That's a bold claim to throw out there with nothing to back it up. Gold has been used as a currency for thousands of years. Crypto-currencies are out there working whether you like it or not. To say that they can't work is pretty silly when they are literally working right now.
> they would require taxes be paid in the _coin of the realm
First, you should source this since it sounds like you are talking about a specific country at a specific time in history.
Those were usually made of gold and silver. Why do you think coins have cleated edges? It's so people can shave them off without someone knowing.
Also countries used gold to transact between each other, no matter what they tried to press on their citizens. The longest any fiat currency has lasted is around 300 years, most don't last 50. Our current world wide currency system is only about 40 years old. The transition came after Charles DeGualle started to reclaim France's gold after the Vietnam war because he feared the US didn't have enough gold to redeem their dollars. Nixon was forced to take the US off the gold standard completely and our current system was born.
But not supporting a robust market economy until it (and other metals) were reduced primarily to accounting units for many transactions, so the real “currency” was, in substantial parts, debt instruments, not actual gold. I mean, this is true even in emergent pre-capitalist market economies, which were fueled by (and fueled, in a positive feedback loop) the development of banking.
There is a huge difference between a commodity currency like gold and a commodity-backed currency like gold-denominated debt instruments.
[0] http://www.conchsoc.org/interests/shell-money.php
People that keep saying a currency that doesn't have a central authority leeching off of it by printing more and using it however they want perplex me. If all else was equal, would you choose to put your money in a currency that continues to be worth less and less or a currency where that is designed to not be devalued?
You can say it won't work all you want, but when people have a choice of what currency to use, they aren't going to choose one that is meant to inflate. The only reason people use inflationary currencies is because they don't have a choice.
You need to connect the dots and explain yourself, which you don't seem to be doing.