What meant that the dollar was convertible into gold only?

Answer 1

When the dollar was convertible into gold, it meant that holders of U.S. dollars could exchange them for a specific amount of gold, establishing a fixed value for the currency based on gold reserves. This system, known as the gold standard, provided stability and trust in the currency by tying its value directly to a tangible asset. However, it also limited the government's ability to print money freely and respond to economic changes, as the money supply was constrained by gold reserves. This system was largely abandoned in the 20th century, leading to the current Fiat currency system.