore civilian clothes, stayed in a suite that looked nothing like a typical cell, met with whatever visitors he wanted and was jailed along with many of the same people he’d be spending day and night with anyway. What happened outside during his year at the Heil Hilton, though, was making his entire political brand irrelevant. 

In that time, the Nazis went from holding 32 Reichstag seats to 14, a number which continued to drop during the remainder of the 1920s. What was happening in Germany to turn the populace away from fascism? 

We’ll finish the story next time. 

U.S. Property Coin (USP), a project of real estate development and management firm Primior, anticipated to be the first Securities and Exchange Commission-regulated, asset-backed security token drawing underlying value from real estate, providing investors a complete, transparent, stable and highly liquid digital asset that has the potential to appreciate over time and deliver yield by default. 


Join Our Newsletter:

You've joined our newsletter.

Thank you for joining our newsletter! We will send you monthly insights, updates, and feature launches directly to your inbox.

Primior Application Form

By submitting this form, you agree to our Privacy Policy.

Before you can schedule a call...

Before you are able to schedule a call with our team, you must first complete our Investor Alignment Assessment.

Complete Assessment

First, complete the investor alignment assessment.

Schedule Strategy Call

Next, pick a day and time for a strategy call.

Work With Primior

Finally, you will be able to work with our team.

Contact Us Now

By submitting this form, you agree to our Privacy Policy.