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E-Gold Founder Launches New Gold Backed Currency

Tyler Durden's picture




 

Submitted by Mike Krieger of Liberty Blitzkrieg blog,

It was only a matter of time before the success of Bitcoin led to a new attempt to create a digital currency backed by gold. It seems as if that day has now arrived.

Douglas Jackson is the founder of e-gold, which was shut down by U.S. authorities a little over five years ago under accusations of money laundering. While I fully think the ultimate monetary solution will be a decentralized payment protocol that merges Bitcoin-like technology with the ability to back it with gold, silver or whatever people want, I am of the view that it cannot be done from an overly centralized authority or protocol. There are several reasons for this.

First, when you have a centralized single issuer of a currency who also is responsible for vaulting the gold within the payment system you have an enormous degree of counter-party risk. The vault itself could be seized by “authorities” in whatever jurisdiction it is located in.

 

Second, the human beings or company behind any currency system can themselves be pressured or threatened in order to comply with more powerful interests. The beauty of Bitcoin is that there is no “Bitcoin corporation.” It truly is decentralized and anarchic in nature. It basically puts “the powers that be” in a position that if they want to completey destroy it, they’d have to destroy the internet itself.

That said, I do believe the evolution of money is headed to a Bitcoin type system with the ability to have whatever backing is desired by the market. So at this point my questions to Mr. Jackson would be:

1) How decentralized is this currency system intended to be if at all?
2) Will there be an open source protocol available to all?
3) Are the units of currency distributed to those that own gold in a particular vault or vaults under a the custodianship of a particular company?
4) Is the currency limited to those who own gold in the currency issuer vaults, or will they be linking vaults all over the world if such vaults care to be linked.

While I love the idea, it would have to be done right or it will be doomed to fail. I’m very curious to learn more about this and I’d also love to hear reader feedback on this.

From the Financial Times:

The founder of one of the earliest virtual currencies has re-emerged with a rival to Bitcoin, more than five years after his first venture, e-gold, was shut down by the US Department of Justice

 

Douglas Jackson is consulting for a membership organisation called Coeptis that hopes to launch a new version of his gold-backed currency, which attracted millions of users at its height.

 

Coeptis’s “global standard currency” would be fully backed by reserves of gold, held in a trust, in effect turning the precious metal into a medium of exchange.

Full article here.

***

Update from Mike Krieger:  *Since the publication of this article, I have been contracted by Douglas Jackson and he has informed me that he is not personally launching anything and that he is merely a consultant on this new project. I hope to have more details on all of this in the near future.

 

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Fri, 11/29/2013 - 22:19 | 4201022 Seahorse
Seahorse's picture

Bring it.

 

Fri, 11/29/2013 - 22:24 | 4201032 SafelyGraze
SafelyGraze's picture

why china people tv crushing america people tv:

xi?o mòlì. Shàoshào SEXY xìngg?n y?nch?-d?nyuán: Qíshí nánrén “sh?nt?” b? zu?ba chéngshí! Wàng dàji? chún x?nsh?ng jiémù xiàogu?! Bié tài yánsù kàndài

http://www.youtube.com/watch?v=0lri_APUNrY

 

Fri, 11/29/2013 - 22:31 | 4201045 philipat
philipat's picture

This will work but it will be called the Chinese Yuan.

The problem with linking vaults who wish to join is that few if any of those vaults actually hold any Gold and if they do it has been leased/hypothecated/rehypothecated etc. It also puts it into a situation where the Bullion Banks can play games with it, just like the paper markets now.

Fri, 11/29/2013 - 22:33 | 4201056 ACP
ACP's picture

Just don't call it a currency. Make it into virtual shares that can be converted into currency.

Pink sheets are the closest thing to non-regulated...pink-sheet-gold-bit-shares?

Fri, 11/29/2013 - 23:32 | 4201085 AlaricBalth
AlaricBalth's picture

This is not the gold backed crypto currency you are looking for. Dr. (An oncologist) Douglas Jackson (Double D to his friends) has allegedly left quite a few investors holding the proverbial bag. A little due diligence would have been warranted before FT published this article. Coeptis is a registered trademark of Fulcrum IP Corp, owned by Douglas Jackson. FT reported he is consulting to Coeptis. Lots of hype and not a lot of substance. This guy must have one helluva publicist.

FYI

This is a brand page for the COEPTIS trademark by FULCRUM IP CORPORATION in SATELLITE BEACH, FL, 32937. Write a review about a product or service associated with this COEPTIS trademark. Or, contact the owner FULCRUM IP CORPORATION of the COEPTIS trademark by filing a request to communicate with the Legal Correspondent for licensing, use, and/or questions related to the COEPTIS trademark.
Status Update! On Monday, November 18, 2013, status on the COEPTIS trademark changed to FIFTH EXTENSION - GRANTED.

On Thursday, September 30, 2010, a U.S. federal trademark registration was filed for COEPTIS by FULCRUM IP CORPORATION, SATELLITE BEACH, FL 32937. The USPTO has given the COEPTIS trademark serial number of 85142464. The current federal status of this trademark filing is FIFTH EXTENSION - GRANTED. The correspondent listed for COEPTIS is Therese Finan of PATTON BOGGS LLP, 2550 M Street, NW, Washington DC 20037 . The COEPTIS trademark is filed in the category of Insurance & Financial Services . The description provided to the USPTO for COEPTIS is Financial services, namely, administration of multi-currency accounts for use in holding privately issued currencies and using them as money.

http://www.trademarkia.com/coeptis-85142464.html

Foreign Profit Corporation
FULCRUM IP CORPORATION
Filing Information
Document Number
F11000001845
FEI/EIN Number
450699376
Date Filed
04/28/2011
State
DE
Status
ACTIVE
Principal Address
175 E NASA BLVD SUITE 302
MELBOURNE, FL 32901

Changed: 02/01/2012
Mailing Address
PO BOX 372425
SATELLITE BEACH, FL 32937

Changed: 02/01/2012
Registered Agent Name & Address
JACKSON, DOUGLAS
175 E NASA BLVD SUITE 302
MELBOURNE, FL 32901

Address Changed: 02/01/2012
Officer/Director Detail
Name & Address

Title DIR

JACKSON, DOUGLAS
175 E NASA BLVD SUITE 302
MELBOURNE, FL 32901

http://search.sunbiz.org/Inquiry/CorporationSearch/SearchResultDetail/En...

Towards an alternative global currency
TOPIC: Future of Money
By: Douglas Jackson
January 18, 2012
http://www.compasscayman.com/cfr/2012/01/11/Towards-an-alternative-globa...

FRIDAY, SEPTEMBER 20, 2013

Are Taxpayers About To Fund An e-Gold Comeback?
The principal director of E-Gold and CEO of Gold & Silver Reserve Inc., Dr. Douglas L. Jackson, of Melbourne, pleaded guilty to conspiracy to engage in money laundering and operating an unlicensed money transmitting business. E-Gold’s other two senior directors, Barry K. Downey, of Baltimore, and Reid A. Jackson, of Melbourne, each pleaded guilty to felony violations of District of Columbia law relating to operating a money transmitting business without a license. E-Gold, Gold & Silver Reserve and the three company directors were charged in an indictment returned by a federal grand jury in 2007.

As of today thousands of e-gold account holders and investors have not recovered their funds as the result of e-gold being shut down by the federal goverment in 2007.

http://government.brevardtimes.com/2013/09/are-taxpayers-about-to-fund-e...

Fri, 11/29/2013 - 23:33 | 4201175 CH1
CH1's picture

Douglas Jackson (Double D to his friends) has left quite a few investors holding the proverbial bag.

So... it was his fault that the Feds stole all the gold?

Fri, 11/29/2013 - 23:39 | 4201187 clymer
clymer's picture

took the words from my mouth ch

Sat, 11/30/2013 - 00:26 | 4201262 Anusocracy
Anusocracy's picture

Why not back a currency with the most precious of commodities.

An honest politician.

Sat, 11/30/2013 - 00:28 | 4201269 dick cheneys ghost
dick cheneys ghost's picture

why not back it with Lauren Lysters legs??

Sat, 11/30/2013 - 00:43 | 4201294 fonestar
fonestar's picture

I will gladly take my unbacked Bitcoin over E-Gold.

Sat, 11/30/2013 - 01:21 | 4201341 Occident Mortal
Occident Mortal's picture

Whereas others will not.

Sat, 11/30/2013 - 01:41 | 4201366 fuu
fuu's picture

What's the over-under on the BTC/Gold deathcross?

Sat, 11/30/2013 - 01:52 | 4201386 markmotive
markmotive's picture

Bitcoin's future is still undecided.

Peter Schiff vs. Stefan Molyneaux: Bitcoin vs. Gold: The Future of Money

http://www.planbeconomics.com/2013/11/bitcoin-vs-gold-future-of-money-pe...

Sat, 11/30/2013 - 02:03 | 4201401 LetThemEatRand
LetThemEatRand's picture

Who here will go to prison for using Bitcoin when they make it illegal?  Hands?   Yes, I understand that like drugs there could be an underground.   But more valuable than a unique metal that Kings and Queens fought over since there were Kings and Queens?    Today, you can still collect gold from ships that sank hundreds of years ago from the bottom of the ocean and get rich doing it.  

Sat, 11/30/2013 - 02:59 | 4201463 boogerbently
boogerbently's picture

Bitcoin is crap.

They're selling an IDEA.

But then, I thought FB would fail because there was no product and AAPL was only a fad because it was "popular".

Perception IS reality.

Sat, 11/30/2013 - 03:13 | 4201472 Squid-puppets a...
Squid-puppets a-go-go's picture

To idiots like Fonestar, the very fact that anyone is putting out a digital currency backed by gold shows, when all is said and done, that gold is the real deal. Dig currency may add a certain utility but the real store of wealth is in Au.

Otherwise, this post woukld be about someone launching a product of 'physical gold backed by Bitcoin'

appreciate this: increased demand for phys gold can cause the reset and foster the reemergence of a free and fair market. bitcoin is a free market, but an increase in bitcoin value represents nothing but excess liquidity finding another bubble. you cant kill the beast with bitcoin alone

Sat, 11/30/2013 - 04:19 | 4201529 PP
PP's picture

I fully suggest this shit guy launch new currencies not backed by gold, but backed by Memecoin (similar to Bitcoin). Meme in Chinese means breast.

more fashion than gold.

Sat, 11/30/2013 - 06:58 | 4201601 negative rates
negative rates's picture

Sure, I love to visit your vault, just give us address and the hours you are open and we will be good to go. But until that day, keep dreaming you are not another failed currency.

Sat, 11/30/2013 - 08:44 | 4201626 smlbizman
smlbizman's picture

a phsyical gold bitcoin.....by the royal mint in alderney

http://www.ft.com/cms/s/0/4903fc9a-591f-11e3-a7cb-00144feabdc0.html#axzz...

ft wont open from this link....this story is on drudge now...sorry..

Sat, 11/30/2013 - 11:03 | 4201757 funthea
funthea's picture

http://www.ft.com/intl/cms/s/2/6d51117e-5806-11e3-a2ed-00144feabdc0.html...

Appears Mr. Jackson has been engaged in restitution.

Sat, 11/30/2013 - 15:08 | 4202140 fonestar
fonestar's picture

In case some of you dummies are having trouble figuring this out "backing" is centralization!

It is more important that a currency is decentralized (as well as not run by human beings) than any "backing" could ever possibly be!

Sat, 11/30/2013 - 09:32 | 4201678 savagegoose
savagegoose's picture

but boobs lose value faster than fiat!

Sat, 11/30/2013 - 03:15 | 4201488 Kirk2NCC1701
Kirk2NCC1701's picture

IF they make it illegal, it'll be the US shooting itself in the foot. The rest of the world will keep using it, as will (rich) Americans with offshore assets.

Joe Sixpack will get screwed. Again.

Sat, 11/30/2013 - 03:53 | 4201499 LetThemEatRand
LetThemEatRand's picture

By "they", I meant Central Banks.  America is a pawn to them.  Remind me who is in charge of the European Central Bank.  His former company rhymes with Gold Man.

Sat, 11/30/2013 - 15:23 | 4202183 fonestar
fonestar's picture

It's ironic that this scheme (as well as Peter Schiff's gold-backed credit cards) are still going to piggy-back on the same corrupt banking system that you purport to hate.

So you could use a payment system that does not intersect with TPTB banks (like Bitcoin or Litecoin), but no you are fakes, phonies and shills for the establishment.  You love giving the banks micro-payments on every transaction so they can go ahead and naked short PMs.  The "metals only" crew, extra thick morons and proud of it!!

Sat, 11/30/2013 - 03:43 | 4201520 acetinker
acetinker's picture

Two words, fone: Carrington Event.  Yeah, that would make almost everything worthless, instantly.  But it would likely make bitcoin unrecoverable, ever.  EVER.

 

 

Sat, 11/30/2013 - 15:10 | 4202144 fonestar
fonestar's picture

....yeah just keep waiting a few thousand years.  I will get rich and die in the meantime.

Sat, 11/30/2013 - 23:24 | 4202930 acetinker
acetinker's picture

You're an adversarial fucker, aren't you?  Actually, we're just about due for another solar max.  Trust me, it's gonna suck for everyone, and you won't be rich.  Karma's a bitch.

Sat, 11/30/2013 - 07:35 | 4201617 Svendblaaskaeg
Svendblaaskaeg's picture

"I will gladly take my unbacked Bitcoin over E-Gold"

I read it as:"I will gladly talk my book against E-Gold"

..but that's just silly Me..

Sat, 11/30/2013 - 15:11 | 4202147 fonestar
fonestar's picture

E-Gold is stupid and nobody is going to buy it.  I will wager anyone on here on that matter.

Sun, 12/01/2013 - 12:29 | 4203512 Best Satan in Town
Best Satan in Town's picture

Be quiet. Your whole schtick is a government sponsored enterprise.

Sat, 11/30/2013 - 00:50 | 4201307 knukles
knukles's picture

So, a digital currency of questionable security backed by precious metals stored somewhwere via the City of London, subject to infiniote rehyopthecation under LBMA standards including warehouse reciepts that'll be unaudited in accordance with nobody's acceptable accounting standards.

Precisely!

Sat, 11/30/2013 - 01:47 | 4201380 StillSilence
StillSilence's picture

How about free market competition for ANY good/commodity storage institution that can pass notes and digital transfer units based on fully redeemable goods. Naturally PM becomes the simplest thing to warehouse and transfer (worldwide) etc so honest banking is essentially created. Public televsion and internet broadcast footage from these instiutions and any attempt at theft is immediate death penalty....ok perhaps slightly dramatic on the last point, but certainly a perpetator should be heavily disuaded and given no means to accomplish this.

There doesn't need to be a central force behind an egold or similar, it would need exactly the contrary to serve its true purpose. People would not stand for any institution that was not secure.

Sat, 11/30/2013 - 02:00 | 4201399 Handful of Dust
Handful of Dust's picture

"If you don't hold it, you don't own it."

Sat, 11/30/2013 - 02:15 | 4201415 Buckaroo Banzai
Buckaroo Banzai's picture

It's called "Free Banking", and it existed in Scotland for a few hundred years, until the English identified it as a threat and crushed it.

It's a system that works, but it isn't clear how well it would suit an electronic economy, like the one we have today. BitCoin is an outstanding choice for Internet transactions.

Gold and silver coins, free banking, and Internet crypto currencies: these are not mutually exclusive ideas! They can all work side by side!

It is sad that I have to explain this. It just goes to show how completely foreign the idea of a truly free financial marketplace is in this day and age. 100 years of financial tyranny has mentally disabled the population so badly that even in a forum like ZeroHedge, the idea that multiple systems of currency and finance can freely coexist, with each serving its own purpose, seems barely comprehensible.

Sat, 11/30/2013 - 02:53 | 4201456 StillSilence
StillSilence's picture

I could be mistaken, but I would imagine that the need for a crypto currency would soon diminish if people were allowed to freely transact without the "govt/bank" interference. Obviously people and commerce exist with or without internet (or any other) technology, not the other way around. This means money is and will be rooted in our physical world because at the end of the day people have to transact with it in the physical world. Its origination is supposed to be based on real world goods and services and the demand for them.

If free banking truly existed, and say PM could be transferred instantly between any institutions opertating under it, always fully redeemable of course, then that would be the ideal..i think.

Crypto currency appeal exists because we are under such a corrupt and controlling "money" system. Assume the dollar is the newly made reserve currency of the world and fully redeemable by any and everyone. Then bring the internet in to allow for electronic exchange, rather than mailing a check or notes (which would be redeemable) and where would the need be for a crypto currency based on math?

Sat, 11/30/2013 - 11:34 | 4201795 Zadok
Zadok's picture

Buckaroo and Still,

I appreciate a little intelligent commentary as opposed to the worn out reactionary stuff that normally occurs.  Simultaneous currencies disconnected from the fiction created by fraud and enforced by the IRS/IMF/Military et al.

Simultaneous honest currencies with freedom to choose the most optimum method of use, coupled with prosecution of dishonesty and fraud, why that sounds like real capitolism.  

Competing currencies, sounds like a beginning...

Sure sounds good to me!  

Sat, 11/30/2013 - 15:35 | 4202200 tsx500
tsx500's picture

fonestar , where are you ?

Sat, 11/30/2013 - 10:48 | 4201739 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

If you create a digital currency based on bitcoin as long as it has an open public ledger you can't pull the etf leverage game to suppress price. Problem is if you try to go after the Crimex in this manner they will go after the exchanges/vaults to shut it down. It might work as a currency but as an exchange without cutting the Crimex in those are the choke points and they will squeeze. With that said Gresham's Law btichez and that is why E-gold will not be more than a speculative vehicle at best/medium of digital exchange between gold vaults and dealers because it requires trust that can't be easily verified in the digital world where E-gold resides.

Sat, 11/30/2013 - 03:58 | 4201522 Shrapnel
Shrapnel's picture

Yes please!! I miss Capital Account!

Sat, 11/30/2013 - 07:52 | 4201624 unrulian
unrulian's picture

An honest politician?

You must mean a unicorn

Sat, 11/30/2013 - 00:47 | 4201304 Duke of Earl
Duke of Earl's picture

The most precious commodity is an oxymoron?

Sat, 11/30/2013 - 00:18 | 4201199 AlaricBalth
AlaricBalth's picture

E-gold Bullion storage As of November 2005, it is unclear if e-gold has an independent auditor of the physical bars, so there is no way of knowing if e-gold Ltd. really has the reserves to back the currency in the e-gold system. e-gold does maintain an "Examiner", a web page with updated statistics on outstanding liabilities and the total amount of each precious metal in its holding. While proponents generally consider this assuring enough, some critics remain skeptical.

http://www.worldlawdirect.com/article/1951/e-gold-hyip-scams.html

Please provide a link to back up your allegations. Nothing would please me more than to have a gold backed crypto currency.

In my humble opinion, the good doctor is probably not the promoter I would be betting on. The cold reality of the situation is investors, whether institutional or accredited individuals, are extremely hesitant to place capital with anyone who has a felony conviction. The dubious circumstances behind the conviction are irrelevant. Dr. Jackson stating that he is consulting to Coepsis, when he is clearly the owner, is a red flag. He may have been sanctioned or banned by a regulatory agency and is barred from direct executive management within the financial services and ancillary industries. By declaring he is a consultant is the usual way one would attempt to get around said sanction.

Sat, 11/30/2013 - 00:32 | 4201275 disabledvet
disabledvet's picture

if it doesn't pay interest it's not money. PERIOD.

Sat, 11/30/2013 - 07:58 | 4201630 Quinvarius
Quinvarius's picture

Dude, the dollar doesn't pay interest.  Loaning gold pays you interest.  Loaning dollars pays you interest.  No money pays you interest just by holding it. 

Sat, 11/30/2013 - 09:41 | 4201685 Agstacker
Agstacker's picture

So I look at a $20 dollar bill that's been in my wallet for awhile and it has given me no interest.  Is it no longer money?  

Sat, 11/30/2013 - 10:58 | 4201750 Jreb
Jreb's picture

It's even worse than that. My $20 bill is worth less this year at the grocery store than it was last year. You might say it is "disinterested" in maintaining its purchasing power. 

Sun, 12/01/2013 - 10:46 | 4203345 ejmoosa
ejmoosa's picture

I think you must have included negative interest to make that statement.

 

Sat, 11/30/2013 - 04:21 | 4201531 Oracle of Kypseli
Oracle of Kypseli's picture

<<<<<< Nothing would please me more than to have a gold backed crypto currency. >>>>>

You can always become a coin dealer (even a part time one) do not have to report small transactions.

 

Sat, 11/30/2013 - 09:28 | 4201675 TeMpTeK
TeMpTeK's picture

Right now bitcoin is the cool kid...  but wait till the politicing class regulates the shit out of it.. Whats that you say? you cant do that?  its anonymous, peer to peer? you would have to shut down the whole internet to stop it?... Bullshit!.. the achilles heel of bitcoin is "Convertability".. noone will accept bitcoin if they knew there was no way to convert it back to some form of cash... This is where your evil govt gladly steps in because at the end of the day this thing needs a bank somewhere in some jurisdiction to complete the ultimate transaction... Give me my money!... When TPTB makes it so that every xxxCoin transaction to cash must be verified with names, addresses, SS #s, and wait for it.... Anti-terrorism/laundering/tax witholding redemption wait times".... There goes fonestars hard-on... Regulation is coming,, Why? because this shit has not been authorized.. now how and where can i buy BTC puts?

Sun, 12/01/2013 - 00:46 | 4201784 TheHound73
TheHound73's picture

Aye, but an interesting thing, and what I hear so many scream about, is that Bitcoins don't really exist.  They are intangible, just data.  Gov't will look foolish when it comes in with a heavy fist outlawing purchase of numbers ABC representing a bitcoin on the one hand but allowing purchase of numbers XYZ representing an MP3 file on the other.  If numbers are outlawed, only outlaws will have numbers. Bitcoins can be encrypted up and hidden to look like other digital media.  And like marijuana, they can't stop person-to-person cash-to-btc transactions.  Bitcoin's "killer app" is subverting government controls.

On the other hand, kiddie porn is also just data in this day and age, hmmm.  

 

Sun, 12/01/2013 - 09:01 | 4203256 TeMpTeK
TeMpTeK's picture

"they can't stop person-to-person cash-to-btc transactions"

Oh please.. BTC are going to be "backalleycoins".. if thats the game plan.. cash out now..oh but where and for how long??. http://benswann.com/bitcoin-is-soaring-but-beware-mt-gox/

Mon, 12/02/2013 - 02:54 | 4205798 TheHound73
TheHound73's picture

A suprising amount of BTC trade is done off the exchanges.  Anonymously person-to-person cash-for-BTC. 

Localbitcoins.com

 

Sat, 11/30/2013 - 12:48 | 4201883 mccoyspace
mccoyspace's picture

While not exactly the same as buying puts, you can short Bitcoin and Litecoin at bitfinex.com by borrowing them from other users to sell, then buying back (hopefully at a lower price) later to settle.

I'd love to hear how it goes for some skeptics here to set up an account, wire over some money and go short.

Sat, 11/30/2013 - 03:13 | 4201486 BlackVoid
BlackVoid's picture

YES. He was stupid enough to base his business in the USA.

Fri, 11/29/2013 - 23:36 | 4201179 clymer
clymer's picture

as I said (here: http://www.zerohedge.com/news/2013-05-12/visualizing-how-bitcoin-transac... ),

"Look ZH, I love how BC uses 256bit PKI with salted hash to regulate and restrict the number of coins mined. I love how buyers and sellers can agree on it as a medium of exchange to work together without 3rd party interference. I get it. But here's the thing that prevents me from biting: it ain't backed by anything. And what the fuck is Keiser talking about when he says there will never be a competitor to bitcoin? Here's a novel idea: Anonymous puts a little time into understanding as much about banking and finance as they understand about scientology. As this understanding spreads between their more entrepreneurial members, say an offshoot, sub group that happens to work in certificate / key store management, they develop a similar algorithm, only they say, "look, we developed a similar model called 'crypto coin' won't just allow this to denominate in fiat that the 'cryptocoin' marketplace will back, we will tie specifically to gold and silver. The algo will ultimately mine 15x more silver colored cryptocoins than th gold colored ones, to represent what exists naturally in the crust of the earth. They then correspondingly create their own exchange (even say a virtual exchange represented by members), collectively owned by all cryptocoin holders. The balance of actual metal in the exchange is verified on a quarterly basis by the top 100 cryptocoin holders to verify that they maintain the same amount of precious metals in the exchange, as there exists cryptocoins in circulation. The crypto coins can then be redeemed in gold and / or silver. The same concept could be applied to oil contracts, shares in organic beef farms, or stock at company xyz. Till I see the next evolution cryptographic digital currency, I will keep hitting the coin shop and stacking. 

Intrinsic value is one thing. Tangible value is another. Combining the two is key

Observation: The bitcoin buyers / holders appear to be vitriolic toward those that prefer PM's. Understand that we are on the same side of this argument. Don't lose sight of the bigger picture; that we all now recognize how the monopolized private issuance of currency and credit has led us to this point"

Now im in. So long bitcoin

 

Sat, 11/30/2013 - 01:59 | 4201393 Advoc8tr
Advoc8tr's picture

Love your idea ... why not make it a zero hedge initiative ? If we can get everyone on side. I see the vitriol coming from the metal holders not the crypto currency advocates ... must be reading different posts.

Anyway I personally jumped straight into Bitcoin as a currency and already had all my money as bullion ... can't understand the rejection of it by fellow gold bugs ?

So how do you get the phys in place ?  Issue new coins only to those that logde the metal directly with an accredited vault ?  I would go further and set the vaults up with 24hr streaming video and have the custodian enter once a day to place a variety of newspapers about or something .... still succeptible to the gov siezing it though ?  Perhaps individuals could store the bullion around the globe using the method described above with quarterly audits by local coin holders ?  If you get the phys widely distributed you would be a lot safer from a macro perspective.

 

Sat, 11/30/2013 - 03:10 | 4201480 Squid-puppets a...
Squid-puppets a-go-go's picture

not quite. bitcoin and gold are allies in a sense, but in the context that we were close to cracking the Comex before a number of people got giddy and switched to bitcoin instead, the interest in the dig currency has led to a delay in the stake being driven through the vampires heart

Sat, 11/30/2013 - 11:07 | 4201760 Jreb
Jreb's picture

Your vaults would have to be owned and maintained by a heavily armed and well funded private army in order to discourage government/banking cartel raids. This means they would have to be set up in countries with poorly financed and weak military/police structures but still with some structure and adherence to the rule of law. This rules out places like the USSA, Russia, China, UK etc etc. Otherwise you are toast before you get rolling.

 

Sat, 11/30/2013 - 12:53 | 4201892 mccoyspace
mccoyspace's picture

At this point, the easiest way to set up a system like this is with Ripple. That system makes it very easy to create the virtual tokens, trade them an account for them. THe problem with ripple is that is essentially centralized and proprietary. The codebase is open source, however, so developers could make a clean room copy that doesn't include the pre-mined xrp coins that run the current version.

Sat, 11/30/2013 - 15:06 | 4202136 chaartist
chaartist's picture
GOLDBUG VIEW ON BITCOIN BITSWAN. Thanks for feedback. Hard to get head around those cryptocurrencies in these crazy times. http://www.offgridminds.com/misinformation-blog/2013/11/30/goldbug-view-...
Sat, 11/30/2013 - 12:13 | 4201835 Drifter
Drifter's picture

"Just don't call it a currency. Make it into virtual shares that can be converted into currency."

Then it's just another gold ETF with Bitcoin-like shares outside "official" exchanges.

You're right, don't call it a currency, because it isn't, just like Bitcoin isn't a currency. 

You might say Bitcoin is a virtual commodity some people are willing to barter with.  But it's not a currency.

If China decides to back Yuan with gold, it would be a gold backed currency.

Fri, 11/29/2013 - 22:35 | 4201066 F-Tipp
F-Tipp's picture

That first sentence gave me a good laugh philipat. It is an eventuality, anyway.

Fri, 11/29/2013 - 22:53 | 4201103 ZH Snob
ZH Snob's picture

they need to bring it to the Singapore Precious Metals Exchange and partner up with them.  as far as counter party risk goes, an independent auditing can be done by the choice of the e-gold holders, and we all now that place is far more metal friendly than the supposedly land of the free. 

the SPME can provide the vaulting and the physical exchange, and it would be the solution to put PHYSICAL metals in the forefront of world MONEY.

Fri, 11/29/2013 - 23:07 | 4201135 seek
seek's picture

Only way it could possibly work with vaulting is a truly insane level of auditing and accountability standards. I could see some sort of public filing of the organization legally closing off the ability to lease/rehypothecate (structure things so the coinholders are always in first position, among other things.) Perhaps some sort of publicly viewable real-time automated audit of serialized deposits. I think one of the smaller gold trading platforms had something similar set up (public ledger that was audited.)

Fri, 11/29/2013 - 23:31 | 4201173 Spigot
Spigot's picture

Absolutely agree w/ you on the absolute 'extreme' auditing. However, it is a well worn tradition to pretend to house gold in exchange for receipts and then to either abscond, default, etc with the gold, leaving a shell. In fact this was the basis for modern western currencies, and if you know their history you will agree that in spite of all the assurances there is no there, there.

Sat, 11/30/2013 - 01:53 | 4201387 Wahooo
Wahooo's picture

I trust the Chinese to maintain a gold backed currency. I do not trust the NY bankster tribe to do the same. America is compromised.

Sat, 11/30/2013 - 01:59 | 4201396 Bananamerican
Bananamerican's picture

A SinAU currency=a dim sum

Sat, 11/30/2013 - 07:58 | 4201629 unrulian
unrulian's picture

why in gods name would you trust eithor?

Sat, 11/30/2013 - 10:45 | 4201735 A82EBA
A82EBA's picture

you mean for short-term trading, not long-term storage

Sat, 11/30/2013 - 01:57 | 4201391 Popo
Popo's picture

"This will work but it will be called the Chinese Yuan."

 

Honestly, stop spouting out the absolutely stupid shit that gold-bloggers spew.  The last government on Earth that would want a non-fiat currency is the Chinese.  They are the undisputed world-champions of money printing, and they make the Federal Reserve look like a junior-varsity monetary authority.

 

The very idea that the world's largest export nation would for some asstard reason want a strong currency is the kind of idiocy that career losers like Jim Rickards spit out day after day without ever bothering to explain why a nation with a massive wealth disparity, dangerous social instability, massive export infrastructure, dangerously overleveraged banks and a massive centrally-planned economy would suddenly want to exercise fiscal responsibility and end the game that keeps the Communist Party in power and the peasants from rising up and killing them.

 

No, the Yuan will never be backed by gold.

 

BUT China will be buying the world's oil and mineral resources directly with gold. And that will break the back of the petrodollar standard.

 


 


Sat, 11/30/2013 - 03:38 | 4201517 Squid-puppets a...
Squid-puppets a-go-go's picture

I think you might be discounting the prospect that china, seeking to flip from export to internal consumption based economy, can speed up, smooth out and lessen the pain of such a transition if it has a sudden large appreciation of its currency vis-a-vi the $US. And a gold backed yuan is the simplest and most credible method of acheiving that

Sat, 11/30/2013 - 09:09 | 4201664 SWRichmond
SWRichmond's picture

Agree.  I think that internalizing markets, building a financially strong middle class, and internationalizing and strengthening the yuan all work together.

Want a strong military?  You need a strong currency.

Sat, 11/30/2013 - 10:21 | 4201715 Popo
Popo's picture

Why? Because America's internal consumption went down when we went off the gold standard? If you're trying to goose internal consumption, you want a fiat system.

China will never, ever use a non-fiat currency. Ever.

Sat, 11/30/2013 - 11:41 | 4201808 Zadok
Zadok's picture

There is the possibility of a split currency so to speak.  

PM backed for international trade and for the 'elite' (whatever boundaries that turns out to be) and debt based fiat with the associated pump and dump/boom and bust/cycles we have all come to know and hate.  

That could accomplish the 'best' of both worlds.  

Sat, 11/30/2013 - 13:30 | 4201918 Winston Churchill
Winston Churchill's picture

Worked fine for the US between 1933-1971.I'm sure the Chinese noticed.

Sat, 11/30/2013 - 13:56 | 4201977 chemystical
chemystical's picture

That's an overlysimplistic explanation. 

If I chose to offer a single explanation to why the usa's internal consumption plummeted then I would be far more accurate to say that it began when "I" started paying the neighbor's kid to mow "my" lawn solely because he underbid my own kid.  Nevermind that Ii still had to pay my kids' expenses while defraying my neighbor's need to pay his kid's expenses.

The USA thrived for ~ 140 yrs while duties and tarriffs remained high.  After they were removed Pandora's "door" was opened wide.  Do economic fences discourage productivity and innovation?  To an extent, yes, but I'd rather the Ohioan compete against the Californian than have both compete against the Chinese and the Japanese etc.  Nixon and Kissinger were both dead wrong (at least from the perspective of 99% of US citizens today)

Fri, 11/29/2013 - 23:39 | 4201182 wee-weed up
wee-weed up's picture

The beauty of Bitcoin is that there is no “Bitcoin corporation.” It truly is decentralized and anarchic in nature. It basically puts “the powers that be” in a position that if they want to completey destroy it, they’d have to destroy the internet itself.

----------------

Uh, no.

All they (gov't) have to do is make life unbearable for each individual Bitcoin internet user...

And NSA, DHS, FBI, IRS and others are all perfectly capable of doing that...

And they will.

Sat, 11/30/2013 - 00:12 | 4201235 Aknownymouse
Aknownymouse's picture

You are correct. The value of any currency is in its acceptance. If no one wants to accept it as form of payment it is worthless. Thats where the gov comes in.

Sat, 11/30/2013 - 00:21 | 4201254 dracos_ghost
dracos_ghost's picture

Another take,

It basically puts “the powers that be” in a position that if they want to completey destroy it, they’d have to destroy the internet itself

Or allow it to saturate and then accept it - under certains terms of course. Why destroy it when they can turn it into a productive bitch.

Anyone else a little suspicious of the FAQs of the main exchanges starting to sound like Basel III/AML experts with all the buzzwords. With bitcoin we don't need no stinking IMF SDR.

Sat, 11/30/2013 - 11:14 | 4201768 Keyser
Keyser's picture

That is if you are in the jurisdiction or subject to the actions of the alphabet soup agencies. 

Bitcoin must scare the shit out of TPTB because it is currently outside their realm of control.

Fri, 11/29/2013 - 23:49 | 4201193 conork
conork's picture

Hasn't Peter Schiff set up a bank that allows customers to deposit funds, which are then converted to gold. You are then given a credit/debit card, and as you spend it withdraws from your gold account.

 

 

Sat, 11/30/2013 - 01:11 | 4201334 Spitzer
Spitzer's picture

Yes he has.

 

It shows how bitcoin is kinda useless. Because with Schiff's bank cards, it eliminates the inflation worry because you only hold the curreny units for a few seconds as you make a transaction. But you are saving meduim and long term in gold.

Its Freegold. fofoa

Sat, 11/30/2013 - 02:19 | 4201419 Buckaroo Banzai
Buckaroo Banzai's picture

Why not cut out the middleman (i.e. the bank) entirely? It's just going to add costs.

That's what's great about BitCoin: cuts the banks entirely out of the picture.

Sat, 11/30/2013 - 11:18 | 4201777 Keyser
Keyser's picture

The banking Cabal must be given their cut or else the tanks will roll. Oops, no bitcoin corp, so no one to disappear. 

 

Sat, 11/30/2013 - 03:13 | 4201484 Alpha Monkey
Alpha Monkey's picture

Yes, but I don't believe it's available to US residents due to AML restrictions.

Sat, 11/30/2013 - 04:25 | 4201532 Kirk2NCC1701
Kirk2NCC1701's picture

Correct. But it's a flawed biz model...
Why pay for Au margins, when you can use fiat for a credit card.
Bad for customers, great for Pete and Au bullion guys and nice margins.

In principle Au and btc are compatible. The fact that he objects so ardently, is a "tell": it's impacting his biz severely.

Every Libertarian loves the Free Market, until it messes with THEIR business or wealth.

Sat, 11/30/2013 - 07:48 | 4201621 Herodotus
Herodotus's picture

Yes, but he does not allow Americans to set up an account.

Sat, 11/30/2013 - 00:46 | 4201302 Atomizer
Atomizer's picture

Fuck you Federal Reserve!

We Were Promised Jetpacks - Sore Thumb

Sat, 11/30/2013 - 01:01 | 4201322 markettime
markettime's picture

SOB!!!! I need to invest in this shyt!!!!!

Sat, 11/30/2013 - 06:46 | 4201595 lickspitler
lickspitler's picture

More like E-Tulip. Bitchez.

 

Sat, 11/30/2013 - 06:51 | 4201596 lickspitler
lickspitler's picture

The FED will shut this shit down it goes to zero.

Sat, 11/30/2013 - 11:25 | 4201788 Keyser
Keyser's picture

It will be interesting to watch them scramble to try and shut this down, but they will fail. All part of the loss of confidence in the American empire. 

 

Sat, 11/30/2013 - 12:30 | 4201860 ZH Snob
ZH Snob's picture

if the NSA has the ablility to monitor every email, every phone call anywhere in the world what makes you think that bitcoin is beyond their reach?

at this moment they are working feverishly towards quantum computing.  in short, it works on a level of reality the man-on-the-street has no idea even exists.  once developed, these things will unlock the cryptology of bitcoin in an afternoon and still have plenty of processing power left to work on all the https:// while beating every existing grandmaster in the world in a simultaneous game of chess.

Sat, 11/30/2013 - 11:02 | 4201756 rubiconsolutions
rubiconsolutions's picture

It may pay (no pun intended) to understand the nature of money before investing in any digital currency. Gary North has a great piece on the subject which should be read by everyone who is considering investing in crypto-currencies. Read it by clicking here. It is one of the better essays on Bitcoin I've read. Personally I'm suspicious of anything like Bitcoin or its kin regardless of whether it is backed (allegedly) by gold.

Sun, 12/01/2013 - 00:05 | 4203004 TheHound73
TheHound73's picture

In response to Gary North [blog]

First off, Gary North doesn't understand that Bitcoin is divisible.  This very basic understanding is needed in order to think one can pontificate on the technology with any credibility.

In other news, Gary North saved me from the Y2K apocalypse and taught me to stone homosexuals on sight.

Fri, 11/29/2013 - 22:20 | 4201023 in4mayshun
in4mayshun's picture

Finally an alternative currency I can get behind.

Fri, 11/29/2013 - 22:36 | 4201062 willwork4food
willwork4food's picture

I agree but who's going to hold it? What if they get raided?

Here's a new Silver debit Card you can get simply by shipping them your silver.

https://www.perpetualassets.com/silver-debit-card

Fri, 11/29/2013 - 23:12 | 4201110 gallistic
gallistic's picture

Spot on! That is the key queston- "What if they get raided?

Remember the Liberty Dollars?

From the U.S. Attorney’s Office March 18, 2011 Western District of North Carolina

“Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism,” U.S. Attorney Tompkins said in announcing the verdict. “While these forms of anti-government activities do not involve violence, they are every bit as insidious and represent a clear and present danger to the economic stability of this country,” she added. “We are determined to meet these threats through infiltration, disruption, and dismantling of organizations which seek to challenge the legitimacy of our democratic form of government.”

http://www.fbi.gov/charlotte/press-releases/2011/defendant-convicted-of-...

In 2006 prosecutors at the Justice Department determined that using Liberty Dollars as circulating money is a federal crime. They said that the "Liberty Dollars" are meant to compete with the circulating coinage (currency) of the United States and such competion is a criminal act.

http://www.usmint.gov/pressroom/index.cfm?flash=yes&action=press_release...

 

I completely agree that it has to be well thought out. The currency has to have a built-in mechanism to avoid the fate of Liberty Dollars and other forms of currency which were destroyed when they started to gain acceptance.

Fri, 11/29/2013 - 23:25 | 4201161 orez65
orez65's picture

"Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism,” 

According to this logic, the Federal Reserve is a domestic terrorist organization!

Fri, 11/29/2013 - 23:36 | 4201183 gallistic
gallistic's picture

Roger that!

Sat, 11/30/2013 - 00:50 | 4201310 Help Is Not Coming
Help Is Not Coming's picture

"In 2006 prosecutors at the Justice Department determined that using Liberty Dollars as circulating money is a federal crime. They said that the "Liberty Dollars" are meant to compete with the circulating coinage (currency) of the United States and such competion is a criminal act."

What really gets me is that the US Mint stamps $1 dollar on all of the silver eagles and $50 on the gold eagles. So if I exclusively used only gold and silver eagles in my life and got paid for my labors at say $3 an hour (3 oz. of silver but they are Silver Eagles so they are $3 because the US Gov't says so) then what would my taxable income actually be at the end of the year? Since I would probably "earn" less than $625 a month or whatever it is now to fall below the reportable/withholding threshold I probably wouldn't have to pay taxes at the end of the year. Granted I would never "convert" then to FRNs but I wouldn't want to do that anyway....

I wonder if the Federal Prosecuter would determine that using lawful money minted by the US Mint as circulating coinage would be a criminal act?

Sat, 11/30/2013 - 02:21 | 4201424 Buckaroo Banzai
Buckaroo Banzai's picture

Not an original idea. Somebody a few years ago tried to pay their employees this way. It wound up in court. Can't remember how it was resolved.

Sat, 11/30/2013 - 11:29 | 4201791 Keyser
Keyser's picture

In the mean time, many states / communities have enacted legal currency to be used in their jurisdictions. 

http://en.wikipedia.org/wiki/List_of_community_currencies_in_the_United_States

 

Sat, 11/30/2013 - 14:12 | 4202032 chemystical
chemystical's picture

If you used 25 of those gold eagles (that you and your employer claim are worth only $50 each) to buy a new car that the dealer says is worth $25,000, I get the feeling that The Taxman Cometh and will tell you something about capital gains.  Maybe you can try to "pass the buck" (tax burden-wise) to the dealer, and let him claim a $23,750 loss?  Then he's going to realize a gain when he exchanges those eagles.   Tax is going to be paid by someone.

Sat, 11/30/2013 - 04:53 | 4201545 Kirk2NCC1701
Kirk2NCC1701's picture

Well, if they intend to infiltrate and disrupt, then we got plenty of 'em right here... Talking BS and trash.

It also reminds me of the motto of the Moxxad: "By Deception and Subterfuge we shall wage war." Or something to that effect. Never realized that their guys were so influential with the Fed.

Fri, 11/29/2013 - 22:55 | 4201111 dark pools of soros
dark pools of soros's picture

shhh..  remember the stackers are religious, not logical.

 

this makes them FEEL good, which is all that matters....it would be totally corrupt just like the gold market now

 

 

Fri, 11/29/2013 - 23:44 | 4201191 Creepy Lurker
Creepy Lurker's picture

Totally corrupt is the only way it would be permitted to survive. If it is fully audited, fully transparent, and fully legitimate, TPTB will immediately go to war with it, as it will be a direct threat.

Sat, 11/30/2013 - 11:33 | 4201794 Keyser
Keyser's picture

That may be the perception, but I doubt there are many ZH members that have all their eggs in one basket. PM's are great for wealth preservation when the SHTF, but if you are an active investor you have to play the fiat game.

 

Fri, 11/29/2013 - 23:50 | 4201162 TheHound73
TheHound73's picture

So, attempting to bring back a gold standard for the internet using bitcoin-like security and ledger.  

If they run the ledger in-house, why would you trust it?  If they distribute the ledger, how will the crypto-miners get paid?

For the common person to use this they'll need drop off and redemption centers in every city with trained paid employees to assey it all?  Or run it all through the mail system?  Seems terribly expensive and with many paths for fraud and shutdowns.

Fees can be only marginally more expensive than credit cards or customers and merchants won't switch over.

Sat, 11/30/2013 - 00:29 | 4201273 SpykerSpeed
SpykerSpeed's picture

The gold bugs don't think things through, apparently.

Bitcoin requires zero trust.  Any gold "backed" currency requires massive faith and trust in humans.

Sat, 11/30/2013 - 14:16 | 4202044 Captain Benny
Captain Benny's picture

Bitcoin requires trust in encryption and hashing.

Sat, 11/30/2013 - 06:55 | 4201599 lickspitler
lickspitler's picture

This dude is CIA/NSA all day. This is the FED after your stack man. Also there is some bad acid out there man.And can everybody get off the towers.

Fri, 11/29/2013 - 22:21 | 4201026 Uncle Sugar
Uncle Sugar's picture

Fonestar you okay?If you don't hold it, you don't own it.

 

http://finance.yahoo.com/news/9m-bitcoin-haul-buried-u-160800943.html

 

Fri, 11/29/2013 - 22:40 | 4201079 Professorlocknload
Professorlocknload's picture

Uncle, is that deflationary?

Sat, 11/30/2013 - 00:36 | 4201288 SpykerSpeed
SpykerSpeed's picture

Us Bitcoiners are really quaking in our boots over this new gold "backed" currency.  Like that's never been tried before.

Sat, 11/30/2013 - 11:37 | 4201799 Keyser
Keyser's picture

Since when did an investment strategy become as divisive as the Man U vs Leeds rivalry? 

Sat, 11/30/2013 - 11:58 | 4201822 Creepy Lurker
Creepy Lurker's picture

Agree. I don't really get it either. You want gold, buy gold. You want bitcoin, buy bitcoin. Understand the risks inherent with either, or anything else you invest in.

I know, this is fight club and all, but I prefer to save my vitriol for the statists rather than owners of IBM shares. (or bitcoin, or what have you)

Sat, 11/30/2013 - 01:54 | 4201390 U4 eee aaa
U4 eee aaa's picture

We should teach these bitcoiners how to take their bit coins on boat trips instead

Fri, 11/29/2013 - 22:22 | 4201029 Midas
Midas's picture

You know what this place needs?  A fresh Bitcoin debate!!!

Fri, 11/29/2013 - 22:28 | 4201042 Mudduckk
Mudduckk's picture

More Cow Bell.

Fri, 11/29/2013 - 22:34 | 4201060 CoonT
CoonT's picture

there it is :)

Fri, 11/29/2013 - 22:32 | 4201053 Number 156
Number 156's picture

God help us..

Fri, 11/29/2013 - 22:56 | 4201115 dark pools of soros
dark pools of soros's picture

keep hashing

Fri, 11/29/2013 - 22:33 | 4201057 seek
seek's picture

LOL.

Sat, 11/30/2013 - 00:45 | 4201301 putaipan
putaipan's picture

fonestar v.s. the frog inna cage match ......

 

 

 

i happen to think all these names that i'm seein' for the first time around these parts are trolls for the new chinese/rothschild gold backed crypto-crap that the pope wants to release

Fri, 11/29/2013 - 22:23 | 4201034 sosoome
sosoome's picture

Who's gonna keep an eye on the guys who are watching the guys holding the gold?

Fri, 11/29/2013 - 22:31 | 4201046 TheHound73
TheHound73's picture

Me, that's who.  Y'all trust me, right? Maybe I'll be able to sneak in some tungsten, exchanging it for real goods and services with a few mouse clicks.

Fri, 11/29/2013 - 22:57 | 4201116 dryam
dryam's picture

The guys who watch the guys who watch the guys who watch the guys who watch the guys who watch the guys who watch the guys with the gold would be the Rothchild's.  Well, actually the gold being watched is Tungsten and the Rothchild's actually live on top of the real gold vault.  No gold ever leaves the real vault, but gold continually keeps coming in.  Those interest payments are a bitch.

Fri, 11/29/2013 - 22:37 | 4201069 F-Tipp
F-Tipp's picture

Who monitors the monitors of the monitors? ~Will Smith's wife in Enemy of the State.

Also holy shit is that movie a documentary in retrospect?

Sat, 11/30/2013 - 00:24 | 4201255 dracos_ghost
dracos_ghost's picture

Their Fathers and Their Fathers Fathers and Their Fathers Fathers Father.

Sat, 11/30/2013 - 00:38 | 4201289 SpykerSpeed
SpykerSpeed's picture

Bingo.  This is just replacing the Rothschilds with a new master.  "Backing" requires faith.  Bitcoin doesn't.

Sat, 11/30/2013 - 10:52 | 4201745 Wen_Dat
Wen_Dat's picture

False. Bitcoin requires faith, or you wouldn't use it. That's why a lot of people on this forum don't trust it. Lack of faith.

Fri, 11/29/2013 - 22:25 | 4201038 chrsjrcj
chrsjrcj's picture

Remember, you don't own unless you hold it. 

Sat, 11/30/2013 - 05:13 | 4201554 Kirk2NCC1701
Kirk2NCC1701's picture

And if you hold it, they'll have a way of getting it. If you have enough or are otherwise targeted.

Being 'merican isn't what it used to be, now that our Gov has been completely taken over by 'alien' occupiers.

Fri, 11/29/2013 - 22:30 | 4201049 Number 156
Number 156's picture

I'm sorry, but this is just really stupid. You want something backed by the value of gold, get GOLD. Gold is guaranteed by the laws of physics to be backed by its own weight in gold.

Fri, 11/29/2013 - 22:38 | 4201074 seek
seek's picture

I agree, buy Phyz is hard to subdivide for small purchases, and has to be transferred in person. Being able to electronically transfer title to AU at the microgram level would open a lot of doors to its use.

If you did something like bitcoin, but had to assign 1oz of AU to register 1 coin into the blockchain, you'd have a nice e-currency, but you'd still have the centralization problem (someone has to store the gold, even if it's distributed over 1000s of vaults, and then you have to trust that someone.)

Fri, 11/29/2013 - 22:43 | 4201086 WmMcK
WmMcK's picture

... Phyz is hard to subdivide for small purchases

Ag, Ni, Cu.  Worked fine until 1965,

Fri, 11/29/2013 - 23:34 | 4201177 LibertarianMenace
LibertarianMenace's picture

Bingo. A competitive note issue using specie-backed notes can make browning bananas a more legitimate currency than the FRN. While the use of gold is sufficient to back an honest money system, it's a common mistake to think that it's necessary.

Sat, 11/30/2013 - 20:44 | 4202676 carlin401
carlin401's picture

But's its long been cited by Krugman and et-al ( greenspan, bernanke ) that taking away fiat, would take away their FUN,

For once all 'money' is backed by something 'solid' then they can't pull any 'money' out of their ASS ( USD's ), or out of the Ether (BTC's).

Given that 100+ years of the USA has been about 'bubbles', and given that 99% of the USA public are walmart going fucking assholes that love the bubble economy, and given that the folks who think 'money' should be backed by tangibles is a tiny fucking population of the world.

It really only leaves us with the choice that those of us that think money should be backed by tangibles, that we should live on our own island country, far away from Krugman's.

Think Galt, Go Galt.

Sun, 12/01/2013 - 15:26 | 4203898 LibertarianMenace
LibertarianMenace's picture

I hear they're planning a one-way manned trip to Mars. I wonder how much of the prog mentality will, Alien-like, stow itself away on the trip out, only to re-emerge once again when the earthen expats make landfall.

The Gulch is a non-starter...like Aliens, prog urges have an incredibly difficult time staying dead.

Fri, 11/29/2013 - 22:46 | 4201095 Professorlocknload
Professorlocknload's picture

So, we can't just download the AU, open the DVD drive and take out the coin?

 

Sat, 11/30/2013 - 06:15 | 4201582 lewy14
lewy14's picture

Disagree somewhat.

"Microgram level" is what the copper-nickel fiat in your pocket is for. This has always been so.

It's the $Benjamin level where it gets interesting. Middle East style - the commodity bangle - interchangeable as an Eagle, and (more or less) self authenticating as a coin, only unobtrusive and less vulgar. And more appealing to women.

Create the right bauble, authentication mechanism, and very liquid, low spread, low overhead, and anonymous purchase / repurchase system, and you'd have something..

Sat, 11/30/2013 - 02:14 | 4201411 Advoc8tr
Advoc8tr's picture

Exactly why you use BOTH.  Hold in phys ... transact in BTC. As mentioned above Bitcoin requires zero trust whereas a backed currency always does. So long as the quantity is limited and the blockchain transparent it is good to go.

Fri, 11/29/2013 - 22:32 | 4201052 Occident Mortal
Occident Mortal's picture

Crypto gold?

This is getting closer to something that can be more widely accepted than by a niche of geeks and techno-dreamers.

Crypto-gold might actually work how money was originally supposed to work. As an unforgeable receipt for gold on demand.

The problem with Bitcoin is that someone can always create more crypto currencies to compete alongside it. Litecoin, namecoin, etc, etc a million others.

But if each crypto block was backed by gold... Then it is truly inflation proof and free to transport.

The only problem is the transparency of the gold.

Fri, 11/29/2013 - 22:44 | 4201092 willwork4food
willwork4food's picture

A global based currency that is traded and respected with the ability to purchase REAL gold or silver through said global currency, will, by its nature find the current true value of deliverable gold or silver. This is what is fascinating about cyber currencies. If you can find someone that will sell it by definition- it is already backed by precious metals.

Fri, 11/29/2013 - 23:46 | 4201192 Buckaroo Banzai
Buckaroo Banzai's picture

Yes. Currencies have value because everyone agrees they have value.

Is it fungible? Divisible? Scarce? Hard to counterfeit? Durable? Difficult to debase? These are all properties that people recognize have value.

A currency doesn't have to be "backed" by anything, as long as it has all of the above qualities.

The fiat dollar became worthless in 1913 because it became easy to debase thanks to the Federal Reserve, which was granted the authority to do so, even though technically it was still backed by gold.

E-gold's problem is that it is controlled by a central authority-- the e-gold management. They will be in a position to debase it at any point; sooner or later, they almost certainly will.

Sat, 11/30/2013 - 02:33 | 4201431 willwork4food
willwork4food's picture

E-gold's problem is that it is controlled by a central authority-- the e-gold management

spot on.

Fri, 11/29/2013 - 23:00 | 4201121 dark pools of soros
dark pools of soros's picture

you stackers are real romantics aren't ya??  hate the evil nerdy logic but love the romance pie in the sky belief systems

 

 

 

 

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