Will Bankcoin be appearing any time soon?

[CIYAM]

A blockchain with PoW only makes sense if it's open to competition.

It would be open to competition - but that competition would be limited to registered banks.

Understand that although I really do like Bitcoin (and would love to see it become widely adopted) I just think that it's naive not to think that Bankcoin won't be the more likely successful version of the technology (when the cost to the banks is virtually zero to turn their bad rep around any PR company worth its salt would already be suggesting this if they only knew about it).

Wait...you're willing to bet that banks WILL NOT inflate a currency into oblivion? Where do I sign up to bet against you? Interesting idea, but I don't see banks going for it if they cannot use inflation as a hidden tax on the unawares.

Banks in China allow you to purchase gold (and you can buy real gold rather than paper gold and of course it comes with paperwork to guarantee it) - please tell me how they are taxing that with inflation?

[markm]

Mint all the coins from the start. Then who would even bother to compete just for a share of the transaction fees?

I suppose how much there is in fees would decide that, but hey if they made it merged mine able with bitcoin, they could get a whole lot of bitcoin's hashing power on board as well as whatever ASICs the founding banks choose to deploy.

Probably the main reasons this did not work out well for the Bank of Mars, Canuck Bank, Britclan Bank etc etc with their Martian BotCoins, Canadian Digital Notes, United Kingdom Britcoins, etc etc etc was insufficient transaction fees and an irrational hatred of altcoin on the part of bitcoiners.

Rather than try to depend on keeping their connection ports secret to prevent attack, they moved to Open Trnsactions for now, figuring they can move back to blockchain format when transaction fees are sufficient to attract miners to merged mine them, or maybe nowadays it might turn out that they might as well just use the coloured coins concept.

With coloured coins each bank could issue a new set of coins any time they want to inflate, and they can all deploy ASICs if they like to help the blockchain or just leave that to bitcoin miners.

-MarkM-

[molecular]

A company could issue a coin that is backed by its cash reserves. Google for instance could issue 21 million coins backed at $1 each.

Doesn't sound very appealing. Some miners will jump on it and redeem for dollars. Also not easy to do for google because of regulations.

[J-Norm]

I can see banks re-using the public/private key system to move money around in a ledger. The difference would be that the public key would need to one issued/signed by a bank after identity checking you and they would back it directly with fiat currencies.

They would far rather have a system where they could create an arbitrary amount of money, the world economy as it is sort of relies on it. They would certainly never support a currency that they could not inflate.

[CIYAM]

They would far rather have a system where they could create an arbitrary amount of money, the world economy as it is sort of relies on it. They would certainly never support a currency that they could not inflate.

Allow me to quote myself:

Banks in China allow you to purchase gold (and you can buy real gold rather than paper gold and of course it comes with paperwork to guarantee it) - please tell me how they are taxing that with inflation?

BTW I am not talking about the banks necessarily using Bankcoin as a "currency" but more as a digital commodity.

[molecular]

I think I can see the point of BankCoin now: it would not be something the general population needs to trust, basically just an interbank settlement currency the banks agree upon as a group. It would be politicized and regulated.

Reminds me of vaults in New York with different appartments for the different banks and carts of gold being rolled around for settling inter-bank balances. Now clearly the problem with this gold approach is the transaction and security. The system with having all the gold in one place is not a good idea (see: german bundesbank tries to verify it's gold holdings in the US <- my personal opinion: that gold is gone). So that system failed.

Enter BankCoin as a solution?

I think it could work. However I would suggest to explore something else than Proof of Work. Explore Proof of Stake (which I don't fully understand yet), some variant of which could make much more sense.

BankCoin would be transparently auditable and easily transferrable for settlement purposes (probably a 1 bank - 1 address approach would be preferrable). It would be easy to protect against theft or other manipulation by the individuals banks (safekeep the key and have a secure method of transferring BankCoin, Banks are good at such things).

I wouldn't call BankCoin money, though. It's just a ledger.

Now wether the Banks of the world would want such a transparent, fair and easy to use system for interbank settlements is a different issue.

[CIYAM]

I hadn't actually thought so much about the interbank settlement currency (although that does sound like a very good use case).

Whether PoW or PoS or other variant is best would of course depend mostly upon want the banks would agree to (although I do think that at least some portion of PoS might actually be more preferred to prevent the currency being >50% attacked).

I still think that the opportunity for a huge PR boost (if the banks were to offer non-inflationary investment as an extra "account") vs the cost of setting up the system (virtually zero compared to the advertising campaigns that would follow) would see an "overnight success" (which of course unfortunately would drive/keep Bitcoin underground).

If some of the name banks in the world were to offer such an account tomorrow (with all the guarantees of a bank) then I think I'd probably invest 10 times as much in that than I would invest in Bitcoin (at least as things stand at the moment).

[markm]

Rather than even making a new chain that can be merged-mined with bitcoin to gain some of bitcoin's existing hashing power it might make more sense to use coloured coins right on the bitcoin blockchain, along with buying up ASICs constantly to keep increasing the hashing power.

-MarkM-

[VeeMiner]

Banks already have such a currency. It's called money. Right?

+1

[hashman]

I've been wondering the same thing for a long time now   What are they up to? 

DAT makes a good argument, however there are a lot of potential variations.

Allowing the public to mine, but giving certain keyed miners the ability to counterfit a bit more, er I mean create credit, would give the pyramid control freaks their fix but still give us all the advantage of a public money supply, i.e. we would know how much was out there and not have to trust "M3 shadow stats".   

This could even be implemented with current money supplies in something like Basel 4. 

I'm not sure I like it, but I'd be surprised if we don't see something like this in the next decade. 

[CIYAM]

Actually if I was the Chinese government I'd be considering Bankcoin very seriously (and who knows maybe I will be contacted about it?) as America has screwed them badly with their QEx tricks and inflation is a huge worry in PRC (with preventing a revolution always being a major consideration).

Of course if different Bankcoins were to appear in different countries (i.e. only able to be mined within their own country) then it would be interesting to work out which would be trusted more (I don't think I'd be investing in Americoins).

If this occurred then the new Ripple project would be likely become a very important mechanism for interbank transfers of Bankcoins.

[ozzishadbank3]

It amazes me how you guys saw Bankcoin 6 months ago and what you are talking about is actually playing out.

Great work guys you should pick this thread backup and lets make a few things happen

[CIYAM]

It amazes me how you guys saw Bankcoin 6 months ago and what you are talking about is actually playing out.

Try 18 months ago (I started this topic in 2012 not 2013) but am not sure what you mean by "is actually playing out" - care to elaborate?