Economists and regulators warned the Iraqi currency was a gamble, but punters still paid high fees to own an illiquid currency that some thought might just become the most valuable in the world.

Instead, it was devalued by 20pc in 2020.

Sound familiar? The dinar is on economists` minds again as the cryptocurrency market reels from its latest crash with $2 trillion of value wiped off a market rife with fraud, theft and highprofile corporate collapses, including FTX and BlockFi. The parallels aren`t just about laser-eyed speculation, but the dinar`s historical development as a medium of exchange. While optimists such as investor Bill Ackman see crypto making a comeback if the right technological use case comes along, Iraq`s experience suggests that the survival of any form of money depends more on faith in the institutions backing it.

(Adapted from `Crypto`s Future Could Look Like Iraq`s Past,` by Lionel Laurent, published on November 30, 2022, by Bloomberg)