This dickhead Hobbes wrote a book called Leviathan about social contracts if you’re interested that answers your question
Basic idea is humans tend to bend to an authority when we’re promised a degree of ‘peace and security’.
We bend to governments and currency is a tool of delivering us peace and security.
Paper money not having meaning (hyperinflation) and governments being overthrown go hand in hand – it’s happening right now in Sri Lanka, happened a bunch in a few African countries over the last decades.
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