I'm a pretty educated guy and have spent a lifetime in technology and I would say every one of your questions is perfectly valid! I do know that you can 'manufacture' digital currency; you can 'mine it' on your computer (very abstract concept but it happens). It's actually hard to do and takes a lot of resources (processing power). But - you can literally dig gold out of the ground, so how does that work? To me, this talk of 'gold backed' is really no less arbitrary than with a digital currency.

Edit to add: Doesn't most gold come from mines in South Africa? In which case, why isn't SA the wealthiest country in the world!?

I'm a pretty educated guy and have spent a lifetime in technology and I would say every one of your questions is perfectly valid!

I do know that you can 'manufacture' digital currency; you can 'mine it' on your computer (very abstract concept but it happens). It's actually hard to do and takes a lot of resources (processing power).

But - you can literally dig gold out of the ground, so how does that work? To me, this talk of 'gold backed' is really no less arbitrary than with a digital currency.