Bitcoin Forum

http://www.bitcoinrumors.com/2013/04/17/prince-of-sealand-mentions-interest-in-bitcoin/ (http://www.bitcoinrumors.com/2013/04/17/prince-of-sealand-mentions-interest-in-bitcoin/)

http://www.bitcoinrumors.com/2013/04/17/zimbabwe-officially-approves-bitcoins-as-official-national-currency/ (http://www.bitcoinrumors.com/2013/04/17/zimbabwe-officially-approves-bitcoins-as-official-national-currency/)

News about new official currency for Zimbabwe sounds very interesting but not much information provided yet. If you know anything more, please comment.

That sounds great but is it real or a joke ?
Would they use Casascius coins in the everyday life ?
I am very surprised.
It could be like the Euro for small nations. On one side to have the bitcoin symbol on the other side a national symbol.

Zimbabwe is not that small. Its M1 is $12G according to the CIA. That's much more than Bitcoin's monetary base has ever been, even during its all time high. I have a hard time believing this.

The Sealand story is more credible though, as that's a really tiny sovereign country (smallest on Earth?) and its prince seems to be tech-savvy. (they attempted to make Sealand a data haven, for ex.). But still, I wouldn't hold my breath. Let's see.

I still dont know how people living there can use bitcoin to purchase food? Bitcoin Credit card?

I think i read somewhere that digital cash is already very popular in Africa and that they do most payments with their cellphone. Not sure though. As for the Zimbabwe story, sounds more like a joke to me.

I don't think they can, as of today.

If this was for real - I don't think it is - then eventually the means would show up. Physical representations of BTC could be used, although they should be discouraged due to counterpart or counterfeit risks.
Something like Coinapult SMS wallet (http://coinapult.com/sms-wallet) could work well too. SMS payments thrive in Kenya, I've heard.
Of all nations on Earth, I doubt there's anyone more used with price instability than Zimbabwe. So that shouldn't be as big a problem to them as it would be to others, even because with BTC prices would be mostly falling, making them richer, not the opposite they're are used to.

tl;dr: It would be great for them to do it.

I just don't believe it's going to happen.

I don't think it will work for any country to implement bitcoins as the official currency. The deflation would take away all the export gains of the country and isolate the whole country.

could you just run through this process a bit better it seems as though any deflation you mention would be greatly offset by purchasing power

also the country would be able to implement regulatory controls aswell

Until I read news like this at a website that doesn't have "bitcoin" in it's name, I'm not going to believe anything like this.

Zimbabwe dosn't have a currency it collapsed they use euro usd etc, bitcoin is a global currency its has official status everywhere

sealand is within uk territory now after they extended what is brithis (ie not international waters any more), i would think that platform is uk territory ?

Interesting link: http://www.sealandgov.org/title-pack/lordladybaronbaroness

It seems that you can buy a title for £29.99. Nice :)

It's a fake to make you to buy more bitcoins.

So Zimb goes from being the most inflationary country to the most deflationary country in one hit.....

I think they don't export so much and they are already isolated.
May be they are meaning to introduce bitcoins for foreign trading which would help imports.

lol mentioning Zimbabwe is not going to do Bitcoin any favours its pretty funny though, they should try litecoin or something more suited to

their weak monetary base

Bitcoin has never been tried at such a wide scale in a single country, this is probably bupkiss though given their hyperinflation problems making their existing money absolutely worthless I could see this happening in some country sometime soon.

Why is deflationary a bad thing? Is it bad your money continues to appreciate in value over time instead of losing it like the Euro of Dollar never to recover their spending power? People need to disconnect fiat currency from crypto-currencies, they do not work the same and cannot be compared in an economic way. Bitcoin's deflationary nature ensure hyperinflation never occurs which I think has been proven to be infinitely worse for an economy.

yeah, run by HavenCo

there was some news article I read in February this year that said they were going to attempt to start it up again "later this year"

CNN reports also:
http://ireport.cnn.com/docs/DOC-957375
Lets see.
It bitcoin goes up this month over 500 $ then we know why.

Its a CNN iReport by "BitCoinSachs".  Yea right  ::). And since when did CNN become an authority on Bitcoin?

Well let's say a corn farmer in Zimbabwe gets paid 10 BTC a month. To be able to to pay him 10 BTC a month the owner has to sell 1 kg of corn for 1 BTC. Let's say his exporting the corn to the neighbouring nations. When the value of 1 BTC rises the corn gets too expensive for the importers and they start importing from elsewhere. A country has to do business with other countries or else it will end up like North Korea. So when the whole world has inflating currencies and 1 country has a deflating currency they will have a hard time.

Brushan, if you analyse your argument a little deeper basically what you're saying is that the purchasing power of everybody else should be kept weaker than what it can be just to help exporters.

That's wrong both ethically and economically.
No, you should not decrease the purchasing power of an entire society in order to temporarily help a segment of it. When your money earns value, you earn more purchasing power and you become richer. So if the money of an entire country is getting more valuable, everybody in this country is getting richer!

And this effect over exporters is much less worse than what people make it look like. With his stronger money, the exporter farmer of your example will have more purchasing power to acquire more tools/machinery and be more productive, for example. Also, since the value of money increased, people can receive nominally smaller wages - which could be actually higher in purchasing power.

I understand your argument and i know many on this forum share it. I'm not saying i'm right and your wrong. Hell, people have been battling about this for a long time and still there is no consensus. The problem i see with your argument is that when you give the farmer less BTC every month because it is worth more he won't be able to pay back any loans he has. You could solve it by making the loan less BTC every year but then why would anybody lend it if you win more by just holding.

To be honest i don't see a problem with an inflationary currency. In my point of view, i see currency as one thing and a store of value as another. I think of currency like a hot potato which you want to hold for as little as possible. It's just something that makes trading easier but doesn't have any value by itself. Also when a currency loses purchasing power, the wages become bigger so there is balance. So when a worker gets his paycheck, he buys food, pays his rent etc and the part that he wants to save he invests in gold, silver, real estate, BTC etc. Nobody is forcing anybody to hold a currency, i don't see why somebody would like to hold it and complain that it loses value.

Loans in BTC particularly are not feasible due to its extreme volatility.
But if a currency is used by an entire nation, its price won't fluctuate that much. A stable currency would increase in value proportionally to the economic growth of its user base. Loans would then be a possibility, likely with low interest rates. Like they were during the gold standard (during the second half of the XIX century in the US, for instance, prices would systematically fall)


You're ignoring that inflation is not neutral. Those who receive the money first profit from those who receive it last, by being able to buy things before prices account for the new money. When the last people in the chain receive the new money, it'll be already too late. So, at least (when we're talking about 'simple inflation'), it is a nefarious wealth transfer mechanism. It's the most disguised of all taxes, and tend to hit harder on the most ignorant and/or poor.
And that's not all. Inflation nowadays is not simple. It's always directed to the credit market, creating signals to investors that there's lots of resources to invest in long term projects, Obviously creating money doesn't create resources, so this false signal will trigger a malinvestment boom which will result in a burst. These boom and burst cycles result in lots of lost capital. You can read more here:  https://mises.org/daily/672


You're forced to hold at least some because you're forced to pay your taxes in fiat. The network effect of the banking system will also ensure you hold much more than what you strictly need only for taxation.
Let's hope Bitcoin makes it easier to live without fiat one day. ;)

I'm still not convinced but i have saved the link and will read it when i have time. Thank you and hopefully i'll learn something new.

Yeah i read in another thread about their system called Mpesa. Maybe we can learn something from them and create a layer for bitcoin that is similar to their system to make BTC payments more user friendly. I'm not a programmer but if a developer could make something similar i think it would be a huge leap for Bitcoin.

I've heard of important bitcoin advocates trying to convince small nations to adopt bitcoin as official currency. This would make impossible to make bitcoins illegal.

Regarding the practical feasibility of this, there's a lot to speculate though.

But tying your currency to an inflation free-index is a solution that has been used with success in order to stop inflation. In Chile, my country, we have since the late 70's something called "UF" which is an alternate currency that readjust every month according to inflation. This currency is used in almost all real state transactions and for most credits. You can even make time deposits in UF to protect agains inflation.

Perhaps they don't need to actually use btcs, but just tie the exchange of their currency to btc prices.

Cheers!

Not impossible but harder.

A small nation can be coerced pretty easily.

The Zimbabwe's content is updated with information from CNN.

lol what a load of bullshit
'unidentified source'
'unknown journalist'
right... go on...


I thought Zimbabwe is mostly underdeveloped as in, no power or much technology to support the bitcoin system...?

Sealand I'm all for.

Zimbabwe not really.  That economy is a massive mess and this whole idea doesn't make a lot of rational sense to me.

I don't know, I'm still very sceptical. The Sealand story, looks pretty legit. The Zimbabwe story, everything out there points back to the CNN story, which is one without sources... So unless we get any other reports. (google hasn't found any yet) Looks like its fake :(

Zimbabwe can launch their own coin with centralized control. Why do they need Bitcoin?

That isn't really true though. Why would we have to pay him 10 BTC a month if we cannot afford? When the value of 1BTC rises he can adjust his prices to 0.1BTC and then it solves everything.

What if the poor bastard has a loan of 100 BTC? How will he ever repay that? If you mean that we should also lower the loan then you won't find any lenders since people make more money by holding it than by lending it out. I'm in no way for todays economic system. It was my disgust for the bankers that made me interested in Bitcoin from the beginning. I just don't think a currency with bitcoins rate of deflation would do any good for a nations economy. There are other ways from my point of view.

May be some people are dreaming about a Pan-African financial unity:
http://afrinnovator.com/blog/2013/04/01/bitcoin-crypto-currency-and-the-opportunity-for-a-truly-pan-africa-money-revolution/

http://ireport.cnn.com/docs/DOC-957375   <----  fake.

It's impossible for them to adopt bitcoin in it's current form...   freaking 900 days out of the starting line and with the infrastructure of the commercial internet... circa 1993.

unless....  well....   if they backed some sort of paper currency with bitcoins then I supposes it's possible....

publish a blockchain address and just print based on that blockchain address..    let's say they had 500,000 bitcoins... then they print off a million notes for each bitcoin or whatever they hell they want.

Their currency would flucuate like mad because it's tied to bitcoin not gold ... but if it's actually convertible from their paper to bitcoin at a set exchange rate it might stabilize both.... actually scratch that.. it would stabilize both...  because as far as they would be concerned people outside the country paying for diamonds or whatever would be paying directly in bitcoin, hence allowing them to increase their printing press...

Predatory lending happens in general with or without Bitcoin. Btw there are people who lend Bitcoins already because you do make money lending it out and getting interest. Deflation is a good thing, you just can't make sense of it because you're used to the world of credit and inflation rather than saving. You don't need to take out loans as big when you're in a deflationary economy.

People also forget that Ripple allows for the loans and lending element of BTC. Loans and lending already aren't going to be a problem.

here's a google news search of the past week with "zimbabwe + bitcoin"

...nothin: http://www.google.com/search?client=safari&rls=en&q=zimbabwe&ie=UTF-8&oe=UTF-8#q=zimbabwe+%2B+bitcoin&safe=off&client=safari&hl=en&rls=en&tbs=qdr:w,sbd:1&tbm=nws&source=lnt&sa=X&ei=HxdvUaGIBsGpiALH5YGoAQ&sqi=2&ved=0CCQQpwUoAQ&bav=on.2,or.r_cp.r_qf.&bvm=bv.45368065,bs.1,d.cGE&fp=bdbabb10b94ab79&biw=1658&bih=940

Well whatever the report is,  evidently people are buying bitcoins again...  we just passed a billion dollars again (http://www.ounce.me) (first time in days)  

For the record...  I don't trust that report....  

seems like it saw already some cc

Yes the farmer doesn't get business but it doesn't matter because he's richer. The IS a argument to be had in that it weakens the people's ability to farm. By being rich you just pay for what you need. That's why us in the wealthy countries have gone soft. And there's nothing wrong with that. "The best thing to do is let other's suffer the death and hardship and then have their babies." -satan

If this piece was better written I would've assumed it was scraped off The Onion...  ;D

While I doubt this article is true, I can see a use for bitcoin in a nation (like Zimbabwe) where corruption and mismanagement in government has repeatedly proven that they cannot be trusted with the nation's currency. Farming this out to a decentralized uncontrollable base like bitcoin could work, imo. It would force fiscal responsibility, and while I recognize a deflationary economy may have it's theoretical disadvantages (as mentioned earlier), I think it is better than the alternative of hyper inflation even from a conventional sense. When you think of it from a non-conventional sense, like a shift away from debt based economy, it makes even more sense. But... we have let to see if that is viable in a modern world.

I think it is.

+1
However, without a robust distributed infrastructure for instant digital currency conversion this becomes a massive clusterfuck whenever they see significant BTC price action. IOW, I don't think you can denominate 100% of a nation's money supply in bitcoins, even in the case of a banana republic. It's way too risky, there's too much price instability. But they could use the shit out of bitcoins and gain a great deal imho.

im nativ. lemme pass to zimbabwe

http://www.newzimbabwe.com/opinion-10878-Virtual+currency+in+the+digital+economy/opinion.aspx

If that, they all trade in gold flakes.

Zimbabwe would be the worst thing for bitcoin, most live out in the motherfuckin boonies and probably have only seen a 1995 computer in some store that's a 5 month walk to get to.

Yes, I'm saying Zimbabwe is to poor for us to want them to be the first country to adopt bitcoin.

As an official REPLACEMENT currency, no. Not least because they don't have one and are using USD at the moment.

However for anyone in Zimbabwe it makes huge sense to use BTC when possible, and certainly makes sense to accept them as payment.

If it does take off over there I see a great opportunity for selling cheap Android smartphones from China...





AC

Africans are interested in bitcoin:
http://2feetafrica.com/2013/04/5-african-countries-to-install-bitcoin-atm/

I'm afraid bitcoin is too high tech for Zimbabwe. A scheme like M-Pesa is much better since it works with text messages. We should also consider that many transactions seen as important there, will be seen as dust in America or Europe.

Coinapult SMS Wallet (http://coinapult.com/sms-wallet) is to Bitcoin what M-Pesa is to whatever fiat currency they transfer.
The problem with coinapult is that their sms wallet is only available in Canada+USA, two countries that don't really need it.
If somebody with good connections with mobile operators in these poorer countries builds something equivalent, there's a chance it'll take of. Actually, M-Pesa itself should seriously consider adding a bitcoin wallet option.