Long before the specific formal appearance in the Literature¹ʻ², conflicts between open & closed markets were apparent & dealt with. The dilemma didn't go away, they relied on the difficulty >
/2
Removing that standard shifted the dilemma for them, but we're concerned w/the citizen markets of nations. Suffice it to say, >
/3
@GeorgeSelgin@lawrencehwhite1@jp_koning - #banknotes as bearer instruments were no longer redeemable for anything other than goods & services in regulated mkts, subject to consumer protection laws, etc.
The other hole in the supposedly closed system was addressed in 1982³. Note that I've purposefully highlighted >
/4
@GeorgeSelgin@lawrencehwhite1@jp_koning several other elements here to underscore that this is a #complex problem, & cannot be answered by a single linear stance such as "but it's not expressly forbidden".
We're seeing a related ongoing debate regarding regulation of #McCrypto (Wall St version), & the conclusion >
/5
Bearer instruments categorically share components that require similar #regulation, so the same reasoning applies to all.
In the tight margin of issue/redeem liquidity, >
/6
@GeorgeSelgin@lawrencehwhite1@jp_koning - failures stem from tiny changes in conditions (far from #equilibrium state), so the (US) eliminating tax deductions as well as imposing 1% excise tax on bearer obligations³ʻ⁴ killed the practice of issuing them as a viable business model. Other countries have direct bans.
>
/7
So while there is no 'outright ban' on things like private banknotes, #bitcoin, or "token stocks", neither is one needed, as every necessary component of them has been corralled into #compliance.
>
/8
@GeorgeSelgin@lawrencehwhite1@jp_koning Notes:
¹ Gold & Central Banks, Młynarski, 1929
² Gold & the Dollar Crisis, Triffin, 1960
³ Tax Equity & Fiscal Responsibility Act of 1982
⁴ FDIC Trust Examination Manual, Sec 11
⁵ Patriot Act, Title III (amended Money Laundering Control Act of 1986, Bank Secrecy Act of 1970)
This sword cuts both ways: the same ambiguity that emboldens innovators to imagine themselves a step ahead of law won't convince enforcement & courts that existing laws don't apply.
@FrankPasquale What I'm not seeing enough unpacking of, is the word 'data'.
What data? Without more detail, this cannot possibly be adequately broken down & understood, thereby proving useful to the task at hand.
The more general approach is via Information Paradigm: I/O = Time value (data=$)
@FrankPasquale Some i/o action we call 'work', and associate with a cost. Other work may not be. Some work we want to record, as it contributes to our Experience & Reputation, which are multipliers of T_v. The default choice should lie with the creator, or as an agreement between them & others.
@FrankPasquale The other part is the level of certainty of an ID. Take note from physics, as we went from 2D, to 3D/t, to 6 points in Space, to 10 dimensions of Spacetime. The lack of numerous verifications = pseudonymity. Only unique combinations reveal ID. Can collect generic info privately.