Hi Steemians,
today i request to you resitance to read about that posts :-) !!
As interested european citizen I asked myself (that’s my opinion) why beginning of September 2017 the European Central Bank is saying , referring to the possible introduction of the Estcoin by Estonia Government, the euro is the only valid currency in Europe?
Why Estonia would not behave properly towards the European community by introducing Estcoin, based on Blockchain technology and on an ICO (Initial Coin Offering) related to the establishment of a sovereign wealth fund in Estonia for economic growth encouraging investment from any part of the world?
Why?
A governmental traditional currency ,like the euro , to be such, must have four essential requirements:
1)a central authority that beats that currency and by mandate in name of a nation or group of nations
2)Creating unlimited money supply of the currency by the central authority
3 ) Central banks may issue the money supply at will, to better manage the phases of the economy, and set interest rates re-discount for banks by adjusting the money supply
4)Decisions of the central bank monetary policy committees are independent from their pro tempore governments.
5)Traditional currencies are handled on currencies Stock Exchange
Comparing Cryptocurrencies with these four essential requirements for calling them governamental traditional currency there is :
a) No central body that govern their dissemination
b) Money supply of Cryptocurrencies are limited because, by definition , the total money supply is fixed at the time of emission through the ICO (Initial Coin Offering) .
c) Money supply of Cryptocurrencies cannot be changed , once the ICO is over.
d) No central Committee is in charge to control the regulation, rather it is founded on the consent of part of the web community.
e)Cryptocurrencies are handled on the Cryptocurrencies market cap.
Considering above mentioned structure of Cryptocurrencies they have not the characteristics of real world currencies, as they lack the 5 above requirements that define a traditional currency.
What are, therefore , the so called Cryptocurrencies? :
They are a virtual representation of a value inherent to any digital transformation project described in Whitepaper (basic design) that companies want to achieve or have already realized that uses established technology on blockchain for realising their products.
Ico’s target is for finding investors without going through the usual intermediaries (banks, investment banker, private equity funds etc), by finding such capital on the Web through crowdfunding with lowest costs (about 1% of the amount raised) describing their automated business model and their plan in the years to come in the Whitepaper..
So basically under every project, even that of a type of Bitcoin emission , whose usefulness is to issue a limited quantity of a digital encrypted hyper secure vehicle , on which to convey from one user to another the transmission of payments (so called Peer to Peer) , there is a description of the project and specific decisions on the type of digital transformation project that the company wants to implement over the years.
The so called Cryptocurrencies are not and cannot by definition be a real world Currencies but only a digital vehicle to give a value to the digital transformation project using the technology of Blockchain.
Staying on this level without going in the technicalities of Blockchain technology we ask ourself now again : why the European Central Bank is saying , referring to the possible introduction of the Estcoin by Estonia Government, the euro is the only valid currency in Europe?
Questions:
a) Are there risks that all transactions volumes (starting from US$ or Euro or whatever ) done by ICO’S are converted to virtual currencies and are from that moment outside central banks control ?
Answer a) Yes, actually it is converted in different (about 1000 ) cryptocurrencies in total a market cap of 169 Billion US $. This amounts are anymore under the control of the central banks/banks.
b) Loose the banking system profits by Blockchain based Cryptocurrencies peer to peer transactions?
Answer b) Yes, the whole banking system ,usual investors, traditional equity funds ectc. are totally out of the business
c) Is their existence threatened?
Answer c)Yes. if the central authorities do not regulate the cryptocurrencies market the virtualisation of the real world asset will be done without them.
d)the Blockchain technology systems is subversive about the current management structure of money supply?
Answer d)Yes, it is if not regulated the Cryptocurrencies will take over on long term the real world currencies (Mrs. Lagarde IMF) because the Cryptocurrencies are related to real value of projects.
e) it is inhibited the ability of the individual european economic systems within the euro countries to differentiate itself from the others?
Answer e)Yes, the Euro is inhibiting the differentiation of the european economies which are very different in their structure (let's say , as example, Germany is selling their product in Euro also if their production cost are 20 % to 30 % higher than Italy). There is no possibility to have a real competition between the economies.
Against these arguments there is one in particular that instead strengthens the position of the European Central Bank in saying that the Euro and the only valid currency in Europe.
It 's true: A Blockchain technology system works , actually, only if it is referred to a real world currency, it means that currently the US dollar is the main reference, in the case of Estcoin, would be the Euro.
No one can prevent the banks (UBS, CITI and others) to use their economic power to create platforms based on blockchain technology, as no one can prevent central banks to coin money and demand respect for the laws of official currencies and therefore is true that the Euro is the only valid currency in Europe.
But no one can, however, prevent companies or even governments to create platforms for exchange their assets whether they are virtual existing assets or activities in the real world by deciding to create corporate funds or also why not , “sovereign wealth funds “ which finance their own national projects, without having to pay all intermediaries as required today, taking in account their real cultural differences , historical and economic power and wealth .
Going back to the euro, the dollar, the renminbi or whatever currencies , they remain the official currency of these countries and are important, actually, for the functioning of the whole blockchain system.
Country platforms based on the blockchain technology become a solution when Governments, particularly in Europe, can fund own growth projects attracting funding from anyone who has faith in the goodness of the national project, which thank God, are different for each European Nation.
The Italian and Greek proposals, last Summer, to establish a parallel currency was incorrect because would de facto undermine the European monetary union.
But the proposal of Estonia is placed properly and does not break any laws because Estcoin is not a real world currency that substitute the euro but is the result of its national plans (Whitepaper) to set up its own sovereign wealth fund that relies on Estonia's projects and its national asset which virtualizes gives a value (Estcoin) in blockchain platform like any company is free to create their own procedures for self-financing with an ICO creating an own currencies.
It is not forbidden by any European law.
Conclusion:
The establishment of national blockchain platforms such as those that would be projected in Estonia and the establishment of a “sovereign wealth funds “ allows, even within the European union to differentiate themselves and thus attract investment, giving the opportunity to Estonia to differentiate their projects having a different value that would be based on the real parameters of the economy (inflation, labor costs, innovation etc.) in relation to the euro.
Especially Estonia Government has the right, as worldwide Number 1 in digital transformation in Blockchain technology , to go ahead with their plans as their are extremely competitive benefiting from their advances.
The creation of such Blockchain digital platforms as “sovereign wealth funds “ would establish , to sustain the euro, a basket of virtual values of the projects of the individual economies of the European community representing their true relative strengths.
Maybe European Central bank fears? :
It would be a dangerous precedent because ,it would come out, the real situation of the individual economies. despite their objective different competitiveness, they are entangled in the euro and must export their goods and services to a more higher value of how economic parameter between the real economies of the European Community countries justifies.
Only from this point of view is understandable the hardline position of the European Central Bank regarding Estcoin (because it is not an official currency).
I therefore hope that the digital transformation of today and the next few years including blockchain tech will change for the better Europe specifically eliminating economic distortions that have been created through the introduction of the euro, which equalized the European economies, that are highly inhomogeneous , both for their characteristics and for their culture
Welcome are , in my opinion , blockchain governmental platforms related to the euro that highlight these differences of the economies of the european nations.
Europe must become, as intended by the european founding fathers "United in the diversity."
Forza Estonia ......Forza Estcoin….
If you had the perseverance to read until here please VOTE the article :-)
For the hardliner who want to read ahead::
Estonia made in the last 15 years heavy investment in the digital structure advancing to the Numero 1 digital government worldwide.
Their digital structure is so advanced and robust that they decide to introduce their e-residency program for stranger entrepreneur from any country that want to establish companies in Estonia without visiting the country, only through government digital processes (One day procedure with lowest costs).Their long term target is to reach 10 million e-resident.
No country on the world as such a project that is so supported through long term investment and advancement.
You can see Estonia realized digital structure and their future program which is very huge under https://e-estonia.com/
Why Estonia should not call an ICO on his national projects planning which under other projects foresee an Estonian worldwide government blockchain network ?
Why should investor and e-residency interested people not have the possibility to invest in the country project if they establish in Estonia their own company?
What has this to do with the Euro?
Nothing is more destructive of respect for the government and the law of the land than passing laws which cannot be enforced.
- Albert Einstein
right @wise-old-man!