Quote from: MacRohard on July 14, 2011, 05:43:44 PM

Quote from: realnowhereman on July 14, 2011, 03:36:12 PM

Let's say I am an owner of gold and a seller of gold certificates. People would like to use gold, but it's hard to buy and sell things with it. I am honest; and trusted (people already buy my certificates).

snip

This would be utterly pointless.

If people have to rely on a central counterparty to redeem their certificates for gold (or anything else - people have proposed that share registries might be maintained in a bitcoin block chain but again that would be pointless) that central counterparty might as well maintain the database of who owns what. There's no benefit to having a complicated distributed database like bitcoin for that when all the risk is already concentrated in a central counterparty. If your central counterparty is going got cheat you then they will. If the government forces the central counterparty to take some action then they will. It doesn't make a damn bit of difference if the central counterparty keeps the records of who owns what in a simple spreadsheet.

1. You didn't read to the end, when I was mainly using all that to make a point that gold is no better than bitcoins.

2. Given how useless gold is, people probably do only do one thing with their certificates... "redeem" them. Once they are tradeable without the involvement of the issuing authority, I doubt they would ever need to be redeemed. So.. the certificating parties database needn't even exist.

3. The certificating authority doesn't need to know who owns any particular unit of bitgold; they are just the creator of it. What if I bought bitgold from you in exchange for bitcoins? Or vice versa.

4. There is nothing the government can do to the issuer, other than take their gold from them. Government's stealing gold would probably cause a bit of uproar.

As I said, I'm not actually advocating. I doubt enough of us have enough gold to make this practical. But "utterly pointless" seems a little harsh.