Legal Tender Laws

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    Ron Paul advocates the abolition of legal tender laws to allow competing currencies. But what exactly are legal tender laws?
    According to Wikipedia:
    “Some jurisdictions may forbid or restrict payment made other than by legal tender. For example, such a law might outlaw the use of foreign coins and bank notes or require a license to perform financial transactions in a foreign currency.”

    But tit also says that payments can be made in other currencies when this is specified in the contract. So which is true for the US and/or the EU? What would be different without the legal tender laws?


    The government has legal privileges for some monies and legal disabilities for others. Legal tender laws are one type legal privilege. Here is a statement by the Treasury on legal tender:

    On the legal disability side, U.S. courts will not enforce gold contracts:

    Without such legal support, fiat money would not be chosen by people over commodity money.

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