Problem: The current Petro-dollar is antiquated, difficult to use and easy to manipulate (by the government).
The current Petro-dollar reserve currency is a detriment to the People. By printing money and inflating asset prices the US government and the Federal Reserve decrease the wealth of the people over time. It also contributes to excessive business cycles and economic instability in all nations.
Solution: The Gold-Backed Crypto Dollar Act
Each gold dollar (GD) is backed by an amount of gold equal to 1/(spot price of gold in fiat US dollars at turn-over)
The number of GD is fixed at 2.259 Trillion
The GD will be infinitely divisible
Elimination of Reserve Banking
Revised regulations to allow for peer to peer lending, insurance and investing.
Elimination of Qualified Investor Status
Elimination of Federal Reserve
Treasury to target gold reserves to maintain 2% deflation per year
Federal Balanced budget Amendment
Asteroid Rule: precious metals from Asteroid Belt will be introduced in such a manner to limit financial volatility (excessive inflation)
Each GD will be agnostic in terms of location, buyer, seller. The only information available from the blockchain will be the ancestry of the GD. In other words — the information that is currently available on most blockchains. Note — this is as much (or more) information as law enforcement could get when we were in a cash-based system.
Each GD must be secured from attack by quantum computers
War Chest — the Federal Government will establish a war chest (in GD) to be used in the event of war or military incursion. The Government may no longer borrow to wage war — it must save instead.
Benefits:
The money that you keep will rise slowly in value rather than declining in value.
Business Cycles will be reduced or eliminated.
Privacy will prevent government over-reach and totalitarianism. Organized crime will have no more advantages than in a classic cash-based system.
More effective systems for insurance, re-insurance and lending
Improved ability to raise capital for new businesses and ongoing lending needs for established businesses. Improve market access for all businesses.
War is not as likely (easy to borrow, but harder to save). The idea is that when you expend money from your war chest, you are spending wealth you have already created to cause destruction of wealth in another nation.
It is a digital currency, but there is no “central bank” part of it. It is similar to a true gold-backed currency where you can exchange one promissory note (not a debt instrument!) for an equivalent amount of gold. I prefer gold eagles as United Precious Metals Association (UPMA) does. Like UPMA, you have to be able to audit the gold to ensure there is enough to cover the promissory notes. The blockchain part is how everyone balances the ledger (with blockchain everyone has a copy of the ledger, therefore no one has a question about who owns what.) There is currently a PAXG cryptocurrency that does exactly this. Problem is, it is not widely accepted as payment for items (it is more a store of value).
Why a gold-backed digital currency that would remove our ability to pay for things with physical currency - and create all the problems that come with not having physical currency - instead of backing physical currency with gold?
I don’t necessarily think you would have to eliminate promissory notes (paper currency), but even today a vast majority of transactions occur without paper currency. Think of the blockchain as a personal vault that even a nuke couldn’t destroy. As for the ability to control it — here is an article from Harvard Business Review
Really? Because your original proposal suggest otherwise:
I’ll have you know that a majority of my purchases occur with cash, and it’s my understanding that paying with cash is actually on an upswing right now.
But none of that gets past the problems inherent with doing away with physical currency.