Here’s a breakdown of how I think minecraftian economics would work because that’s fun. It’s inspired by how a server I play on handles it and general headcanons and inductions.
Most economies are based on a standard of “if a material is rare enough and has some use, it will be a unit of currency” in most cases these units are coins (they’re made of anything metal) But in the case of diamonds and emeralds, full gems are used. Redstone is often compressed into a dissolvable disc that breaks apart with enough pressure. Lapis is carved into portions that can be used for enchanting. These forms of currency are not valued because they are rare but valued because you can uncraft them and turn them into something valuable. Metal coins can be made into weapons and armor, same with diamonds. Emeralds are often valued only because villagers do. Redstone and lapis are valued for machines and magic respectively.
Anybody can print or uncraft money. If somebody finds a ton of gold they can craft it into coins and spend them with a trader. Inflation is less of an issue if you have other countries to trade with. If your nation has a surplus of gold and a nation somewhere else has too many diamonds, you can exchange those units.
It’s basically an advanced form of bartering. It’s founded on the idea of “everybody needs these sorts of materials to some extent so anybody would trade for them”
Ooooh, love this idea!! ^_^