Freicoin - easy-to-use demurrage currency

Q: What is the Freicoin Foundation? A: The Freicoin Foundation is a non-profit organization, aiming to support sustainability and biodiversity by integrating Freicoin into economical relations.<p>Q: You said that Freicoin is decentralized. But the Foundation makes it centralized! A: You are right. But we have no other solution. Initial coins should be distributed to the society.<p>Q: Why can't you just give these coins to miners (as in Bitcoin). Why do we need a bureaucracy? A: The mining community consists mostly of enthusiasts, not ordinary people who use computers to browse the Internet.<p>Q: How many coins does the Foundation have? A: The Freicoin Foundation distributes 80% of the total Freicoin money supply through grants. The remaining 20% is a reward for miners, who support the network with their computing power.<p>Hahaha... no.

One does not simply invent a currency to solve a percevied problem in our economic system. A currency must also provide compelling economic reasons to actors for adoption. That is, what is in it for me to use freicoin?<p>I don't see any reason to give money, buy, or sell, or do anything with freicoin. To me, the fact that freicoin decays when not used is a bug, not feature.

Does anybody else feel that the current proliferation of P2P cryptocurrencies looks symptomatic of a pyramid scheme that has proven its viability (in the form of BTC) and is now being repeated by unscrupulous copycats who smell a quick buck?<p>I'm not calling the concept of BTC-style cryptocurrency a deliberate, malicious pyramid scheme in itself. I think this is an unintended side-effect.

Funny, just this morning I decided to write a blog post about Gesell and the 'Schwundgeld' and his short usage in the city of Wörgl almost a century ago. The real question, of course, is wether inflation isn't a much more natural way of depriving currency of it's value.

Who does the demurrage fee go to? I couldn't find any information about this on their site. If it is just recirculated through re-mining or something, great (though I don't know how that would work). If it goes to the creators of freicoin then it is a blatant scam. I don't suppose it does, but it's suspicious that they don't mention where the money goes.

Some of the comments in the FAQ don't make any sense.<p><pre><code> Q: Why does Freicoin use demurrage? I'm worried that my coins will just fade away. A: Worried? It's a good thing. If the amount of money was stable, people would prefer saving it as opposed to spending it. This would decrease the quantity of money circulated, which in turn would act against the main purpose of money - a medium of exchange. With demurrage in place, you should think about money as it's meant to be, not as a storage medium of wealth. </code></pre> This is quite an assertion--generally, money is taught to be both a store of value and a medium of exchange. What are you exchanging if there's no value in it?<p>There are also some really odd grammatical errors:<p><pre><code> Q: With a zero interest rate, investments will be impossible! A: It's already possible, for example, in Islam banking... </code></pre> "Islam banking"?

What tickles me is that the people who criticise Wall Street for the value-less financial engineering of real estate, equities, commodities, etc., i.e. productive assets, turn around and start trying to create value out of thin air in fiat/social financial engineering schemes. I'm not commenting on the value of either activity directly as much as the asymmetry in holding both views simultaneously.

In other words, saving money is completely disincentivized in favor of constant spending? Why would anyone adopt this?

Not the solution yet, but closer than anything we have<p><a href="http://en.wikipedia.org/wiki/Silvio_Gesell" rel="nofollow">http://en.wikipedia.org/wiki/Silvio_Gesell</a><p><a href="http://geokey.de/literatur/doc/nwo.pdf" rel="nofollow">http://geokey.de/literatur/doc/nwo.pdf</a> (German)

Doesn't seem to have a technical paper, or any real details on how it implements its goals. Anyone know if it's out there somewhere?<p>Edit: I found this: <a href="https://bitcointalk.org/index.php?topic=35705" rel="nofollow">https://bitcointalk.org/index.php?topic=35705</a><p>Looks like demurrage is implemented simply by a rule for block validation: transaction outputs have to subtract from inputs based on the age of the coins. Don't know how they calculate age unambiguously.<p>There seems to be a lot of centralization in this particular implementation...eg., 80% of new coins go to the foundation for the first three years, which says it will distribute based on ideological motivations.

These are similar to concepts North Korea still cannot prove... I'm concerned that in the FAQ the creators think that private banks control money supply. While inflation and deflation are often painful, they're also the reason why cyclic growth is possible. Once upon a time, cycles enabled an American middle class. I'm optimistic we can revive that with historically effective method.<p>We all agree central banks stink in a recession, they are somewhat limited in what they can do, but during growth they double the fun.<p>I see the creator is intending income equality, and I think that's definitely just and purposeful. More research required.

How is this technically implemented -- is the demurrage subtracted once a year, or when you send a transaction?<p>Where do the coins taken for this fee go?<p>How can I apply for a grant from the foundation?

Good try at separating transactions from holding currency. The 'killer app' is not a government-less currency. The killer app is frictionless digital transactions. A previous article expanded on it.

I'd like to hijack the daily Bitcoin thread for a tangential discussion. My dad used to have a stamp collection. Back in the day most people would give you a funny look if you told them you collect stamps, but it was pretty cool to browse the collection and see all those stamps from all over the world. And the really rare stamps could cost quite a lot of money. So here's the question: is Bitcoin more valuable than stamps?

So why would a reasonable actor choose to store money in this currency when there are easier to get, easier to use, demurrage free currencies available? I get the economic idea (I think) but it seems like something that would need a near monopoly to succeed. Otherwise it will just be a money pit for idealistic enthusiasts.

&#62;&#62;&#62;Every Freicoin client is capable of performing these tasks, but in practice mining is the domain of computer enthusiasts and IT professionals with tuned top-level hardware<p>Given that my PC is obsolete crap, should I even bother getting the client?

The IndieGoGo campaign - <a href="http://www.indiegogo.com/projects/freicoin-global-community-currency-from-the-occupy-movement" rel="nofollow">http://www.indiegogo.com/projects/freicoin-global-community-...</a>

complete and utter scam

If anyone is interested in a alternative bitcoin clone that actually tries new things have a look into ppcoin.

Being conditioned like this, wouldn't that deter early adopters? I mean, what would incentivize them?