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# The Decentral Bank

One question is left for a decentralized monetary system: can you replace the
central authority that creates and annihilates money according to the actual
needs to keep it circling, with a decentralized system?

Central banks give money to banks, in form of credits.  Banks give that money
to their customers, in form of credits.  The idea behind that is that in order
to produce goods that are finally consumed, you need to invest up-front, buy
the incredients, spent money on the work, and finally, when the good is sold
to the consumer, you can pay back your credit, and share your profit with the
creditor (the interest rate).  The central bank doesn't quite need you to
share the profit with them, so their interest rate is more a control
instrument than a profit tool; they can also issue money with negative
interest rates.

So in fact, the system is already somewhat decentralized: The central bank
outsources the job to evaluate the actual credibility to banks.  This gives a
lot of power into their hand, and it favors big credits over small credits
(there, the effort for verifying the credibility is small compared to the
overall profit).  Even further: Since the banks have their own need for money
(their Ponzi-scheme department, also called „investment bankers“), they prefer
to give the central bank's money to that department, and it creates stock
bubbles, real estate bubbles, or even BitCoin bubbles.  Real funding of
promising businesses doesn't happen.

So this sort of funding doesn't work that well for the internet age, which is
why crowdfunding has been invented.  The idea here is that many people give
small credits, and really receive the mass-produced good when it's actually
produced (so unlike futures, the contract itself is not tradeable).  The
missing point is that the central bank doesn't step in and gives the
crowdfunder credits, so that they could crowd-fund with a lever.

And so that's the decentral bank: It's a crowdfunding system, where people
have to sign for the risk of the fund, but not for the actual money — they get
a credit for that, and only part of the money paid upfront has to be their
own.  Once the project is finished, they have to pay the full amount to
actually get the product they ordered, but that way, the money needed for
circling between funding and production can be created as fiat money.

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