Maybe it is, I am still not sure, but the federal reserve has different motivations (inflation) the motivation behind this is circulation coins and accepting people obviously NEED to sell their DVC when they get paid out, (or else they would hold them to make more money wouldn't they?)without flooding the market every month.. At the end of the day this is affecting price overall and the people cashing out are not getting the best they could either.
In a FIAT world my gold coin is worth a gold coin...in a Devcoin world its scary how much my one coin can change in value overnight. As someone who is now working from home, I can tell you this is not really a great way to get paid for work...
(yet?)
so ...in this idea, if user A buys DVC to spend on phone cards or mobile phones or websites (any other products available for DVC yet?) and user B sells his DVC for cash, then user A ends up circulating the coins user B cashed in..and the phone-card/mobile phone or website seller has somewhere to cash in those same coins, so they can circulate again, without having to play the "money market" but actually supporting the market by not playing it......kind of ...sorry that's such a simplistic idea, but Im struggling to explain an unformed idea
It would also make DVC based commerce simpler if there was an exchange like this, purchasing DVC should be as easy as cashing them in for it to work. Ideally, if this fund could offer (on average) the median buy price from the exchanges, and list DVC at a higher sell price on the same exchanges, it could have a stabilising effect on the market (depending on volume from what I understand from an earlier post regarding sell and buy sides? please correct me if this is wrong) and potentially bring a return for investors as well as building a fund to support developers/creators that don't really fit the "devcoin developer" model. (for example I would love to see indigenous artists in really remote areas supported by DVC and beyond the reach of red tape BS....but that's a personal dream
And Im no closer to writing this up because I keep coming back to re-read what I already wrote and what you guys have said lol
1) Banks don't really hold funds, that's a general misunderstanding. When you deposit cash it's a liability of the bank because you've loaned them money. The reason it feels like they're holding funds is generally due to state deposit insurance. Banks don't need deposits on the whole, that's a myth. When they make a loan that's an asset of the bank and a new offsetting deposit is created on the liability side automatically - i.e. loans create deposits, banks create money.In a FIAT world my gold coin is worth a gold coin...in a Devcoin world its scary how much my one coin can change in value overnight. As someone who is now working from home, I can tell you this is not really a great way to get paid for work...
(yet?)so ...in this idea, if user A buys DVC to spend on phone cards or mobile phones or websites (any other products available for DVC yet?) and user B sells his DVC for cash, then user A ends up circulating the coins user B cashed in..and the phone-card/mobile phone or website seller has somewhere to cash in those same coins, so they can circulate again, without having to play the "money market" but actually supporting the market by not playing it......kind of ...sorry that's such a simplistic idea, but Im struggling to explain an unformed idea
It would also make DVC based commerce simpler if there was an exchange like this, purchasing DVC should be as easy as cashing them in for it to work. Ideally, if this fund could offer (on average) the median buy price from the exchanges, and list DVC at a higher sell price on the same exchanges, it could have a stabilising effect on the market (depending on volume from what I understand from an earlier post regarding sell and buy sides? please correct me if this is wrong) and potentially bring a return for investors as well as building a fund to support developers/creators that don't really fit the "devcoin developer" model. (for example I would love to see indigenous artists in really remote areas supported by DVC and beyond the reach of red tape BS....but that's a personal dream
And Im no closer to writing this up because I keep coming back to re-read what I already wrote and what you guys have said lol
This is a whole other topic. But I make the point because the analogy of a bank translates to the idea that a dvc fund could and would have to control the money supply in supporting the market by not playing it, if it's guaranteeing return or exchange at a certain 'price'.
2) That's perhaps a bit technical but this leads to... to avoid that it would need to purchase and hold dvc reserves equal to deposits on a rolling basis - then it's just an intermediary. That could be a lot of reserves and it would also mean it can't control prices. So if what you're referring to basically a dvc/fiat exchange then I agree that's a good idea. The issue here is that it can't work in isolation. If the fund's dvc/$ price differs in any way to the implied dvc -> btc -> $ or dvc -> ltc -> $ price etc, then the differential will be relentlessly eroded by trades until equivalent, or it's free money.
A dvc/fiat exchange, bank or investment fund might be a good idea. But they need to be subject to simple market forces and risk of loss like everything else. I'm not getting how a fund could be managed without reference to the market pricing you said was being avoided, except in just being a new market?