In a recent interview on Kitco News, Jp Cortez, Executive Director of the Sound Money Defense League, discussed the growing momentum behind the sound money movement in the U.S.
The Sound Money Defense League is a non-profit organization in the United States focused on promoting the use of what is known as “sound money,” primarily advocating for gold and silver to be used as legal tender. They believe that these precious metals offer a stable, intrinsic value, unlike fiat currencies, which are susceptible to inflation and manipulation by governments and central banks. The league supports policies aimed at reducing governmental control over money and encouraging the adoption of gold and silver as part of the monetary system.
One of the core missions of the Sound Money Defense League is to eliminate legal and tax barriers that make it difficult for individuals to use gold and silver as money. This includes advocating for the removal of taxes on the purchase, sale, or exchange of precious metals. They argue that taxing these metals unfairly penalizes those who choose to hold them as a way to preserve their wealth, especially in an economic environment where inflation erodes the value of fiat currency.
In addition to legislative efforts, the Sound Money Defense League works to educate both the public and policymakers about the importance of sound money principles. They emphasize that gold and silver have historically provided economic stability and long-term value, and they criticize modern monetary systems for being vulnerable to inflation and financial crises.
The organization also engages in lobbying at the state level, pushing for laws that recognize gold and silver as legal tender in more U.S. states. They collaborate with financial experts and liberty-oriented groups to advance their cause. Through these efforts, the Sound Money Defense League hopes to reintroduce a monetary system that they believe will protect individual wealth from the pitfalls of inflationary policies.
Additionally, the group publishes the Sound Money Index, which ranks U.S. states based on how favorable their policies are toward sound money. This index highlights which states have laws and tax policies that encourage the use of gold and silver, aiming to push more states to adopt sound money practices.
Cortez began by defining sound money as money that holds its value over time, typically backed by tangible assets like gold and silver. This type of money stands in contrast to fiat money, which is not backed by physical assets and is vulnerable to inflation and manipulation by governments. According to Cortez, sound money is a hedge against fiat currency volatility, providing long-term financial security. He emphasized that precious metals like gold and silver have been reliable forms of money for thousands of years and are crucial to preserving individual wealth.
The conversation moved to the legislative successes in 2024. Cortez highlighted significant victories, such as the removal of sales taxes on precious metals in states like New Jersey and Nebraska. These reforms mark an important step toward treating gold and silver as money rather than commodities subject to sales tax. In Nebraska, Cortez and the Sound Money Defense League quickly mobilized when lawmakers attempted to reintroduce sales taxes on precious metals. Grassroots efforts helped stop the proposal, which came shortly after Nebraska passed legislation eliminating capital gains taxes on precious metals and reaffirming gold and silver as money while blocking Central Bank Digital Currencies (CBDCs). Cortez also applauded New Jersey for becoming the 45th state to remove sales taxes on gold and silver, though he expressed frustration over an exemption for transactions under $1,000, which he argued unfairly penalizes small savers.
Cortez stressed the power of grassroots advocacy in driving these legislative victories. While drafting legislation and expert testimony play important roles, he explained that success often hinges on local residents pressuring lawmakers. The Sound Money Defense League has used this strategy effectively to defeat anti-sound money measures and advance reforms at the state level.
Cortez then turned to the broader trend of de-dollarization and how gold serves as a hedge against fiat currency instability. He pointed to the increasing adoption of gold by central banks and private investors, noting that gold is reaching new highs and is currently trading in the mid-$2,600 range. He mentioned that many countries, especially those involved in BRICS, are moving away from reliance on the U.S. dollar in response to decades of U.S. monetary policy. Cortez emphasized that gold is seen as a reliable alternative to fiat currencies, particularly in light of ongoing inflation and the looming threat of another surge in price levels. States like Utah are leading the way by exploring the possibility of holding physical gold in their treasuries, a move Cortez described as a critical hedge against the instability of the U.S. dollar.
Cortez did not hold back when discussing the future of the U.S. dollar. He described the dollar’s slow erosion as a “death by a thousand cuts,” caused by decades of poor monetary policy and the weaponization of the dollar in international conflicts. He suggested that the dollar’s status as the world’s reserve currency is at risk as countries like China and Russia increasingly transact in gold. While he acknowledged that the dollar is not likely to collapse overnight, Cortez argued that the shift toward alternatives, particularly gold, is well underway.
Despite the progress at the state level, Cortez expressed disappointment at the lack of federal reforms regarding sound money. He mentioned Congressman Alex Mooney’s ongoing efforts to introduce legislation that would end the federal capital gains tax on precious metals and audit U.S. gold reserves. While Cortez praised Mooney for keeping the conversation alive, he was not optimistic about meaningful federal progress in the near future. However, Cortez did stress that if Mooney’s efforts to eliminate federal capital gains taxes on gold and silver succeed, it could have a ripple effect across the states, as most states that still impose these taxes do so because the federal government does.
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