[Freedombox-discuss] freedombox currency (was FreedomBox and Bitcoin (and the petition))

[Daniel Pocock]

On 12/11/12 13:43, Natanael Arndt wrote:

>>> We are trying to make something new and better!
>> A laudable notion, but where is your system? And what are the
>> incentives for people who already use BTC transactions to also
>> adopt your system? You will need some significant advantages
>> to overcome the network effect, which will only get stronger
>> over time.
> 
> I don't say I have a system in place but I think a system where you get
> e.g. 1 FreedomCoin for letting somebody use 1 GB of your storage for 1
> hour of for letting somebody use your CPU for some amount of time would
> reward people for helping others to do useful work. And then you could
> use your FCs to use computing power when you need it or go to the bakery
> and buy some bread while the baker can pay his web-page hosting with
> those FCs.

There are a whole lot of issues to be addressed for a currency to be
widespread, meaningful and, of course, lawful

At the very root of the question is whether the currency is

a) a debt: redeemable against some person/institution for one or more
items (e.g. gold, USD or disk storage) at a fixed rate of exchange

b) independent of any issuer or guarantees about convertibility (as all
tangible commodity currencies are, and Bitcoin is also in this category)

In the case (a) it becomes more tricky from a legal perspective, because
there are many regulations to protect the public, there is the risk that
people don't get their 1GB of storage, or another flood in Thailand
wipes out HDD factories and storage prices go up and some `central bank'
of the freedomcoin currency has to change the `storage rates'.

In case (b), many of the legal and practical problems don't arise
because no central authority ever guaranteed that your currency unit
will buy storage at a specified price.  So it `floats' on the free
market and everybody will know from the outset that there is no promise
that they can change their BTC or whatever back to something else.

This comes back to the meaning of the word `currency'.  It is like an
electric current, it is meant to move.  If you hoard up your BTC or
whatever and they lose value or you get hacked, that is very sad, but
nobody can guarantee it won't happen.  But if you keep your BTC moving
(e.g. you sell your bike for BTC and then you use all of the currency
immediately to buy something of similar value) then the long term
changes in value don't impact you.