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Author Topic: The Fall of Fiat: Could Community Currencies Be The Future of Money?  (Read 82 times)
MrsBlockchain
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September 15, 2018, 02:44:22 AM
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I have been casually studying Austrian economics for the past 6 years and I came to the conclusion many years ago we need a system, instead of using government and central banked pieces of paper we should all create our own community currencies to be trade peer-to-peer without intermediaries. I came across the very interesting article today on Steemit. It will be great to get feedback on it:
https://steemit.com/cryptocurrency/@tinyearth/the-rise-of-crypto-could-community-currencies-be-the-future-of-money
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September 15, 2018, 07:48:01 AM
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I like the direction OP is heading.  Smiley

Small communities and countries adopting their own crypto currency is an ongoing thing dating back to at least 2014(if I'm remembering right). Iceland unleashed its auroracoin crypto currency around that time.

https://en.wikipedia.org/wiki/Auroracoin

Around the same time auroracoin was unleashed around 2014, I remember reading a news story about native american communities

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Native American tribes adopt Bitcoin-like currency, prepare to battle US government

MazaCoin could be what the Lakota people need to boost them out of longstanding poverty, but is it legal?

The programmer and Native American activist Payu Harris raised a gavel Monday night and vigorously banged the bell to open trading at The Bitcoin Center, a meeting space for virtual currency geeks that looks like an empty art gallery in the middle of New York’s Financial District.

Harris was there to promote MazaCoin, a cousin of Bitcoin that is now the official currency of the seven bands that make up the Lakota nation. After an hour of questions, Harris thanked the small crowd and was promptly accosted by a tall man and a woman in red who wanted to buy some MazaCoin, which Harris was selling for 10 cents apiece. The two trailed him around the room as he hunted for a printer so he could issue the digital currency on paper. MazaCoin is a month-old cryptocurrency based on the same proof-of-work algorithm as Bitcoin, the virtual currency that approximates cash on the internet — but no one in the room was equipped to make a digital trade.

There have been a slew of copycats since the rise of Bitcoin in 2009. The first wave attempted to improve on the basic Bitcoin protocol. The second wave, which includes the meme-based Dogecoin and the Icelandic Auroracoin, are catering to specific groups.

MazaCoin was developed by an anonymous cryptographer who had built a new implementation of the Bitcoin protocol and was looking for a good cause to associate it with, Harris says. Anyone can buy or sell the currency, but the Lakota are keeping half of it in reserve in order to prevent the wild speculation that has caused Bitcoin such price volatility. Harris has also had inquiries from other tribes that want to use the currency or start their own.

Currencies knit communities together. Having one’s own currency is empowering; the Latvian 5-lat coin, nicknamed "Milda" for the woman in traditional clothing depicted on it, became a symbol of Latvian independence during the Soviet occupation. A dedicated currency also boosts economic activity within a community, the impetus behind the (questionably legal) hyperlocal currency movement that has produced alternative monies such as BerkShares, IthacaHours, and the Brooklyn Torch.

Tribes using MazaCoin automatically make it easier to spend money at the local reservation general store than changing it into dollars to spend at Walmart, for example. But perhaps more than that, it will give the Lakota people a sense of unity and independence. "Our tribe has an idea of what sovereignty is, but not at a level like the Ukrainians," Harris says, referring to the fierce battle for democracy taking place there. "There is no sense of national identity."

That fragmentation contributes to the tribes’ crippling dependency on the US government. Half the tribal members on Harris’s reservation, the Oglala Lakota Pine Ridge Indian Reservation in South Dakota, live in poverty. It’s a problem that afflicts tribes across the country as Native Americans have grown dependent on federal welfare after being ghettoized on reservations.

Roughly $220 million flows through the reservation every year, through the Prairie Wind casino and other venues, according to Harris. But he estimates less than $45 million of that stays in the local economy. With MazaCoin, he hopes to stop that money from flowing back to Rapid City and out of the state. "We’re building a new economic foundation for the reservation," he says.

The US Treasury Department has indicated that Bitcoin is legal but carries certain bookkeeping requirements related to money transmission. At the same time, some politicians are calling for a ban on the currency. Harris is hoping to avoid all that with MazaCoin. Federal laws granting Native Americans special legal status provide an argument for a currency totally independent of the US dollar. Native American sovereignty is legally defined over a patchwork of treaties, laws, and precedent. "We're on sovereign soil so we have the right to have Bitcoin, Litecoin, MazaCoin," Harris says.

But Chase Iron Eyes, South Dakota legal counsel for the Lakota, believes the federal government will push back if MazaCoin succeeds. "There hasn’t been a tribal nation that has declared its own currency and has mandated that that currency is used within its borders," Iron Eyes says. "But it’s because of this pervasive, ever-present asserted dominion of the United States. They’ll try to shut us down, try to cite us with law violations."

While the leadership of the Lakota nation has signed off on adopting MazaCoin as a national currency, there is resistance within the ranks. Digital currencies are not always an easy sell, especially to older generations who are not accustomed to using apps constantly throughout the day. A further complication is that not all tribal members have internet access or smartphones, which means Harris has to develop a paper wallet system where members’ MazaCoins are held in cold storage at a central location like a bank. In theory members can walk into the bank, get their MazaCoins in a paper wallet that can be processed by reservation businesses, then return the balance to digital storage at the bank before driving home.

There is also a fear of letting go of the US dollar, which holds the implicit threat of letting go of the federal subsidies denominated in it. Iron Eyes believes the legal battle and the public perception battle are worth fighting. "We’ve gone through 100 years of imposed poverty. That’s the fight we’re having," he says. "What we’re trying to do with MazaCoin is just spark something to get us out of this cycle of victimhood."

https://www.theverge.com/2014/3/5/5469510/native-americans-assert-their-independence-through-cryptocurrency-mazacoin

I haven't seen updates for mazacoin since 2014. It is possible it is still actively in use.

Many still demand socialism despite it perhaps not being the best of systems. I hope if these small community based efforts at creating crypto currencies fail people won't be too deterred. Perhaps some were a little ahead of their time. Unveiled before the public was ready to accept them. New trends such as consuming fruit to deter scurvy can take decades to manifest. And so if some of these early attempts result in failure, we shouldn't be too discouraged by them.

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September 16, 2018, 09:17:48 PM
 #3

I have been casually studying Austrian economics for the past 6 years and I came to the conclusion many years ago we need a system, instead of using government and central banked pieces of paper we should all create our own community currencies to be trade peer-to-peer without intermediaries. I came across the very interesting article today on Steemit. It will be great to get feedback on it:
https://steemit.com/cryptocurrency/@tinyearth/the-rise-of-crypto-could-community-currencies-be-the-future-of-money

What are your thoughts on bitcoin, and other 'global' cryptocurrencies?

They're also decentralised and not associated/affiliated with fiat currencies issued by governments, but obviously they operate at a larger scale than the localised, community based currencies that you seem to be interested in.

To me, these global decentralised cryptocurrencies are the most interesting compared to community issued ones as they could facilitate international transactions with a unified currency like never before - saving on efficiency, cost, while being a global store of value. I'd be interested to hear your take on the benefits of community currencies compared to bitcoin. I mean, individual communities can still adopt BTC and benefit from it, and potentially enjoy more stability in the long run in their currency of choice.
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September 16, 2018, 10:32:47 PM
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To me, these global decentralised cryptocurrencies are the most interesting compared to community issued ones as they could facilitate international transactions with a unified currency like never before - saving on efficiency, cost, while being a global store of value. I'd be interested to hear your take on the benefits of community currencies compared to bitcoin. I mean, individual communities can still adopt BTC and benefit from it, and potentially enjoy more stability in the long run in their currency of choice.
The problem with crypto currencies isn't really how useful they can be, but more so their volatile nature. I honestly don't think crypto is a good form of payment, regardless of how fast or convenient they are.

Yes, you could say that crypto in general increases in value throughout the years, but people need a stable value currency day in day out, and not somewhere in the next couple of years. I wish it was different, but it isn't.

I think it's better that communities have their own stable crypto currency issued that at all times has an 'agreed' value of $1 per unit. It won't solve centralization completely, but everything is better than fiat currencies.

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September 16, 2018, 10:59:46 PM
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I was surprised in the article that Kenya has long been using blockchain money technology. This is indeed a very interesting trend. Why print money if you can put your national currency in the blockchain, and the shares of each coin to transfer to each other for goods.
The only question is that who will benefit the state? bankers?
For this reason, many countries are in no hurry to change their economy. It is not profitable for them to create a decentralized national coin on the blockchain until there is a default in the country. The Example Of Venezuela
figmentofmyass
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September 16, 2018, 11:01:56 PM
Merited by Hydrogen (1)
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I like the direction OP is heading.  Smiley

Small communities and countries adopting their own crypto currency is an ongoing thing dating back to at least 2014(if I'm remembering right). Iceland unleashed its auroracoin crypto currency around that time.

https://en.wikipedia.org/wiki/Auroracoin

Around the same time auroracoin was unleashed around 2014, I remember reading a news story about native american communities

Quote
Native American tribes adopt Bitcoin-like currency, prepare to battle US government

MazaCoin could be what the Lakota people need to boost them out of longstanding poverty, but is it legal?

I haven't seen updates for mazacoin since 2014. It is possible it is still actively in use.

Many still demand socialism despite it perhaps not being the best of systems. I hope if these small community based efforts at creating crypto currencies fail people won't be too deterred. Perhaps some were a little ahead of their time. Unveiled before the public was ready to accept them. New trends such as consuming fruit to deter scurvy can take decades to manifest. And so if some of these early attempts result in failure, we shouldn't be too discouraged by them.

mazacoin is still around but interest/awareness dropped a lot when it got delisted from bittrex last year. the network is still active and it's consistently listed as one of the most profitable sha-256 altcoins. unfortunately, daily volume is low. i like the lead developer @guruvan and the idea behind it, and i'm hoping it has a resurgence. it's still trading on cryptopia.

i agree, we shouldn't be surprised if these first attempts fail. getting the network bootstrapped and coins fairly distributed (and used) is no easy feat.

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September 16, 2018, 11:02:23 PM
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Cryptocurrencies are the future for sure, it is only a matter of time for fiats to lose it's dominance, cryptocurrencies are more efficient and economical
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September 17, 2018, 12:47:10 AM
 #8

I have been casually studying Austrian economics for the past 6 years and I came to the conclusion many years ago we need a system, instead of using government and central banked pieces of paper we should all create our own community currencies to be trade peer-to-peer without intermediaries. I came across the very interesting article today on Steemit. It will be great to get feedback on it:
https://steemit.com/cryptocurrency/@tinyearth/the-rise-of-crypto-could-community-currencies-be-the-future-of-money

The creation of everyone's own crypto will not lead to good results. This will result to the creation of unnecessary tokens and will lead to bad ideas about crypto. Only the more powerful will remain standing, and again the money will be gathered in the hands of the more powerful. This will cause people to live in a much lower condition.
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September 17, 2018, 01:52:19 AM
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If granted that cryptocurrency technology will be accepted by every nation and state ,then community currencies might be the future of money and fiat money will becoming slowly falling in the country but it will not totally be wipe out or phase out in the real world market.
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