Skip to main content

POST Strong and stable

xxx

Circle noted that USDC is built on openness and accountability, with commercial issuers required to be licensed to handle electronic money, to have audited AML and compliance programs, to back all tokens on a fully reserved basis and to provide monthly published proof of reserves, to support fungible exchange and redemption of USDC tokens from other authorized issuer members, and to meet other reporting and review requirements established by CENTRE.

From Circle Rolls Out USD Coin | PYMNTS.com.

More like Mondex than Bitcoin, frankly.

So what is a “stablecoin” anyway? If it is meant to be a coin that maintains purchasing power over time then why would you back it with US dollars, which do not? If it is meant to be a coin that 

 

Well, this was first tried donkey’s years’ ago when Digicash launched. The idea of of a crypto coin that represented a dollar, a euro, a pound or whatever. This

 

There’s a difference between a currency and a currency board. A currency board issues a currency (let’s say Zimbabwean Dollars) that is backed by a 100% reserve in another currency (let’s say South African Rand). So, for example, if I issued DaveCoin and each DaveCoin 

Now, if that sounds pointless - why would you use DaveDollars when you could use USDollars? - you have to remember that lots of people do this already. When I give Safaricom at Kenyan Shilling, they in turn give me an M-PESA Kenyan Shilling which is more useful to me because I can send it to someone else using my mobile phone. All of the Kenyan Shillings that are in the form of M-PESA account balances are backed one-for-one by Kenyan Shillings in Safaricom’s bank account.

Under European electronic money laws, this is how things should work. If I give you an e-Euro, I ,must have an actual Euro in “tier 1” capital. The point of this is that 

Comments

Post a Comment

Popular posts from this blog

There is no excuse for not taking cards

So we went to the pub. For lunch. Seven of us. Say £20 per head. £100+ quid. Say £50 quid gross for the pub. Colleague goes to order food and drinks and pay at the bar. Apologetic barmaid comes over to explain that their “card machine” is down, so she can only accept cash. Under normal circumstances I would have simply walked out, feeling it wholly inappropriate to reward such a poorly managed establishment and, as a functioning actor in a capitalist economy, done my duty to depress their lunchtime takings. Here’s what we wanted to say: This is absurd. This is 2016 not 1916. Your card machine is down? Well, so what! Are you seriously telling me that mein host has no mobile phone number capable of registering for PingIt or PayM? That none of the staff or the pub itself have a PayPal account that I can send the money to? That neither the owners nor managers not contingency planners thought to tuck an iZettle behind the bar to use when the clunky and expensive GPRS terminal fails for o...
Post a Comment
Read more

Financial Cryptography: Corda Day - a new force

Forum friend Ian Grigg, who I always take very seriously indeed on any such topic, wrote about Corda on his blog and concluded with a powerful statement. Bitcoin told the users it wanted an unstoppable currency - sure, works for a small group but not for the mass market. Ethereum told their users they need an unstoppable machine - which worked how spectacularly with the DAO? Not. What. We. Wanted. Corda is the only game in town because it's the only one that asked the users. It's that simple. From Financial Cryptography: Corda Day - a new force xxx It seems to me, however, what Ian is pointing to as the greatest strength of their approach is also the greatest weakness. A staple feature of unimaginative management consultants presentations about innovation is some variation on the statement by Henry Ford that if you had asked users what they wanted, they would have asked for faster horses coupled with some variation on the statement by Steve jobs that it was pointless ask...
Post a Comment
Read more

We could fix mobile security, you know. We don't, but we could

Earlier in the week I blogged about mobile banking security , and I said that in design terms it is best to assume that the internet is in the hands of your enemies. In case you think I was exaggerating… The thieves also provided “free” wireless connections in public places to secretly mine users’ personal information. From Gone in minutes: Chinese cybertheft gangs mine smartphones for bank card data | South China Morning Post Personally, I always use an SSL VPN when connected by wifi (even at home!) but I doubt that most people would ever go to this trouble or take the time to configure a VPN and such like. Anyway, the point is that the internet isn’t secure. And actually SMS isn’t much better, which is why it shouldn’t really be used for securing anything as important as home banking. The report also described how gangs stole mobile security codes – which banks automatically send to card holders’ registered mobile phones to verify online transactions – by using either a Trojan...
Post a Comment
Read more