With the Souvereign (SOV) plan the Marshall Islands as the first country in the world to introduce a cryptocurrency as the official currency. The Marshall Islands are thus following Venezuela, which is issuing an oil-covered currency with the Pedro. Turkey and Iran are also in the starting blocks, according to reports. Will the ICO be the new tool that states use to fill their coffers? And does that mean that the crypto-revolution has now arrived at the level of nation-states?
The biggest problems of an ICO are usually not in the technology, but in the marketing: How do you manage to build up so much trust that people give a FIAT currencies for tokens, which are virtually made from the air, and virtually in all cases come with a best windy and vague promises of return?
The problem is likely to be familiar to anyone who has ever dealt with state money production. Again, money is created from the air, and the market is required to trust the state enough to trade real goods for the worthless bills. Unlike the makers of the ICOs, however, the state has the advantage of having a history that is decades or even centuries old, armed forces, and economic resources. A state brings with it enough to get a trust, which is usually sufficient to give a value to the money he created.
Now it seems as if some states are discovering that they can make good use of this trust in order to fill the treasury with ICOs. After Venezuela has presented with the alleged oil-covered Pedro, the Marshall Islands now want to start with the "Souvereign (SOV)" the first own currency as a cryptocurrency. The project is quite ambitious.
The Souvereign (SOV)
With 72,000 inhabitants and a surface area of 181 square kilometers, which are scattered over more than 1220 islands, the Marshal Islands, located in the middle of nowhere between Australia and America, belong to one of the smallest states in the world. The republic is still suffering from the effects of the massive nuclear and hydrogen bomb tests carried out by the US in the 40s and 50s on the country's formerly inhabited atoll, and does not have bright prospects for the future: economic growth is weak and strongly supported by the US, which will decline significantly over the next decade, while the climate change-induced increase in sea levels can make other parts of the country uninhabitable.
The Marshall Islands do not have their own currency; So far, the US dollar is being used. Now, the island's parliament, the so-called Nitijela, has decided to set up its own currency, or rather its own cryptocurrency, for the first time with the SOV. This is to be awarded by an ICO and then circulate as official means of payment next to the US dollar.
More specifically, the Parliament has adopted the following plan: a total of 24 million SOVs, each divisible into 100 sub-units. Prior to the ICO, the Republic receives 12 million SOV, of which it sells 6 million. The proceeds and the remaining SOV 6 million are to be distributed to various funds, including funds for dealing with climate change and nuclear pollution. Subsequently, the money supply will grow by 4 percent annually. The newly issued coins either go to the miners or are distributed by the ministry of finance. All citizens and traders of the country should be provided with the necessary technical means to use the SOV.
The ICO is organized by the Israeli startup Neema. With it, the country wants "blockchain enthusiasts who have nothing to hide, venture capitalists, banks, and other financial institutions to be involved in building the first crypto-based economy." Unlike any other known cryptocurrency, sovereignty integrates identification the user in the log. The "Yakwe Framework" will bind each wallet to an identities verified by passports and fingerprints. The identity of the user is stored on the blockchain, but encrypted so that only this can reveal it. With the SOV, the country wants to "meet the market's huge need for a non-anonymous blockchain system that works in regulated environments," hopes Minister David Paul. Because the currency has the benefits of Bitcoin, without the disadvantage of anonymity.
Further technical specifications will not be revealed. Will the currency be a token on a blockchain like Ethereum? Or does it become a blockchain of its own - and if so, is this produced by Proof of Work or Proof of Stake? You can only be curious. Here we look at other state blockchain projects.
Turkey and Iran
There is little evidence that both Turkey and Iran are planning to issue their own cryptocurrency in the coming months.
After all, there are some information for Turkey through an article by Al-Monitor. So the small partner of Erdogan's AKP, the National Movement Party (MHP), probably comes up with the idea of developing a Turkcoin. "The world is entering an age of a new digital system. Turkey should form its own digital system and its own digital currency before it is too late, "said the party's deputy chairman, Ahmet Kenan Tanrikulu, the magazine.
Tanrikulu has previously presented a 22-page, amazingly innovative report on digital currencies. In it he explains that the use of digital currencies and the generation of profits by mining and trading in cryptocurrencies are not punishable. The spread of cryptocurrencies in commerce is growing rapidly, according to the report. In order to prevent tax avoidance, capital flight and money laundering, it is proposed to set up a state-controlled Bitcoin exchange.
Regarding their own currency, Tanrikulu says that Turkey should build up the infrastructure for its own blockchain database. Turkey's own currency should be based on the "Wealth Fund". In doing so, the politician complies with Mehmet Simsek of the AKP, Turkey's Deputy Prime Minister, who oversees the economy and chairs the central bank. He announced in an interview on February 7 that the government would prepare to launch a national cryptocurrency based on the Wealth Fund. This includes large state assets such as Turkish Airlines, the Istanbul Stock Exchange, the gas company Botas, Turkish Telecom, Ziraat Bank and the National Lottery. These serve as a kind of value anchor for the digital currency of Turkey.
We only have a Coindesk article about Iran, which refers to a Persian message from the central bank. It says the central bank is developing a cryptocurrency that will be managed by the government. More precise details are very rare or volatilize in trivia.
Venezuelan Pedro - a story of lies?
Meanwhile, criticism of Venezuela's Pedro is loud. In particular, an article here on Steemit by @alemacgo does not go far with the currency project of the socialist country, which allegedly covers a token with a barrel of crude oil.
According to the article, the ICO did not take in $ 750 million, as President Nicolas Maduro claims, but not a tired cent. There would not have been a start yet, just a sloppy website that does not know exactly which blockchain the coin is running, uses bad SSH certificates, sends e-mails with a six-hour delay, and has amateurish JavaScript bugs. There is still no wallet, as well as the opportunity to buy tokens. "Damn, I could even confirm that the government has not yet developed a smart contract and has not yet issued a token."
Maduro pulled all the stops. For example, he said he had met representatives of the NEM Foundation, which was not true at all and became a PR nightmare for the Foundation. Also, the price of $ 60 for a Pedro - which should represent a barrel of crude oil - holds @alemacgo for mischief. Venezuelan oil does not get that price when loaded onto a freighter, and certainly not when it's still in the soil of Ayacucho, a completely untapped oil field with which Maduro covers the Pedro.
All this makes the Pedro for the Venezuelan author nothing but a pure fraud. Another in the history of the fraud and lies not poor government Maduro.
Is Venezuela still open to cryptocurrencies?
Whether fraud or real - the Pedro ICO has an exciting side effect: the president recently announced that all cryptocurrencies, including the Pedro, are completely legal. Given the often harsh restrictions on foreign currencies and strict capital controls, this is a big and surprising step.
Maduro has mandated the various authorities to accept cryptocurrencies for their services. This includes all services provided by consulates and embassies around the world. The national airlines are to sell tickets for cryptocurrencies and pay kerosene with them. In addition, it should soon be possible for tourists to pay for services and hotels with digital currencies, as well as the petrol stations that Venezuela maintains in the country and at the borders with Colombia, as well as the large state oil and gas companies should accept cryptocurrencies.
It is difficult to say exactly why the government is doing to make this move. Is it due to the expectation, in the near future, of receiving large revenues in cryptocurrencies thanks to the ICO? Or has the country actually received large sums of money in Bitcoin, Ethereum and Co. through the unofficial pre-sale of the tokens? This could be a good reason for a full legalization. But it would also be conceivable that Venezuela tries to promote the ICO through the widespread acceptance of the Pedro and other cryptocurrencies - one could also say to "pump" - or that the country simply desperately seeks a functioning money after its own currency, the Bolivar, which made hyperinflation more or less useless. Venezuela may also simply try to shake off the oppressive capital controls by doing its part to replace the dollar with its key currency for international trade through cryptocurrencies.
Shitcoins
At the end of this review of state crypto ambitions, we need to come back to the category of Shitcoin mentioned in the headline. The Shitcoin is a derogatory term for a cryptocurrency. Most of the time, it is being rushed by representatives of dominant cryptocurrencies, especially Bitcoin, to unseen other crypto projects. This does not mean that it has no value as a category.
Shitcoins means cryptocurrencies that basically have no other raison d'être than making their founders and crypto whales rich. They are a bad investment because they are not innovative and have no good developers behind them. In addition, most of the time through pre- or instamining, they have given the founders an outrageously high bonus by allowing them, in one way or another, to get extra many of the coins. On the crypto markets, Shitcoins' liquidity is so low that the altcoin whales manipulate the course through pump'n dumps, enriching themselves at the expense of newbies.
If you put the category of Shitcoins on government cryptocurrency projects, it does not look very good for them. With a premining of 50 percent and the lack of a developer community, the Souvereign (SOV) is ever suspected of being a Shitcoin. However, with the 70,000 or so inhabitants of the Marshall Islands, he could have a lively user community and, as an alternative to the dollar, have real economic added value. After all, the project seems to be driven forward in a serious and transparent manner and also with a genuine, if questionable, innovation - the abolition of anonymity. Accordingly, the SOV should not be a real Shitcoin.
The situation is different for the Pedro, of course. The Coin meets much more criteria of the Shitcoins: advertising with nonexistent cooperations, the blurry and confusing technical descriptions, the bad website, questionable claims about revenue, the missing developers - there are many red flags. If the Pedro did not have the Venezuela bonus, investors could only be advised to run away from it as fast and as far as possible. But you have to say that the Coin, if it should be online and open source, can still be a step forward. Because worse than the Bolivar, the largest Shitcoin of Fiat currency, it can hardly come.
Overall, one should observe the development of state ICOs with some skepticism. Apparently, this is often behind the government's motivation to fill its coffers by outweighing the credibility of a state from the crypto markets with digital gold. The state-run ICOs also show that government-issued money has not yet been able to keep up with the high standards that the markets have for good crypto money. If it were not for government coverage, the Coins of the Marshall Islands as well as Venezuela would not be the least interesting.
The fact that governments are behind it, however, makes the planned cryptocurrencies exciting again. Perhaps they mark the demise of FIAT money by showing how little government can compete with private money - and perhaps they are a milestone in the evolution of FIAT money, now, after centuries of paper and virtual databases, with cryptography finally solid again and stable.
Image Sources:
- Post header created by myself
Have a nice day!
LOVE&LIGHT
I hope governments create their own cryptocoins and list them on exchanges. Everyone will then be able to dump them in exchange for actual crypto. It will GREATLY ease the transition from statist money to P2P, decentralized money.
On-ramping noobs into crypto from fiat will be SUPER easy for the population of those countries.
Am I wrong that cryptocurrencies are meant to decrease the value of centralized institutions(Governments as well).
So why they would implement crypto?
https://freebitco.in/?r=10689239 (for free BitCoin)
http://freedoge.co.in/?r=1178803 (for free DogeCoin)
Come after every hour and play as much you play as much you earn
Good Luck
I would trust a government created coin as much as I trust Ripple.
However, I can't believe Drachma Coin isn't on your list.
Drachma Coin is a new project that aims to be the national cryptocurrency of Greece.
The best part is, Drachma wasn't created by a government, rather, it was made possible by the Steemit Community.
You can read the white paper here: https://steemit.com/greek-trail/@christosthegreek/the-drachma-coin-white-paper
I don't like govts introducing their own cryptocurrencies, total rubbish.
Committee on Payments and Market Infrastructures released a paper like 2-3 days ago claiming national cryptocurrencies (initiated by central banks) are a threat to financial system. Report shows the competition between these currencies and fiat money will cuase several issues in banking system. Taking it into account, it's hard to believe that other countries will tolerate this. Unless USA, China, Germany, Russia , Japan and others from G20 will not issues own currencies (and aparantly they will not) these El Petro and it's friends will face sanctions of some kind.
Link to report for reference: https://www.bis.org/cpmi/publ/d174.pdf
https://freebitco.in/?r=10689239 (for free BitCoin)
http://freedoge.co.in/?r=1178803 (for free DogeCoin)
Come after every hour and play as much you play as much you earn
Good Luck
Fiat and Crypto are both intangible value systems of belief, the difference being with coins like Bitcoin there is a limited supply as well as the value added by the blockchain. States can issue all the shitcoins they want but they won't see the masses lining up to grab huge bags because the fundamental motive to do so is lacking. It will still be a state issued currency when the whole point of Bitcoin is to be decentralised; The state is not invited!
Surely more national currencies will be built in the up-coming years . It's already begun , it is happening . Soon we will see currencies named by our hometowns .
https://freebitco.in/?r=10689239 (for free BitCoin)
http://freedoge.co.in/?r=1178803 (for free DogeCoin)
Come after every hour and play as much you play as much you earn
Good Luck
Most governments of the world are in debt that will never be repaid because the growth needed to repay it would need to be funded with more debt. For every dollar of growth it is costing several dollars of debt.
The inevitable collapse of the global Ponzi scheme is what is likely fuelling the growing number of states to seriously look at issuing their own shitcoins. Initially they will be held and traded by central banks, commercial banks and businesses to give the illusion of legitimacy. Eventually they will be forced upon the masses to use them as we head into a cashless society, the infrastructure will be put in place so that if you don't, you wont have access to an ever increasing supply of items and services. I think this is why we see these mixed signals around the world where they crack down on crypto and exchanges and in the same breath speak positively about blockchain and crypto.
good info
I fell out when I cam to part tree: Turkey and Iran.
Felt I did get your point of view.
My view!! Lets help thees poor people!!
I dont need too hold my whole life secret. Just the privet embarresing stuff.
I feel we are so focust on the secretsy, and WHAY!
Who do we not trust?
90% of the peapole in the world are Good folks.
That leads me too the conclusion. That the onley thing Im afraid of is to be TAXED out of proportion and be controlled.
Iot(a) = Terminator Movies
Bitcoin = Rockefeller
Eth = JPMorgan
My Point Of View:
Its Too Muche Secrecy In the World, That Is What Has Made It As It Is.
Good Folks wont pay 90% to the middel man if they could pay littel more, and make the world a better place.
https://freebitco.in/?r=10689239 (for free BitCoin)
http://freedoge.co.in/?r=1178803 (for free DogeCoin)
Come after every hour and play as much you play as much you earn
Good Luck
i am gonna invest in these shitcoins and tokens. i am 100% sure, i love such crap :)
very informative post. The History Of National Currencies is very interesting......
https://freebitco.in/?r=10689239 (for free BitCoin)
http://freedoge.co.in/?r=1178803 (for free DogeCoin)
Come after every hour and play as much you play as much you earn
Good Luck
I wish i were born in mashal island or just be a citizen
https://freebitco.in/?r=10689239 (for free BitCoin)
http://freedoge.co.in/?r=1178803 (for free DogeCoin)
Come after every hour and play as much you play as much you earn
Good Luck
It is only a matter of time before governments get involved. It just too lucrative to passby. Additionally, it will give governments more control over cryptos as they would try to bring some legitamacy into the game.; thus, back to centralization as that is the plan. ...control of the massess.
https://freebitco.in/?r=10689239 (for free BitCoin)
http://freedoge.co.in/?r=1178803 (for free DogeCoin)
Come after every hour and play as much you play as much you earn
Good Luck
Honestly, I really hate these new government coins like Soveriegn and the Petro (oil-backed crypto from Venezuela) because it completes destroys the purpose of cryptos. Like, why make a crypto when you know that this industry is meant to not have middle-men?!? So, I am really with you on this one. Keep up the good work and you earned an upvote/follow from me (@cryptoevan7)
https://freebitco.in/?r=10689239 (for free BitCoin)
http://freedoge.co.in/?r=1178803 (for free DogeCoin)
Come after every hour and play as much you play as much you earn
Good Luck
very informative post. Thank you for share this
This post is very useful... and very inspiring...
Some countries could really benefit from their own cryptocurrency to be honest. But I dont think they should be created by the government - the point is to be decentralised?
Could just start for instance Turkeycoin, not run by the government .. probably get pumped by someone who thinks its a good investment though
In this bearish market a game can be great to lighten the mood :) Come check out Chibi Fighters. No levelling required. Use your wits. Coming 2018. ERC721 non-fungible token game. https://chibifighters.io We are already in Alpha 0.3 and things are coming along great.