A small city in Europe: What would happen if...
...you took 50000 casascius physical bitcoins and threw them all out of an airplane above the city?
I suspect since the cost was zero, any that were found would not be valued much. Being that these can be redeemed at Mt. Gox, the technical among them or those already familiar with Bitcoin would find that they could offer cash below the exchange value and either make online purchases from a merchant (by arranging to send the physical bitcoins in bulk even, hoard then or profit by exchanging these at an exchange even.
Most of the coins, however, would likely be lost as these are about the size of a quarter and a small city has lots of roofs, street gutters, gardens, etc.
Because they all won't be discovered at once and plenty of willing buyers remain so the value of these as money among the residents would likely soon match that found on the exchanges. Some will start using the coins to settle small payment amounts -- for example, used as payment to a friend who bought the beers or to give as a tip at a restaurant, for example. A few merchants might start accepting them -- maybe even gaining an advantage by being the first and putting on some promotion that brings new customers through the door.
Whether or not this approach would cause a tipping point to be reached where the coins become a currency who knows. It would be neat to see such an experiment play out.
My thoughts. Thanks.
Now for the 2 objections brought up:
1.) you might harm people and/or property: we'd have to run some experiments. The coins are not very thick, about 2mm, I would guess. They weigh about 6.7g. I doubt they could seriously harm a person, let alone kill one. Will it reach terminal velocity when dropped from 4th floor? I could make an experiment to see wether it damages a cars roof when dropped from that height.
2.) you will get sued: well, just to be safe, I'd do it anonymously, maybe using a microcopter or something to disperse the coins evenly. Any thoughts on this? One could also use a less cool method, maybe, of just driving around in a car and dropping them to the street.