Bitcoin Forum

Has anyone ever tried to release a coin and peg it to the dollar?  I would like to start a project like this; as an attorney I can handle the regulatory/government side of things, if we could get some alt coin community buy-in on the idea.  It IS NOT impossible to do, no matter what you may have heard or read; its just impossible to do on the LD.   I think I know how to pull this off, but there is no way I will go at it alone.  

Advantages:  Built in value. Instant recognition around the world.  No currency conversions necessary.  Sell anything anywhere in a price that everyone knows. Would allow a true dark exchange or blind escrow to take place. MOVE DOLLARS INSTANTLY.  Very attractive to retailers and cross-border trading, even large transfers.

Disadvantage:  No/Limited return as an investment. (No reason to hold on to them as they wont increase in value). High value target for double spend attacks. High value target for future government regulation. No incentive to be early adopter.

I would be interested in your thoughts or ideas.

The Brits and Canucks tried this with United Kingdom Britcoins (UKB) and Canadian Digital Notes (CDN) respectively.

( See http://galaxies.mygamesonline.org/digitalisassets.html )

Their theory was that actually "backing" coins by retaining everything they sold them for to use as "reserves" with which to buy them back would work out much better than trying to "back" coins that random miners all over the world were mining and dumping without offering to buy them back.

However they also used the bitcoin approach of only ever having 21 million coins in total.

As a result, other nations and corps that were not trying to "peg" their own coins to fiat tended to take advantage of the "low" prices the Brits and Canucks tried to maintain; basically whenever the Brits and/or Canucks sold off their own coins "cheap" to try to prevent their price rising higher than the fiat they were trying to "peg" to, others, particularly the Martians, would snap them up.

So I guess for starters you will need a coin you can mint more of as needed, so that any time its value tries to rise higher than the fiat you are hoping to "peg" it to you can mint more to sell to try to bring the price down to fiat-parity.

The Mastercoin project and the Bitshares project have ideas they plan to try for "pegging" somethign to fiat, have you looked into those?

-MarkM-

Lets suppose that I sell $1 USDe to Party X for $1 USD (I now have one dollar and he has an electronic copy), Party X in turn trades his USDe with Party Y for legal goods and services.  Over time there might develop a secondary market for the electronic copy, lets say in Japan, where Party Y could sell his USDe to Party Z for $1.05, even though Party Z knows that Party X only paid $1 for the USDe.  That would be of no interest to me... because I only would have a legal obligation to give Party Z $1 USD if he should make demand for exchange.  In other words, I would only have to "peg" the exchange (1 USDe = 1 USD) ... who cares what happens in the secondary market?  The real idea would be to facilitate trade efficiently and effectively.