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Breaking the Definintion of Money and Inhibiting Seigniorage (Money Printing) with Asset Backed Bitcoin
Veritaseum will be announcing asset-backed bitcoins after the end of the token sale. These are bitcoins that will have both the full value and capability of bitcoins that actually ride along the bitcoin blockchain plus the additional attribute of being backed by a variety of real world commodity assets. This essentially inflation-proofs the coin (more so than the possibly deflationary effect of limited supply) and in addition it puts a hard floor on the value of the coin - setting it aside from bitcoins not modified by Veritaseum.
The Accepted Defintions of Money
According to Wikipedia:
Money is any item or verifiable record that is generally accepted as payment for goods and servicesand repayment of debts in a particular country or socio-economic context.[1][2][3] The main functions of money are distinguished as: a medium of exchange; a unit of account; a store of value; and, sometimes, a standard of deferred payment.[4][5] Any item or verifiable record that fulfills these functions can be considered money.
Money is historically an emergent market phenomenon establishing a commodity money, but nearly all contemporary money systems are based on fiat money.[4] Fiat money, like any check or note of debt, is without intrinsic use value as a physical commodity. It derives its value by being declared by a government to be legal tender; that is, it must be accepted as a form of payment within the boundaries of the country, for "all debts, public and private".[6] Such laws in practice cause fiat money to acquire the value of any of the goods and services that it may be traded for within the nation that issues it.
Commodity money, whose value comes from a commodity of which it is made consists of other things that have utility value in and of themselves in addition to the value attribuated to their use as money. Examples of such include gold, silver, copper, salt, cocoa beans, oil and barley. These items historically ran into practical barriers as the global economy expanded - through limitations in storage, transport and rancity - basically techological barriers. As such they were overtaken by representative money. 
According to Wikipedia, representative money is defined as:
- A claim on a commodity, for example gold certificates or silver certificates. In this sense it may be called "commodity-backed money".
- Any type of money that has face value greater than its value as material substance. Used in this sense,fiat money is a type of representative money.
Unfortunaely, as fiat took hold, the former defintion of representative money failed to hold sway - the result of which has been rampant seignorage. Seigniorage is the action of exchanging sovereign-issued securities for freshly printed money by a central bank. This is in essence, borrowing real money and paying with "created" money - or basically not needing to repay at all. These actions are not without consequences. Monetary seigniorage is an action which takes this theme a step further, wherein the sovereign entity relies on seignorage as an active revenue stream through regular and routine debt monetization (printing new money to repay old money to meet budgetary targets. The use (or misuse) of these newly printed notes can exacerbate the inherent problems of rampant monetization. For many developed nations, seignorage is relied upon as a regular revenue source, despite the fact it has wrecked the economies of smaller nations.
Sweeping up the banknotes from the street after the Hungarian peng?was replaced in 1946.

The United States is certainly not immune from these effects. The economic thirst of war has pushed the US to the brink at least two times in the past. Continental currency (the precursor to the current USD) printed during the Revolutionary War reached a monthly inflation rate of 47% in November 1779.
Again, during the U.S. Civil War, the 50 months preceeding April 1865 saw the Lerner Commodity Price Index of leading cities in the eastern Confederacy states increased from 100 to over 9,000.

The Confederate dollar was nearly worthless by the end of the civil war. Towards the north, greenbacks (the currency of the Union) were purposely inflated up to a 40% monthly inflation rate. In many of these instances, the money was purposely inflated to fund the war. This monetary seigniorage still exists today in the US and abroad.
Seigniorage in the United How Much Does the U. S. Government Make from Money Production?
Referencing the study made by Federal Reserve Bank's own St. Louis Fed...
As you can see, monetary seingniorage has been and is, a profitable business for the US and has been such for some time.

Seiniorage has been responsible for paying between 1% to 3% of the federal budget of the largest single economy in the world - but that's before the crisis and QE, which we will get to in a minute.

Pay very close attention to this table, where the US.gov had its debt bought outright by the Fed. The number peaked in teh '71-'80 period at just over $12B. Be aware that, pre-Bernanke Fed did not have a mandate (as popularly interpreted) to purchase private debt.

Let's look at this from a 2014 perspective, and please notice the delta in the numbers...
The 3 rounds of US QE:
- QE1 (December 2008). In December 2008, the Fed started buying longer-term Treasury securities as well as the debt and the mortgage-backed securities (MBS) of Fannie Mae and Freddie Mac, two government-sponsored enterprises (GSEs).[3] The Fed announced it would purchase up to $100 billion of the GSEs’ debt and up to $500 billion of their MBS from both banks and the GSEs themselves.
- QE2 (November 2010). In November 2010, the Fed announced that it would purchase $75 billion per month of longer-termed Treasuries, for a total of $600 billion. These purchases were to be concentrated in Treasury securities with maturities of two to 10 years, though the Fed also intended to purchase some shorter-term and some longer-term securities.
- QE3 (September 2012). In September 2012, the Fed announced its third round of easing, now referred to as QE3. Under QE3, the Fed’s combined securities purchases (long-term Treasuries, GSE debt, and MBS) were increased to approximately $85 billion per month. Unlike its counterparts, QE3 was an open-ended commitment. Rather than commit to purchasing a fixed amount of securities by a certain date, the Fed declared that it would make purchases until it decided that the labor market had sufficiently improved.
So we, go from $12B in US .gov debt to somewhere around $500B of the same in 2007, in addition to a category labeled as "All Other" to $4.4 Trillion as of last year, including unheard of asset classes in the comparable tables above - MBS, etc.). Even if one were to exclude such (and I query as to the reason why one would do that), there is still over $2 Trillion of note and bond purchases. If one were to linearly extrapolate the relationship between monetary senioriage in the tables above as a percentage of the US Federal Budget and the Fed's balance sheet bloat as a result of QE, it would look something like this...
Now, we're not economists at Veritaseum, and I'm sure this little analysis may be rife with holes, but its purpose is to illustrate the vast revenue and profit machine that is Monetary and Fiscal Seigniorage, ex. money printing. QE, NIRP, ZIRP generates funny money at the expense of the holders of said money. Reference this graphic from "How the Danish Central Bank is Destroying the Danish Citizens' Wealth Form Both Sides While Stressing It's Banks":

Other examples of current day seignorage and their results are exemplified by the Currency War series linked below. We, @Veritaseum, are using the power of the blockchain to resurrect commodity money and commodity-backed money in a fashion that brings it into the 21st century through our smart contracts technology. We will infuse bitcoins with a definitive floor value (but the coins will also feature the value of bitcoin itself, hence be able to float freely above said floor) based on the following liquid commodities:
- Gold
- Brent crude and heating oil
- Natural gas
- Copper
- Aluminum
- Corn
- Wheat
More info will be available after the Veritas sales end. Institutions and accredited investors who are interested in learning more can reach us here.
The Currency War Series:
- Despite What You Don't Hear In The Media, It's ALL OUT (Currency) WAR! Pt. 1
- Stab, er... I Mean... Beggar Thy Neighbor - It's ALL OUT (Currency) WAR! Pt 2
- As US Companies Report, Signs of Imported Unemployment/Deflation Appear: It's ALL OUT (Currency) WAR! Pt. 2.5
- It's All Out War, Pt 3: Is the Danish Krone Peg to Euro More Fragile Than Glass Beads? The Danish National Bank Infers So!
- Currency Brokers Fighting Insolvency Are Learning the Value of Our Blockchain Technologies - the Hard Way
- How the Danish Central Bank is Destroying the Danish Citizens' Wealth Form Both Sides While Stressing It's Banks
- Monetizing The Spear That The Swiss National Bank Hurled At Swiss Banks and Insurers
- advertisements -


Reggie, talk to the guys at Silent Vault.
and the problem with holding gold as a store of value?
and the problem with using any old currency that works, for the occasional purchase?
"and the problem with holding gold as a store of value?"
It tends to get heavy, difficutl to pass around.
"and the problem with using any old currency that works, for the occasional purchase??"
Because this is this is not a discussion about currencies. See the "nobody understands bitcoin" link above.
WHAAAAT?? No pictures of shirtless reggie???
My favorite term involving Bitcoin is "mining."
Bitcoin: Expending capital on computing power and then wasting it and electricity to create ones and zeros called Bitcoins that are of no use to anyone but oneself to trade for the production of others is called "mining."
Banksters: Expending capital on computing power and the wasting it and electricity to create ones and zeros called dollars that are of no use to anyone but oneself to trade for the production of others is called "printing," (counterfeiting).
The banksters need to repay us.
"I flipped the circuit breaker on my house, and then with a flashlight, checked that my gold and silver didn't evaporate. All was well."
i'm going to have to disagree on this one.
the fatal flawS of bitcoin are many but ---the ELECTRICITY----cost is actually quite low relative to the cost you are not comparing it to ; running a central bank police protected clearing debit system.
HOWEVER-----as with anything on the net, much is obscured.
bitcoins mining system is flawed for many reasons but NOT FOR THE REASON OF ELECTRICITY COST.
it MUST COST something to run an open decentralized ledger system that is capable of massive cryptographic hashing power while being robust to attack on the net.
any ----as the hardware gets more powerful -------the electricity costs go down per hash.
while many argue the bitcoin system is actually incapable of scaling to the sorts of power needed for dealing with visa/mastercard amounts of transactions, let alone CASH transaction amounts-----i think they are perfectly wrong about that.
networks scale rapidly when there is profit to be found in using them.
the nature of the bitcoin network has many fatal flaws and it probably will not last another 10 years before one of the many problems destroys it;
namaely;
1) political decision to outlaw it in the u.s.
2) a larger than usual stock market crash.
3) subversion of the network by a cartel of telecom companies allied with banks
4) a better network that isn't bitcoin
5) telecom ratcheting of bandwidth costs too high
the idea that bitcoins can be asset backed is garbage without federal oversite and open audits.
"the idea that bitcoins can be asset backed is garbage"
Too late, already done. I've got asset linked coins in the very same machine being used to reply to this post. Don't poo poo something simply because you don't understand it. Learn about it first, then criticize from an educated perspective, if possible.
reggie don't be an asshole.
TRUST IS BEHIND EVERY CLAIM OF BACKING AND YOU KNOW IT.
you know that 'open audits' means trust. why the fuck should i trust anything you say about how much gold is behind every bitcoin you sell?
it's called audits and accountability.
don't be an asshole and lie to people that some magic fairy can guarantee something because it's 'digital'. a physical asset backing ANYTHING INTANGIBLE REQUIRES TRUST.
i'm not interested in discussing how one intangible can back another intangible. if you wanna talk about side chains and other crap shit like that you may as well talk about securitization and cds and other intangibles backing intangibles.
there's always more 'intangibles' and fiat to back whatever bullshit story the fed, or the blockchain comes out with. people can make intanigbles all they want.
the reality is that TANGIBLE REAL GOODS ARE WHAT THE STUFF LIFE IS MADE OF AND VERIFYING THE POSSESSION OF THOSE GOODS REQUIRES EITHER NAKED TRUST (UNACCEPTABLE IN A TRUSTWORTHY SYSTEM) OR AN OPEN STANDARD METHOD OF AUDITING AND ENFORCEMENT.
IF YOU DISAGREE WITH THIS PLAIN AND OBVIOUS STATEMENT IT IS BECAUSE YOU ARE GOING TO THE DARK SHYSTER SIDE OF TRYING TO STEAL PEOPLE'S MONEY LIKE THE REST OF WALL STREET.
GOOD LUCK WITH THAT.
"I flipped the circuit breaker on my house, and then with a flashlight, checked that my gold and silver didn't evaporate. All was well."
So in other words - your value was actually verified by ones and zeroes ?
Talk about beating a dead horse.........
Is that what you try to do in front of that dodgy magazine ? Most folks use the internet nowadays.
Assuming that everyone has the same emotional and intelluctual maturity as you do, crazydork, is a mistake you make rather frequently.
That was pretty good :-)
Thanks Reginald. I thought so as well.
Reggie you are too early , you need to come back in 5 years time. This lot are a cross between a bunch of Cave Dwellers and The Flat Earth Society , they have eaten way too much prepper food and the damp from their basement has started to affect their brain function. Good luck trying to teach them. I just waste my time in here winding them up , but maybe you are aswell LOL .
Point the Luddites here: Why Almost Nobody (and I mean ALMOST NOBODY) Gets Bitcoin: Part 1 - the Definition
Those who at least want to be objective will get it. The rest? Well....
The fact that you, Reginald, are on the same side of an argument as the perpetual troll, known as crazytechnician, speaks volumes. My, how the once mighty have fallen. How's your buddy phonestar these days? We miss his rants. At least his posts were entertaining.
The only thing one needs to know about Bitcoin:
The Liberty Dollar (ALD) was a private currency produced in the United States.
The currency was issued in minted metal rounds (i.e. coins), gold and silver certificates and electronic currency (eLD). ALD certificates are "warehouse receipts" for real gold and silver owned by the bearer. According to court documents there were about 250,000 holders of Liberty Dollar certificates.[1] The metal was warehoused at Sunshine Minting in Coeur d'Alene, Idaho, prior to a November 2007 raid by the Federal Bureau of Investigation (FBI) and the Secret Service.[2] Until July 2009, the Liberty Dollar was distributed by Liberty Services (formerly known as "National Organization for the Repeal of the Federal Reserve and the Internal Revenue Code" (NORFED), based in Evansville, Indiana. It was created by Bernard von NotHaus, the co-founder of the Royal Hawaiian Mint Company.[3]
In May 2009, von NotHaus and others were charged with federal crimes in connection with the Liberty Dollar and, on July 31, 2009, von NotHaus announced that he had closed the Liberty Dollar operation, pending resolution of the criminal charges.[4] On March 18, 2011, von NotHaus was pronounced guilty of "making, possessing, and selling his own currency".[5][6]
https://en.wikipedia.org/wiki/Liberty_Dollar
If it's backed by something and not owned or controlled by Zion, it's a threat to them and killed.
What and who backs Bitcoin?
The banksters need to repay us.
You mean this guy? Quite an entertaining fellow... I've talked to him in depth in what he feels what "NOT" to do to end up in that situation.
The technology behind this stuff is extrremely, extremely misunderstood, which is why the Von Haus comparison is being made. I strongly suggest everyone of intelligence who reads this comment carefully review Why Almost Nobody (and I mean ALMOST NOBODY) Gets Bitcoin: Part 1 - the Definition
http://srsroccoreport.com/pilgrims-society-takeover-of-bitcoin-the-high-...
Good link, but I don't need others to compile a list of thieves for me to know who the thieves are.
"No them by their fruit.
The banksters need to repay us.
hard time with word definition which is the statement of the meaning of a word. and the definition of the word definition is, the meaning of a meaning of a word, and so on
I feel like AdBlocker should have kept this from popping up.
dat's racis!
Upgrade to Adblocker Pro - wait that didn't work either.