Monday, December 2, 2013

Fed Up With Bitcoin? Here's How To Start Your Own Currency

Back in analog eras, even the most powerful people had a tough time starting their own currency. It would have taken a fair bit of wealth to begin with, because most legal tenders were tied to something real, like gold or silver. Even if you had amassed enough treasure to back up your new scrip and decided how the currency would be denominated, it would be an uphill struggle to convince everyone your funny money was worth something.

In the digital age, and especially with Bitcoin, we’ve long since done away with the need for a gold standard. Money and new currencies are entirely manufacturable. Backers of a new “programmable money layer” called Mastercoin claim their system will allow anyone to devise their own currency by using the preexisting Bitcoin economy as a foundation. It will allow anyone in the world to exchange their Bitcoin for Mastercoin, which can then be traded again for user-generated currencies.

At the moment it’s a complex, even barmy, idea which is made doubly confusing by the fact the word Mastercoin not only describes a currency, but a protocol. Yet if it works, within the next few months anyone with a passing knowledge of the digital economy could start up their very own currency which could serve a variety of purposes. Perhaps you want to track the price of gold or produce a currency that can only be traded for a certain commodity or service. The Mastercoin developers want to help you do that.

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