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What are the Ciudada Citizen Currencies? Is Bitcoin Really That Different?

June 11, 2020

Bitcoin users (the Bitcoiners) feel like they have fallen into the white rabbit hole and entered the wonderland. It is an extremely strange phenomenon. Suddenly we are Neo and decided on the red pill. And now we’re out of the matrix. Now everything is different and our view of reality is radically different. The problem is that the matrix is ​​a very difficult concept to explain to people who have not yet emerged from it. Explaining other Bitcoin is confused. It’s like driving. It is easy for those with experience, but for the novice, it takes practice. There is enough anecdotal evidence to show that a person needs many hours of study to understand Bitcoin. Grandmas, for example, have problems with the concept. Is it really such a complex and new concept?

When we go to a football game, it is not uncommon for us to buy tickets at the box office and then exchange them for drinks. The same thing happens in casinos. The use of tokens is not uncommon in these facilities. There are also gift cards. The famous gift cards. And we all remember the school fairs. I really don’t know if this activity is done everywhere, but it is in my childhood school. Every student had a table. At his table, he could sell used items, cakes, sweets, or any type of food, whether homemade or not. Of course, games could also be organized. The participants bought tickets at a location specially selected for this event and then the fun began. The funds raised are typically used for charity or, in some cases, to organize a graduation ceremony or special event.

Read on: Why weren’t cryptocurrencies successful as a form of payment?

What are the Ciudada Citizen Currencies? Is Bitcoin Really That Different?What are the Ciudada Citizen Currencies? Is Bitcoin Really That Different?

Many companies also give loyalty rewards to their customers. Usually the price is in the form of a voucher. We may be talking about money, a discount, or a service. Air miles are an example. These instruments have no intrinsic value. They are only a means of exchange. I mean coins. Some are spent by private companies like casino chips, gift cards or miles. But others are of a bourgeois nature, such as tickets for a school fair or a farmers fair. They are not the legal tender. You are not a Fiat. They are not issued by a central bank. They are alternative, complementary, private, social or citizen currencies. An extremely old practice. Indeed, much older than central banks.

Today, these tools are usually used to strengthen the local economy. Use localized payments and make them easier. One ticket, one beer on site. Easy. One ticket, one kilo of vegetables at the fair this Sunday. Municipalities around the world use these currencies to optimize resources. A lot of effort is wasted with the Fiat system. With these citizen currencies, however, it is possible to increase the value within the communities. For example, there are systems that reward a housewife’s time. Local spending is encouraged because the currency circulates within a certain radius. So there is no flight of capital. That means what is produced there stays there.

It is rare to see such a currency on a large scale because governments are restricting it. And it’s not really a conspiracy. That makes sense. And we should probably go down in history to get answers. Some of us have seen documentaries about a gang of rogue bankers establishing the US Federal Reserve on Jekyll Island. The Federal Reserve System, inspired by the Bank of England, was created on December 23, 1913 by the Federal Reserve Act. Since then, central bank economies have become the normto.

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Despite their popularity, the central banks have been criticized by some economists. Milton Friedman, founder of the Chicago School of Economics, and Friedrick Hayek, representative of the Austrian School of Economics, believed that central banks were the source of all evil and supported their abolition. Libertarians love Friedman and Hayek. And many libertarians have accepted Bitcoin. All of these goals come together. The Jekyll Island conspiracy. Central banks are the malicious creation of profit-oriented bankers. In fact, we don’t need them. They are also the source of all the evils in our economy. In other words, it seems that central banks were created out of pure evil.

What conspiracy theories and documentaries about meetings on Jekyll Island do not count before the central banks implemented them. If we listen to critics for a moment, we are tempted to believe that the world is a paradise. Gold was used as the currency and due to its scarcity there was no inflation. Everything went wonderfully. Reactive economists want to return to this lost paradise. The utopia of a distant past.

Now I fear that the creation of central banks arose out of necessity, because what existed before was utter chaos. Of course, I’m not defending anything or anyone here. Obviously, things are not perfect. But it seems to me that the creation of the central banks was not an absurd mood or the product of absolute evil. The world was in chaos and some kind of control and order was required. And time has shown that central banks have been a step forward. Not a perfect solution. Just a preview. You have to study the past to see it.

What exactly was there before? Well, no company had a monopoly on money. For example. In the United States, from 1837 to 1862, an era known as “free banking” came to an end. There were thousands of coins. Banks, regional governments, municipalities, private companies, businesses, churches, municipalities and individuals issued their own coins. The problem here was, of course, fraud, limited acceptance, fragmentation, poor interoperability and early or eventual project failure. Sounds familiar? Well, the era of “free banking” was an extreme experiment, but you could say that the economy was operating in monetary chaos before the creation of central banks due to the abundance of options and little regulation. Central banks came to put things in order. And the idea worked.

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Is Bitcoin a Citizen’s Currency? Yes I think so. The average Bitcoiner declares Bitcoin to be something extremely complex and innovative. And without a doubt Blockchain technology is very innovative, but basically, Bitcoin is another citizen currency. For example, the REC project in Barcelona, ​​Spain, is a citizen currency that uses blockchain technology and was created to channel resources into the local real economy. What is sometimes called a social currency.

Of course, most of these civic or social currencies don’t connect much with the cryptocurrency world and avoid comparisons. Why? Good, Politics is an element. His mind is different. And its purposes. Traditional citizen currencies aim to strengthen the real economy of a place or group and stimulate localized spending. There are coins that expire even after a while. Which means they cannot be hoarded. We are looking for a fairer medium of exchange. In these economies, wealth comes from real production. These practices are common among left-wing activists.

Bitcoin is the techno / anarcho / capitalist version of a traditional citizen currency. In this sense, it is the opposite of a social currency. Because Bitcoin prefers accumulation and speculation. It produces millionaires and is not just a popular and sophisticated form of barter. Personally, I see no problem with that. In fact, I think it’s great. I love bitcoin. However, the Bitcoin narrative is often heard as the currency of the non-banks. A decentralized means of payment for people and for people. We know the eternal debate within the crypto community well: Is Bitcoin a digital gold or a form of payment? The question: If it is a social currency style currency, why does the code stimulate hoarding? I leave it there and slowly withdraw.