With our asset exchange would it be possible to issue an asset like a "buck". Where for each buck, the issure holds 1 USD. I know that a fiat gateway has some very serious limitations, but if the issuer only holds USD (and someone even verifies that) and it is not really possible to redeem those "bucks", then this would be a nice way of introducing a shorting instrument. The price of 1 buck would be always near 1 real dollar because of arbitrage.
Possible?
I dont think we can setup shorting directly by using an issued asset. A negative value asset would mean that you would be forced to payup when you redeem it, but as the holder of such an asset, I doubt many people would ever redeem it, so there would be a lack of liquidity.
What can be done is to implement something like XCP does with bets to create CFD (contract for difference). This then allows creation of options (call and put) and can then be used to create all sorts of different risk/rewards based on possible price fluctuations.
A put option is close to shorting, there is just the matter of the option premium
It is also possible to directly issue a call option, or put option, or I guess a negative USD Asset, but this opens the whole collateralization issue to ensure that the issuer will be able to pay, regardless of the market fluctuations. Anybody issuing USD puts sold before the coming collapse this summer, will most likely not be able to payup any uncollateralized options
Rather than engineering these derivatives, I think it is much more productive to think about issuing Assets that represent real things, like turtles, eggs, pigs and even cows or a timeshare week on POPPP's farm in France.
In the next year or two, what happened in Greece and Iceland will look like a small blip. USA cannot keep spending money like it is without a severe devaluation or hyperinflation or both, but either will make all the other countries refuse dollars and force USA to pay in something a lot more solid, like CNY or gold, etc. Whether this happens this summer when new capital flight control regulations are enacted, or if it is magically delayed by a year, it will happen. Russia and China are already negotiating with their trading partners to avoid using USD as reserve currency. Being the reserve currency (what international trade is settled in) has given USA about a 40% advantage. Also it is the only country that can change a number in a spreadsheet and voila! all the goods it needs just got paid for. Fiat, gotta love it or hate it.
Such financial collapse will create a massive flight into precious metals, commodities but people will still need to trade and what will they use as money? Gee, I wonder what could be used for money in a post-USD world?
James
P.S. By making it easy to issue real world backed assets within AE, NXT will become the reserve currency. We see BTC acting as this against cryptos, but the potential for NXT is a lot more
