Quote from: trippy on June 15, 2011, 12:07:55 PM

Instead of pegging to the price of a kWh, why not just peg to the dollar? Huh

Anyway, the central authority will quickly go bankrupt and then people will be unable to redeem their coins for kWh.

Read this before continuing to make suggestions: https://secure.wikimedia.org/wikipedia/en/wiki/Currency_peg

On top of that, you're suggesting all fees will be arbitrarily set by a central authority which can change its mind at any time. Hahaha! You made a joke! Cheesy

Yes, there probably will be something like dollarcoin that is pegged to the dollar. Actually, this would have been an simpler example for me to have used to illustrate the concept of backing a Bitcoin-like currency with something. It would be just like the kwhcoin where if you give the convertiblity house $1,000 then they give you 1,000 new dollarcoins (and convertibility house puts the $1,000 in the bank to earn interest) and similarly when you give the convertibility house 1,000 dollarcoins they give you $1,000 and destroy those 1,000 dollarcoins. Unless the dollarcoin convertibility house were fraudulent or incompetent there would be no way they could go bankrupt with managing dollarcoin because they could earn the interest on the dollars they got from issuing new dollarcoins and would only have to redeem the principle when people cashed in dollarcoins. I think currency users would prefer kwhcoins over dollarcoins so that is why a convertibility house may want to assume greater risk to create a currency more competitive than dollarcoins.

I just read the wikimedia article you posted and don't see how the information on that page invalidates the concept of kwhcoins or dollarcoins.

Also, the primary purpose of allowing for the adjustment for transaction fees was to give the convertibility house the opportunity to subsidize transaction fees with the goal of making their currency more competitive so more people used their currency (i.e. so the dollarcoin convertibility house could hold more principle so they could earn more free interest). I think currencies will want to compete for your business.