All three gains from digital money for the people—in purchasing power, economic stability, and added value from investing the money’s stored value—will ultimately come from using digitally-handled stock-based money.

The purchasing power of stock-based money will grow as the population grows, as people grow more productive, and as the underlying stocks grow in value.

The economic stability of stock-based money will come from the fact that stock-based money will be actual ownership of productive assets, which can’t be created out of thin air, so stock-based money will be stable; it won’t cause boom-bust cycles.

(Note that boom-bust cycles have long been produced by unstable, inflated government money, and have long caused significant short-term losses in stocks. Such economic-cycle-driven temporary losses in stocks’ purchasing power will become a relic of the past once the money that’s in widespread use can’t be inflated.)

The eventual move to stock-based money could be speeded up if people would first transition to gold money backed by 100% reserves. This transition step would quickly free us from government money, bringing stability. On the other hand, this transition step might not even be necessary.

Many people, by investing directly in mutual funds, or by having pension plans, already allocate significant portions of their holdings to stocks, to earn stocks’ superior long-run returns [25]. Some of these savvy investors will gladly be the first adopters of stock-based money.

Stock-based money will end up substantially increasing the overall investments in the underlying companies, and these companies will produce substantial increased value for customers. Once all money is stock-based money, the total investment in all companies will have doubled [26].

To gain the full potential from this doubled investment, this investing must be done well. This will require that enough individuals choose their own portfolios. Here’s how this will work best.

Before I buy a product, I will have my stock-based-money balance invested in my custom portfolio, and the seller will have his stock-based-money balance invested in his custom portfolio. I will sell a fraction of my custom portfolio that has the same value as the product’s price, and buy a fraction of all the world’s publicly-traded stocks that has this same value. I will transfer these stocks to the seller. The seller will sell these stocks and will buy for his custom portfolio a fraction of stocks that has this same value.

The common unit in which products are priced will be a prespecified fraction of the world’s publicly-traded stocks; say, a femtoshare (a 10^-15 share). But for all the people who keep their stock-based money in custom portfolios, such femtoshares will be bought only momentarily to transfer value from buyer to seller and then will be immediately sold. These people’s actual stock-based money will be their custom portfolios. This money will grow in value.

Buyers or sellers who don’t want custom portfolios will hold their stock-based money balances as femtoshares. This money will also grow in value, exactly as fast as the world’s overall stock-market capitalization would grow.

Money is exchangeable [27] stored value [17]. Money must not be an instrument of government tyranny. Our store of money must be an investment that yields people the best-possible returns.

Computing and communications have gotten vastly-more economical [28]. Using these advances to produce stock-based money will help us all add value dramatically faster.