Topic: What if the US creates a competing currency? (Read 5475 times)

The government can't do that, but the Congress. Look how the banking cartel got the Federal Reserve Act in place and then think how realistic it is for the US-government to drop the Dollar and use something else.

I agree, the thread title is bit misleading. I never mentioned that the government should do it. It would be the private banking cartel aka Federal Reserve System creating and maintaining it. They only need to make the Congress to enhance the Federal Reserve Act for including Dollarcoins as legal tender. It will be very tempting for governments, since they can control the flow of a electronic cash equivalent in real time.

A private enterprise is addicted to profits. If they can reduce cost, then why they would not do it? Think of the many branches they can downsize, less security, abolish ATMs, abolish card readers, plastic cards aso. by using a much more efficient technology and finally lay off a lot of people in the financial industry.

Of course it will be a centralized system and never as efficient as a decentralized system. On the other hand they get the technology for free, they can force people using it (in the end you have to pay taxes in Dollars) and (sadly) a majority trusts government anyway.

Absolutely...not. Why would you trust a government with this control? And do you actually think any government is capable of making a currency like bitcoin? No.

On the other hand a Dollarcoin would be a big boost for alternate crypto currencies, since you can implement decentralized exchanges, because an electronic version of the "$$$" would be on par technologically. The exchanges would not need banks anymore, you could swap "$$$" for bitcoin p2p over the net. This is an implication I had in mind, and that would make the banking cartel to hesitate to introduce something like a Dollarcoin.

We already have one, it is called BTC

The Govt "uses" the Federal-Reserve... It Govt "is not" the Federal-Reserve... (Endorsement is not ownership. I think that is clear by the actions of the "bitcoin foundation", on Gox, and lack of actions on others.)

The Govt can drop the use of the Federal-Reserve, and use Euro or Yuan or BTC if it wanted to, and make that the only "legal tender".

Of course, the Dollarcoin would not be a store of value, like paper notes are not a store of value, but the payment utility would be the same if not even better, because the consumers are used to Dollars.
 

I recently posted an idea about P2P exchanges (wrongly thinking I had thought up the idea first  ), and the big question was how to link the $$$ to a decentralized exchange.

The more I think about it, the only real way would be to have $$$ in a digital wallet, just like a crypto currency. This would necessitate the $$$ having it's own blockchain, among other things, just like BTC.

The thing is, I do not really see the banksters going for the idea...

If people didn't use it and knew it would end up the same way the usd is going right now no one would use it they would just make more coins and then kill the value of it.

lol...Well the government did innovate in the healthcare industry...whats that WEBSITE again? FAIL!!!

Indeed, it would just like an electronic version of US dollar, but they would close the technological gap to bitcoin, the Dollar system would become more efficient.

The only way they would do this is if they could regulate it which defeats the object anyway because it would just be like usd.

Wait you think the US government is in control of the USD anyways?  Have you heard of the Federal Reserve?  Yea, they aren't a part of the government.

I know, I am a little bit late but I was thinking of such an idea too recently.

What if the Federal Reserve System issues Dollarcoins instead of paper Dollars?

The FRBs maintains a blockchain and the hardware. Each block is signed off ("hashed") by (a) secret key(s), so only the FRBs can add blocks and users can verify the authenticity of the blocks via the FRBs public key(s). Compromising the secret keys is a security issue, but this is a technical detail (for sure there will be bulletproof solutions).  

1) The Dollarcoins will be substitutes of Dollar paper notes, Dollarcoins will become legal tender:
- for each worn paper note turned in to a FRB a Dollarcoin will be issued to the blockchain (it would not change the amount of currency in circulation)
- for collateral a private bank deposits with its FRB, the FRB will issue Dollarcoins to its blockchain instead of paper notes and lend it to the private banks (it would increase the currency in circulation in the same way as new Dollar paper notes are issued nowadays)
- there will be still the desired inflation on the Dollar

2) Private parties, banks, payment processors, governments, foreigners can transfer each other Dollarcoins:
- you can make bank deposits and withdrawals
- pay or accept payments for goods and services
- pay taxes or get a return from the IRS

3) Why would we still need banks?
- banks pay interest for deposited Dollarcoins [that's why inflation is "needed"]
- they provide loan, investment and other services

4) Benefits for the existing banking cartel
- replacing outdated, insecure, inefficient electronic payment systems (credit cards, debit cards, cheques, bank wires aso)
- bank runs are very short lived, since they can be handled electronically and the FRB can provide Dollarcoins in minutes
- they keep the status quo

5) Benefits for the government
- they can track each Dollarcoin and prosecuting money laundering, tax evasion, illegal use aso. much more  efficiently (finally ban paper notes)
- they get a more "stable" monetary system

FTFY, but I agree anyway.

It would certainly make it easier to deposit in Mt. Gox.
 

I've seen this idea before, but I'm not clear why VAT is the exception. What about land value taxes and pollution taxes? Even a VAT could be evaded to some extent, depending on how far up the supply chain Bitcoin goes. Could someone elaborate?

Except that it's a good way to have a secure electronic currency.  But I suppose you're right - they'd probably just want to come up with their own things that is "bigger and better" than bitcoin in whatever ways they try to convince us it is...

Mmmm, you're completely right.  I do keep forgetting about the rest of the world.  Bitcoin can survive with or without the US.  I guess I am thinking so US-centric because of the current state of our economy, and my constant fear of not having enough money to put food on the table.

The subject and the initial post are so full of the innate American arrogance, egotism and self-centeredness, that it looks like Astroturf to me.  As in previous such threads, the premise seems to be that if the US bans, doesn't completely accept something, or competes against it, it's doomed to failure and obscurity...

So, i'll just restate the reality of this century, rather than the last one:

The US population is 4% of the world population.
It makes ~27% of the world GDP, last i looked.
It's broke and in debt for the foreseeable future. The numbers are staggering!
Even its own government commissions predict that it will face a fiscal and currency collapse within this decade, if not 2-5 years.
Its government isn't ready to do anything except bicker about it.

Yet, even in this forum, the arrogant, pathological, astroturfy American FUD continues to flow, regarding how anything Americans or the US government doesn't embrace is DOA...    Maybe it's just a ploy to push the B price down a little to load up... 

If they are going to make it so a central authority can increase and decrease the money supply at will, there isn't much point to starting with the Bitcoin code, or being related to Bitcoin at all.

Well, I know that there are other forces at work.  But if the government hopes to keep people using the dollar, then the dollar has to become at least somewhat competitive.  Maybe I'm wrong, but it seems that if something like bitcoin becomes popular because of skipping out on the middleman, then the government would need to create something similar for the dollar to skip out on the middleman, or no one is going to use it.  That is, unless they just straight-out outlaw bitcoins, which is a possibility as well.