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Author Topic: Which coins are fungible and why this is important?  (Read 335 times)
owm123
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September 03, 2015, 01:32:10 AM
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Here it says that "Fungibility":

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The state of being interchangeable. For example, money has fungibility because there is no difference between one dollar and another dollar. Likewise, stocks of the same type in the same company and commodities of the same quality are generally fungible. On the other hand, assets like land or baseball cards are not fungible because each unit has unique qualities that add or subtract value.

This question is based on this post in which it says that Monero is fungible and it suggests such fungibility is good. But why would a person want this in a crypto coin? I'm not a finance expert so I dont know, why should I care (or care not) about fungibility? Are there any real life examples with cyrtopcurrencies in which such future would be desired? And which other coins have this "future" or "characteristics".

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monsterer
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September 03, 2015, 07:13:41 AM
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Imagine I give you a token, called it TKN, which is supposed to be worth $1, but is actually worth $0.99. Then suppose I give you another TKN token, but this one is worth $1.01. Now you have two TKN, both which are worth different amounts. How do you trade them?

That is non fungible currency.
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September 03, 2015, 07:23:07 AM
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A lot of the "reasons" people give for why something like Bitcoin might not be "fungible" actually apply to dollar bills, hundred dollar bills and such too.

Because most of the arguments seem to be about the fact that there is a history, such that if you accept stolen coins or stolen money you could end up being accused of accepting stolen property / money.

The general idea is that a dollar or coin you receive from a terrorist group, or from a robbery, might not be as "valuable" to you, or even if not to you then to who-ever you would like to have accept it from you in payment for something, as a squeaky-clean dollar or coin  minted specially for you by some party that is imagined to be or officially purported to be in some way "cleaner" than a terrorist or robbery.

(Such as a government, a lot of governments like to purport not to be gangs of crooks with their hands soaked in blood...)

Actually you can even put aside any question of actual clean-ness really, and just consider that regardless of how clean or unclean a dollar or coin might "in reality" or "in some arbitrary or non-arbitrary moral or ethical system" be a dollar or coin the possession or which or the spending of which is going to bring armed thugs pounding on your door, or get you incarcerated, might not seem as "valuable" to you as one which does not carry with it such threats.

So in general, a dollar or coin or product which is under some kind of blacklisting or threat can be seen as less "fungible" than one that no one is going to threaten you or arrest you etc on account of if you chose to accept possession of it.

In that sense though of course fungibility can be said to be in the barrel of the gun of the threatening party rather than in the dollar or coin or whatever whose fungibility the gun-toters are trying to influence by means of their guns...

-MarkM-

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