John Congdon
New member
Proposal: Create two fiat currency banks in Puerto Rico that operate with both fiat and decentralized crypto currencies. Funding needed: US$1,500,000.
Creating a fiat bank can better be thought of as a free expansion for Dash brought on by a very favorable exchange rather than being thought of as an expense. Why? Because it will involve using assets of the Dash community that can continue to function as they are currently being used. Only about $50-70,000 in application fees and legal expenses will actually be spent to set up the two banks, the rest will be used to meet initial reserve requirements of Puerto Rico which as a territory of the US falls into its general banking jurisdiction. Dash’s investment in the banks can be immediately multiplied by a factor of seven or eight. That multiplication factor of capital funds can in turn be directed by the Dash community, in either fiat or Dash, to expand its services as long as it does not compromise the fiduciary responsibility of the banks. It’s a complete win-win situation.
In more detail the benefit to the Dash community and Foundation can be whatever the community would like to make of it. With the investment of the $1.5 million the banks will be able to finance for Dash around $11 million in projects. The requirement regarding projects besides being of benefit to Dash is only that the project must be sufficiently successful to pay for itself over a designated time period.
Suggestions of possibilities could be a physical headquarters for the Foundation and core team that will serve as a Dash HQ where the people that are conveniently available and would enjoy such an environment can physically work together as a team. The building can be built large enough to plan for growth and in the interim unused spaces could be leased to synergistic enterprises. The HQ could include a large mining operation that could mine selected currencies which can serve as a basis for a Dash exchange and also profit center for paying employees.
Software for handling Visa and Master Card accounts can be acquired that make holding Dash until the time of a purchase in fiat a practicality. Likewise merchants can be enabled to accept Dash directly in a Dash system yet when they need to make payments in fiat can do so seamlessly through their debit accounts. Strategically acceptance by businesses is the most important criteria for growing the use of Dash or any crypto currency.
The setup expenses of the banks would be funded by the development budget. The Dash assets to capitalize the banks can come from the master nodes. This could be accommodated by a simple change to allow the 1,000 Dash requirement held by a master node to be met at least in part by shares in the bank or a separate Dash account in the bank. All investment in the banks will be offset by owning shares in the bank including the legal and application fees mentioned above. Owning a bank is perhaps the safest investment that one could make because a well-managed bank is a literal fiat money making enterprise having the legislated power to multiply its capitalization many times over, currently up 12.5 times in the US.
There is a white paper attached below that explains in greater detail about the other functions of the banks and why there are to be two banks. Briefly the banks are to be held in a non-profit holding entity called the Golden Rule Network, or GRN, “grin” for short. The banks are identified as the Golden Rule Trust, or GRT, “great” for short; and will function as a public utility for creating sustainability in the world through sustainable green investments similar to the concept of green banks.
The banks will employ a unique strategy to raise funding for financing sustainable development on a large scale. Shareholders will be able to enjoy the appreciation of the increase in the value of the stock price as more and more sustainable projects are added.
IMPORTANCE TO THE DASH COMMUNITY:
The CIA reports that currently there is a bit more than $80 trillion in bank issued fiat currencies worldwide. This figure includes savings but does not include credit card debits which also act as money. Nor does it include bonds which are widely traded and can act as currency reserves and savings. The total amount of crypto is currently valued under $90 billion which is something to cheer, but represents only 0.001% compared to the fiat money supply. That as yet is not in any manner even a blip on the world economic stage. Crypto in actual use as money is still far less.
Obviously there are some very good reasons to move away from national currencies. In part due to their continuous devaluation by government overspending but more to their high costs of use and control by special interests that do not represent the broad spectrum of society. However the current characteristics of the crypto currency scene make it more of a decentralized stock market rather than functional decentralized currencies. That is something with which we need to come terms if crypto is to be accepted as money as opposed to shares of stock held for appreciation or traded in and out for short term financial gain.
The purpose of currency or money is to facilitate exchange, to represent a stable value and be spendable. End of story. There are desirable characteristics that can make money more useful as well as characteristics that make money less useful or can cause problems. The stability of the value of a currency is typically important for businesses as they don’t want to expose themselves to additional risk. If a currency is going to change value due to volatility it creates risk and businesses are already facing enough risk that they will be quite reluctant to assume more.
We might at times think if the value is going up that’s great, especially if we happen to be in possession of that currency. Yet that will tend to inhibit the use of a currency and in the case of crypto, its easy adaption as a viable fiat alternative. First, who will want to spend the currency if they believe that it will have greater value shortly? Better to hold on to it. A second part is that for businesses the buying of new supplies as well as internal operating costs will become more than budgeted. That can be a major problem and even disaster for a company as all of their contracted and supply expenses, that’s all of their COGS, increase beyond their anticipated budgets.
Future markets were specifically created to offset the risks associated with price change of widely used key products due to such volatility. Trading in currency futures or FX is a highly beneficial market in international trade primarily existing to offset the risks to commerce associated with currency price changes. Volatility is not a desirable trait for any currency even if it is a steady increase in price. This point cannot be ignored if one wants to replace fiat currencies.
There is a law in economics that also applies and it states that bad money drives out good money. It means that when given a choice people will want to spend that which appears to be of lesser value and hoard that which is perceived to be of greater value. History is replete with examples of this law at work. It is a powerful influence to be noted in the desire to create a functional currency.
While crypto is growing rapidly in relation to its current size, to make a significant change in the world and enter mainstream economics, seamless fungibility between crypto and fiat will certainly be of utmost importance. That will need to take place before its acceptance in the everyday commercial needs of businesses and the general public. One of the easiest ways to accomplish this will be to establish a fiat currency bank with international branches and decentralized access that simultaneously deals with and holds crypto currency as well as fiat.
Realizing that this is a major proposal to be considered for adoption I welcome any questions and comments as well as requests for additional information. There remain a number of details that will need to be fleshed out so the proposal can be approached with ideas of flexibility and expansion. It’s quite possible that the fiat banks could assist considerably with the planned release of Evolution.
The creation of money has been an interest of mine for several decades so substantial attention has been given in the study thereof. I am very pro decentralization as making the world a better and sustainable place in which to live so I find the blockchain and Dash a wonderful addition to achieving that goal. My contribution will be much more in strategy and planning than in technical abilities.
REGARDING IMPLEMENTATION:
The issuance of a banking license in Puerto Rico is said to take 4-5 months. There is an application fee of $5,000 for each bank proposal thus two banks will be $10,000. There will also be legal and consulting fees for preparing and filing the application. When the application is approved there are two deposits that need to be made, one of $250,000 for initial capitalization and another of $300,000 to be a guarantee to be held by the central bank. That amounts to $1,100,000 for the two banks. Then there is a $5,000 yearly licensing fee or another $10,000.
Puerto Rico places some simple conditions as this is a program to create economic development in Puerto Rico. That is to have an office in Puerto Rico and to have at least 4 employees employed full time. There is a tax saving plan whereby the income tax rate for the financial entity on net income will be 4% for 15 years and additional extensions may be requested for two more 15 year extensions for a total of 45 years.
Due to the significance of the investment for Dash it would be appropriate that Dash can appoint a director to both GRN and GRT. Another possibility is that I could join the Dash core team during implementation of the project so that all progress and development events are coordinated with the core team. Of course trustless contracts can implement the banking structures as well as be used in account creation.
I want to emphasize that this will be an investment whereby all funds invested will be accounted for by receiving shares in the banks. Management expenses of the banks will be kept to normal management salaries comparative with a cooperative or savings and loan association. Again the banks are to be run as a public service project. The shareholders will receive the benefit of increase in the share value. It is expected that the majority of shareholders will be in the middle class property owners. The banks themselves will operate as though they were non-profit entities. The whitepaper explains the banks’ purpose in addition to assisting Dash in more detail and is attached below.
John Congdon
Creating a fiat bank can better be thought of as a free expansion for Dash brought on by a very favorable exchange rather than being thought of as an expense. Why? Because it will involve using assets of the Dash community that can continue to function as they are currently being used. Only about $50-70,000 in application fees and legal expenses will actually be spent to set up the two banks, the rest will be used to meet initial reserve requirements of Puerto Rico which as a territory of the US falls into its general banking jurisdiction. Dash’s investment in the banks can be immediately multiplied by a factor of seven or eight. That multiplication factor of capital funds can in turn be directed by the Dash community, in either fiat or Dash, to expand its services as long as it does not compromise the fiduciary responsibility of the banks. It’s a complete win-win situation.
In more detail the benefit to the Dash community and Foundation can be whatever the community would like to make of it. With the investment of the $1.5 million the banks will be able to finance for Dash around $11 million in projects. The requirement regarding projects besides being of benefit to Dash is only that the project must be sufficiently successful to pay for itself over a designated time period.
Suggestions of possibilities could be a physical headquarters for the Foundation and core team that will serve as a Dash HQ where the people that are conveniently available and would enjoy such an environment can physically work together as a team. The building can be built large enough to plan for growth and in the interim unused spaces could be leased to synergistic enterprises. The HQ could include a large mining operation that could mine selected currencies which can serve as a basis for a Dash exchange and also profit center for paying employees.
Software for handling Visa and Master Card accounts can be acquired that make holding Dash until the time of a purchase in fiat a practicality. Likewise merchants can be enabled to accept Dash directly in a Dash system yet when they need to make payments in fiat can do so seamlessly through their debit accounts. Strategically acceptance by businesses is the most important criteria for growing the use of Dash or any crypto currency.
The setup expenses of the banks would be funded by the development budget. The Dash assets to capitalize the banks can come from the master nodes. This could be accommodated by a simple change to allow the 1,000 Dash requirement held by a master node to be met at least in part by shares in the bank or a separate Dash account in the bank. All investment in the banks will be offset by owning shares in the bank including the legal and application fees mentioned above. Owning a bank is perhaps the safest investment that one could make because a well-managed bank is a literal fiat money making enterprise having the legislated power to multiply its capitalization many times over, currently up 12.5 times in the US.
There is a white paper attached below that explains in greater detail about the other functions of the banks and why there are to be two banks. Briefly the banks are to be held in a non-profit holding entity called the Golden Rule Network, or GRN, “grin” for short. The banks are identified as the Golden Rule Trust, or GRT, “great” for short; and will function as a public utility for creating sustainability in the world through sustainable green investments similar to the concept of green banks.
The banks will employ a unique strategy to raise funding for financing sustainable development on a large scale. Shareholders will be able to enjoy the appreciation of the increase in the value of the stock price as more and more sustainable projects are added.
IMPORTANCE TO THE DASH COMMUNITY:
The CIA reports that currently there is a bit more than $80 trillion in bank issued fiat currencies worldwide. This figure includes savings but does not include credit card debits which also act as money. Nor does it include bonds which are widely traded and can act as currency reserves and savings. The total amount of crypto is currently valued under $90 billion which is something to cheer, but represents only 0.001% compared to the fiat money supply. That as yet is not in any manner even a blip on the world economic stage. Crypto in actual use as money is still far less.
Obviously there are some very good reasons to move away from national currencies. In part due to their continuous devaluation by government overspending but more to their high costs of use and control by special interests that do not represent the broad spectrum of society. However the current characteristics of the crypto currency scene make it more of a decentralized stock market rather than functional decentralized currencies. That is something with which we need to come terms if crypto is to be accepted as money as opposed to shares of stock held for appreciation or traded in and out for short term financial gain.
The purpose of currency or money is to facilitate exchange, to represent a stable value and be spendable. End of story. There are desirable characteristics that can make money more useful as well as characteristics that make money less useful or can cause problems. The stability of the value of a currency is typically important for businesses as they don’t want to expose themselves to additional risk. If a currency is going to change value due to volatility it creates risk and businesses are already facing enough risk that they will be quite reluctant to assume more.
We might at times think if the value is going up that’s great, especially if we happen to be in possession of that currency. Yet that will tend to inhibit the use of a currency and in the case of crypto, its easy adaption as a viable fiat alternative. First, who will want to spend the currency if they believe that it will have greater value shortly? Better to hold on to it. A second part is that for businesses the buying of new supplies as well as internal operating costs will become more than budgeted. That can be a major problem and even disaster for a company as all of their contracted and supply expenses, that’s all of their COGS, increase beyond their anticipated budgets.
Future markets were specifically created to offset the risks associated with price change of widely used key products due to such volatility. Trading in currency futures or FX is a highly beneficial market in international trade primarily existing to offset the risks to commerce associated with currency price changes. Volatility is not a desirable trait for any currency even if it is a steady increase in price. This point cannot be ignored if one wants to replace fiat currencies.
There is a law in economics that also applies and it states that bad money drives out good money. It means that when given a choice people will want to spend that which appears to be of lesser value and hoard that which is perceived to be of greater value. History is replete with examples of this law at work. It is a powerful influence to be noted in the desire to create a functional currency.
While crypto is growing rapidly in relation to its current size, to make a significant change in the world and enter mainstream economics, seamless fungibility between crypto and fiat will certainly be of utmost importance. That will need to take place before its acceptance in the everyday commercial needs of businesses and the general public. One of the easiest ways to accomplish this will be to establish a fiat currency bank with international branches and decentralized access that simultaneously deals with and holds crypto currency as well as fiat.
Realizing that this is a major proposal to be considered for adoption I welcome any questions and comments as well as requests for additional information. There remain a number of details that will need to be fleshed out so the proposal can be approached with ideas of flexibility and expansion. It’s quite possible that the fiat banks could assist considerably with the planned release of Evolution.
The creation of money has been an interest of mine for several decades so substantial attention has been given in the study thereof. I am very pro decentralization as making the world a better and sustainable place in which to live so I find the blockchain and Dash a wonderful addition to achieving that goal. My contribution will be much more in strategy and planning than in technical abilities.
REGARDING IMPLEMENTATION:
The issuance of a banking license in Puerto Rico is said to take 4-5 months. There is an application fee of $5,000 for each bank proposal thus two banks will be $10,000. There will also be legal and consulting fees for preparing and filing the application. When the application is approved there are two deposits that need to be made, one of $250,000 for initial capitalization and another of $300,000 to be a guarantee to be held by the central bank. That amounts to $1,100,000 for the two banks. Then there is a $5,000 yearly licensing fee or another $10,000.
Puerto Rico places some simple conditions as this is a program to create economic development in Puerto Rico. That is to have an office in Puerto Rico and to have at least 4 employees employed full time. There is a tax saving plan whereby the income tax rate for the financial entity on net income will be 4% for 15 years and additional extensions may be requested for two more 15 year extensions for a total of 45 years.
Due to the significance of the investment for Dash it would be appropriate that Dash can appoint a director to both GRN and GRT. Another possibility is that I could join the Dash core team during implementation of the project so that all progress and development events are coordinated with the core team. Of course trustless contracts can implement the banking structures as well as be used in account creation.
I want to emphasize that this will be an investment whereby all funds invested will be accounted for by receiving shares in the banks. Management expenses of the banks will be kept to normal management salaries comparative with a cooperative or savings and loan association. Again the banks are to be run as a public service project. The shareholders will receive the benefit of increase in the share value. It is expected that the majority of shareholders will be in the middle class property owners. The banks themselves will operate as though they were non-profit entities. The whitepaper explains the banks’ purpose in addition to assisting Dash in more detail and is attached below.
John Congdon
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