The Future of Digital Currency?

[alby]

What is the future of Digital Currency?

Technically we already use a Digital Currency every day. There are more
US Dollars used in digital form than physical form. Something like 10 to 1.

Given that most online D.C.'s are backed by Gold, they are more a play on
Gold Investing than fueling an economy run on Gold. For instance, I can fill
up an online account with plenty of Gold, but where can I spend it? The vast
majority of merchants only accept US Dollars. So even if you've got a D.C.
account with an ATM card, the whole transaction taking place when you
purchase that new pair of shoes is nothing more than Gold being sold for
dollars to give to the vendor. You aren't really paying the vendor with gold.

I would argue that until there is a wide spread acceptance of merchants
willing to accept Gold (as well as Dollars) as payment for Goods and Services,
the future of Digital Currencies backed by Gold, Silver, etc is useless.

Now I don't say this because I'm out to poo-poo D.C.'s. In fact, I wish
we would do away with the USD and go back to Gold Coins. But from a
practical sense, the future looks bleak.

[Iptuous]

perhaps as an intermediary step, the DC companies could issue debit cards that can pay out in $?
then card reader vendors could be eventually be pressed to make readers that give the option of paying directly with Au if the retailers are willing to price in them....
i agree with your sentiment, though. the only way it could be used as a medium of exchange as it stands is if person-to-person transactions became a significant part of commerce....

[mozkill]

A gold standard of money is not necessary, especially since no other countries would cooperate and play the same game. Fiat money is far more feral and gold standards wont hold up to it. I'd think of a different idea.

[jetgraphics]

"They" desperately want us to consent to electronic money, because the sum of funny munny is not sufficient. Worse, the FRNs cannot pay the national debt (denominated in real dollars).

BTW - Federal Reserve notes are NOT FIAT.

Fiat currency has value because the government says so.

The constitution does not delegate the power to create money to Congress.
Congress can coin money (stamp bullion) or borrow money, on the credit of the U.S.
If Congress had the power to create money, it wouldn't need the power to borrow it.

FRNs are not money, by law. They are notes (debt). Pursuant to Title 12 USC Sec. 411, they are promises to pay dollars - in the future. But that promise was repudiated in 1933. Therefore FRNs are worthless securities (no par value). They act as current monies because of the 300 million 'human resources' who are pledged as collateral on the public debt ( in excess of ten trillion dollars).

Since 1933, there have been no real dollars in circulation. Since 1965, there haven't been lawful fractional coinage, either. But "They" have succeeded in persuading millions and billions of people to presume that a worthless IOU is the same as a dollar.

"D'oh!"