FreiCoin (FRC) discussion (was FreiCoin (FRC) for TRC, PPC, LTC or BTC)

[grondilu]

Bitcoin is agnostic about who receives the subsidy.

No, it's not agnostic: it gives it to miners. When creating money, you have to give it to someone. You just think that giving it to people with mining equipment so that can later made huge profits by selling after the price have risen is more fair. That's YOUR OPINION. I used to have the same opinion, but it's still an opinion.

Ohh yes, it is so fucking unfair that workers, who work not only for themselves but also you faggots sitting on their backs,
and through working actualy not only make your coin alive and kicking but the whole deal possible, might make huge profit.

I pray for a day when workers will stop, look at you bastards above and say "NO, FUCK YOU!" and than rip your heads off.

It's not like they are forced to work, either.   Last time I checked, workmen in factories are not tied to their workplace with iron chains on feet or something.  Oh, and they also happen to receive something that they are supposed to have agreed to receive in exchange of their work.  It's called "SALARY".

[scrybe]

A few major misconceptions I see folks arguing about:

80% of INITIAL distribution will be decided by the FreiCoin Foundation according to an open grant request process. If you have an idea for distributing FreiCoin in a way that will enhance adoption you will have a chance to submit your proposal and get the 100k FRC you need to start an FRC based rewards card or whatever your idea is (FYI, I have some ideas, but no programming skills worth talking about if someone is looking for help with the non-coding aspects.)

After 3 "coin-years" the Foundation is no longer funded by new coin generation, we are already over 3 months into this period given the accelerated block times. Once that 80% is distributed the foundation will have to operate on donations and volenteerism, using the 80% funds for the developers benefit is not part of the plan, it's about INITIAL coin DISTRIBUTION)

Freicoin is modeled after the works of Silvio Gesell who was seen as a Communist by Capitalists, and the other way around. (http://en.wikipedia.org/wiki/Silvio_Gesell) This IS a controversial idea to base a currency on, but it is not one that has ever been possible to test until the advent of cryptocurrency. Please be very careful with your knee-jerk reactions, the age of some of the writings may cause confusion given that the communism of the day was a very different sort and his writings have a lot of colloquial references to the time that are not easy to unravel. The theory behind Freicoin centers around a <1930 understanding of the world, infinite inflation was not considered a good thing, we didn't have pure fiat in the US, and communists were bombing and shooting to try to bring down the established order, even in the US.

Please remember that the word to use when talking about economic advantage is "insurmountable" not "unfair." Someone born with $1Bn today has an insurmountable advantage over a person born into poverty today, and it is likely (under most theories, but not all) that their grandchildren will be in a similar situation given the current (and growing) class divide. If you have not seen this first hand, think of it as a caste system that is unintended and unacknowledged.

The makers of Freicoin have not yet advocated replacement of all (or any) fiat currency with Freicoin, and I anticipate that this will be the case for some time. The reality is that there WILL be multiple currencies, some fiat, bitcoin, and maybe a few (or a ton) of other cryptocurrencies. Freicoin will need to coexist with other currencies and will not have an isolated existence. Given the low cost of converting to bitcoin or another crypto, the barrier between being able to afford multiple currency types will continue to drop, giving similar financial tools to the whole world, not just the wealthy.

Saving wealth for retirement is neither encouraged or discouraged by Freicoin in a multi-currency environment, there is no reason to assume that everyone who earns a wage in FRC (or sells goods, etc.) will only be paid a living wage in FRC. If they have more than they need for their daily needs then it can be loaned out as FRC (pay me back what I loaned you in 1 year, much easier for peer-to-peer lending), or converted into fiat or another cryptocurrency for value storage. The demurrage is not so steep that you need to convert your daily living expenses, except for spending reasons, but holding FRC instead of BTC is a foolish plan right now, and likely will be in the future as well.

In spite of their being called "the 99%" those in the movement make up FAR less than 99% of the planet, and even less than 99% of the unemployed. Globally is it NOT true that "most" folks are NOT working for a living. The vast majority of the global adult population is engaged in productive work for themselves, their families, their communities and their employment. It may not all be on-the-grid and exposed to the global banking system, but even the poorest of communities have internal trade in goods and services.

Demurrage may be similar to inflation at the math level, but it is very different at the physiological and social level as well as the lack of a political aspect like fiat has. Instead of having money in your pocket that buys less and less over time for the same amount, I have money in my pocket that is perishable and prices that are (in theory) stable. I also know how and when my money is declining in value, so I don;t have to worry about the government changing it. Inflation gives an illusion of personal control over money while removing actual control. Demurrage gives personal insecurity over future value of money and drives a personal decision point much earlier in the decision process. Put more simply "I can SEE demurrage happen, inflation sneaks up on you."

Please note, I'm NOT convinced that Freicoin will work in the long run, or that this economic theory is 100% correct, but honestly I don't know that it matters. All that will matter is adoption and user perception in the long run, miners should be minor

[Jutarul]

It's not like they are forced to work, either.   Last time I checked, workmen in factories are not tied to their workplace with iron chains on feet or something.  Oh, and they also happen to receive something that they are supposed to have agreed to receive in exchange of their work.  It's called "SALARY".

How did this develop into a discussion of economic fairness?

Freicoin is about a new feature of a currency. The developers have the opinion that is should be field tested now - so they have started it. There's nothing new about this coin from a technological point of view - innovation points are limited to coin distribution and the demurrage. Due to the lack of a proper monetary support system for the implementation of the required infrastructure an 80% tax on mining revenues for the first few years is acceptable.

It is debatable whether the properties of the currency is what determines economic fairness. I wouldn't know. Any real experiments done? E.g. an ESS analysis (http://en.wikipedia.org/wiki/Evolutionarily_stable_strategy)?

[grondilu]

It's not like they are forced to work, either.   Last time I checked, workmen in factories are not tied to their workplace with iron chains on feet or something.  Oh, and they also happen to receive something that they are supposed to have agreed to receive in exchange of their work.  It's called "SALARY".

How did this develop into a discussion of economic fairness?

Maybe because of the extensive (edit:  my bad, just one actually.  But still) use of the adjective "unfair" in the freicoin webpage?

[maaku]

Please remember that the word to use when talking about economic advantage is "insurmountable" not "unfair." Someone born with $1Bn today has an insurmountable advantage over a person born into poverty today, and it is likely (under most theories, but not all) that their grandchildren will be in a similar situation given the current (and growing) class divide. If you have not seen this first hand, think of it as a caste system that is unintended and unacknowledged.

I'll reword that sentence. The correct meaning we were striving for is “partially unfair,” but maybe “insurmountable” conveys it better. A communist says the money-holder has no claim to the return on his capital: that is not our belief. It's only the basic interest that we claim is usurious/unjust.

If the basic interest truly offered no unfair advantage, than around the world wasteful heirs would be squandering their inheritance, and entrepreneurs rising from rags to riches in a single lifetime. Yet that experience is rare except in places like Silicon Valley, where capital returns far exceed basic interest rates. In most of the world what is happening is social stratification and the entrenchment of an even more monied multi-generation elite. What we're proposing is monetary reform that would make the entrepreneur-friendly Silicon Valley experience much more normal.

[jtimon]

What does he mean by "deprived"?  And "their own means of production"?  Were these means of production their property in the first place? Have they been stolen?  If so, those workmen should ask for justice.  Theft is a crime even in anarcap-land.

No, I think he means that since less factories are built than what would be profitable without basic interest, they're being forced to compete for artificially scarce means of production. But, sorry, I can't be sure what he meant exactly.

Let me ask you.  Is it unfair that an unemployed workmen receiving his weekly unemployment subsidie from government?  Isn't that also a rent?   Why would such a rent be acceptable when the person who benefits it has done nothing to benefit it except gathering in flocks and use political threats and physical bullying in order to get it from force?

Well, yes, it is kind of a rent, but not exactly. In my country, Spain, I'm forced to pay an all-in-one health and unemployment insurance to a public company called "Social Security".
So I won't feel like I'm stealing anything when I receive unemployment subsidies if I ever do.
Of course, this goes against the free market and private companies could make this more efficiently. That's not what we're proposing here and we don't have force to use.

Yeah, having and using sound money is a good economic move and it does indeed provide an economic advantage other people using shitty money.   Yes, being smart pays.  I don't understand why you think this is unfair.

Actually most people pay far more interested priced in the products they consume through their lives than they get from their savings. Even most entrepreneurs and smart guys.
By accepting free money, you're making more investments profitable and you're getting lower prices for yourself. That's why I believe free-money will be competitive against capital-money on a free market.

You didn't quite get my point.  To me saving and exchanging are really the same process.  They just happen on different time scale.  So there really is only one function, it just that it is very elastic as far as time is concerned.

I disagree with your point. Saving and trading are different things. The financial market is not "just another market", it greatly influences all the other ones. Because it is very important for investment and real capital accumulation (which I think you'll agree is the root of prosperity).

There are way too many economic assumption I don't agree with in this reasoning.  I just can't debate it.  I disagree with pretty much every single sentence.

Let me try to summarize it on separate statements. All assuming a free market but for an enforced gold monetary monopoly.

1) nominal interest = real interest + inflation premium = basic interest + risk premium + inflation premium

2) Capital yields naturally tend downward through competition, just like other profits. While they're positive, there's unsatisfied demand for producing goods (real capital) and more could be invested with no loss.

3) Capital yields and the Basic interest/liquidity premium/time preference tend to be equal

4) The basic interest is always positive (obviously we disagree on why) and therefore capital yields can never be zero.

I don't understand why you keep talking about interest rates and capital yield when bitcoin is not about that at all.  Bitcoin is jjust a currency.  It does not say anything about credit and investments.

Apparently now you're saying that the structure of money doesn't have any influence on investments. This is not what I'm used to hear from austrians but, sorry, I don't think we can debate demurrage without talking about interest and yields. I have tried...

[Sunny King]

How is basic interest rate related to demurrage rate in Gesell's theory?

Assuming there is no competing currencies, what's the basic interest rate (a rough estimate would be okay) for:

1% annual demurrage rate
5% annual demurrage rate
10% annual demurrage rate
90% annual demurrage rate

Can anyone answer that? Then it would be easier for us to grasp the claim here.

[maaku]

The basic interest rate / liquidity premium is a natural feature of money unrelated to the artificially-imposed demurrage rate. Basic interest does not go up or down if demurrage parameters are adjusted. Gesell argued that demurrage should be equal to the basic interest rate, which at his time and now hovered around 5% (but like the undeveloped value of land, it's not something easy to measure). We chose 4.89% because the math was better (2**-20 per 10min block) and it stayed within the error bars of ~5%.

[meebs]

so hey guys....


has there EVER been another alt-coin that was so freaking controversial before?

This just seems to be pretty rediculous how much garbage and hate is being thrown around.

If you dont like how its ran.. than dont buy it or mine it.. ITS THAT SIMPLE.

[Impaler]

The basic interest rate / liquidity premium is a natural feature of money unrelated to the artificially-imposed demurrage rate. Basic interest does not go up or down if demurrage parameters are adjusted. Gesell argued that demurrage should be equal to the basic interest rate, which at his time and now hovered around 5% (but like the undeveloped value of land, it's not something easy to measure). We chose 4.89% because the math was better (2**-20 per 10min block) and it stayed within the error bars of ~5%.

I'm of a slightly different opinion on the stability of the liquidity premium, I think it fluctuates with the business cycle.  When times are good and most types of assets are rising in value and loanable funds are in abundance the premium goes down because money as a hedge is less useful.  In bad economic times when most real assets are falling or in danger of falling and the markets are gripped by 'flight to safety' the liquidity premium rises.  The higher premium drives down monetary velocity and compounds the economic downturn.  Gesell provides 5% as the 'historical average' but dose not claim that liquidity premium is invariant.

We have had considerable debates on this on the Freicoin forums and while I believe that adjustable rate of demurrage would be ideal in a theoretical sense, it was clear to everyone that such as system was too high a mountain to climb both technologically and in public acceptance so Gesell's fixed rates were used.

[maaku]

We're on a bit of a tangent here, but actually Gesell advocated variable interest rates set by a state mechanism (pricing of demurraged stamps affixed to paper bills). Our concern was that there's no decentralized mechanism for adjusting rates that is not subject to influence/attack. However compared to other indicators basic interest is incredibly stable.

[Sunny King]

The basic interest rate / liquidity premium is a natural feature of money unrelated to the artificially-imposed demurrage rate. Basic interest does not go up or down if demurrage parameters are adjusted. Gesell argued that demurrage should be equal to the basic interest rate, which at his time and now hovered around 5% (but like the undeveloped value of land, it's not something easy to measure). We chose 4.89% because the math was better (2**-20 per 10min block) and it stayed within the error bars of ~5%.

Really, 5% demurrage would have the same basic interest rate as 0% demurrage according to your understanding of the theory? Hmmm that's what I thought too, so finally we have something to agree upon 

[Jorgeminator]

[nethead]

aaaand its gone

[Ignore@YourPeril]

No initial coins, no pre-mining, no special addresses, no ownership of anything by anyone, no secret launch date. Cryptocoin with demurrage
and no bullshits attached. All generated coins and demurrage and later just demurrage go to those who are coin true foundation = miners. What
will miners do with their coins, will they hold them or invest, and what will they invest into if they chose to invest, is up to them to decide.

I wonder if a Freicoin fork is the sort of thing that the Freicoin Foundation would donate to?

I´ll give you 500 1000 FRC if you can have it ready in 4 weeks time. The Freicoin Foundation should support this (-yes, seriously); I recommend all early FRC adopters to support it. But the following changes has to be included, to make it even less of a copy-cat coin:

- The addresses will have to start with rather "b","f" or something: anything other than "1" (more stylish also)
- The demurrage has to start way higher than 5%, lets say 65% which is then reduced to 5% in 3 years (as a part of the initial distribution)
- The name bushcoin or obamaCoin is not acceptable, we need a serious, un-political sounding name. I can accept subCoin (for subSTRATA Coin).

[franky1]

nah friecoin is just a taxed coin.. everyone mining wants to call it a big thing so they can find suckers to buy it off them before they get taxed.

how about instead of promoting yet another alt coin to the 150k crypto community. you try promoting the existent coins which are lasting the test of time (litecoin and bitcoin) to the mainstream merchants.

[galambo]

How did this develop into a discussion of economic fairness?

One of the reasons is related to our mascot, the arctic tern.

The world most people are looking for and the world of the tern are nearly the same. A soaring bird, like the tern, is only seconds away from a collision with the ground. The bird must respect and obey the natural laws or suffer the worst consequences.  Yet, its able to use its brain to stay aloft for hours. In contrast, man's laws are regularly abused by corruption, intimidation, and celebrity. Punishment has become increasingly avoidable, especially in finance. Most people agree this is a net negative for humanity.

What maaku and jtimon have done is come up with a method for making the system of finance behave more naturally. This is very much in the interest of "fairness." Everything decays; so should our money.

Freicoin is a lot like flying through the air. You must either spend energy and flap your wings, or be smart and find rising air to soar if you want to stay up. To those who argue that 5% demurrage may be the wrong value -- gravity on the surface of the earth is a constant -- does that make flight and crashing impossible?

[creativex]

<unsubscribe> I can't take any more of this philosophical nonsense. I want my currency to be as effective a store of value as possiblePERIOD

I don't want or need it to attempt to shelter the poor, feed the hungry, punish tyrants, etc...

[Ignore@YourPeril]

I want my currency to be as effective a store of value as possiblePERIOD

And this is a very reasonable and commendable objective. You are however in a tiny minority of a tiny minority (those who are prudent enough to  think of saving-> subgroup those who have a grasp of cryptography and economics)

Most people are used to- and still want cheap an crazy credit money. And if they are surfing the web and can see the obvious benefit in decentralized money... FREICON FREICOIN (had to kep the misspelling after edit  )!

[psybits]

Personally I think it's a new idea, and therefore it's awesome!

Isn't that what we're all about here? 

Anyone, feel free to toss me some FRC I'm excited