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| Money-Dragons are tiny, pleasant, but very, very shallow |
Overall quite pleasant creatures, their love of lucre has made them so shallow that they can live quite happily in the two-dimensional habitat of paper money.
This makes them invaluable to goblins, the wizarding bankers (as discussed by Ms Rowling in her historical works).
Gringotts has no need of intricate engravings or watermarks for its paper currency. The money-dragons residing in the notes are taught a complicated dance corresponding to the serial number on their specific note, which they perform only when asked by an official goblin. Notes can, in this way, be infallibly authenticated.
Money-dragons eat economists' hats, which is a job that economists, for efficiency, outsource.
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