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Back to the Future

A New Money for a Changing
World
The Internet is changing the nature of commerce
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A New Money for a Changing
World
The Internet is changing the nature of commerce
Existing currencies have burdensome costs
A New Money for a Changing
World
The Internet is changing the nature of commerce
Existing currencies have burdensome costs
A new currency is needed for the Internet
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A New Money for a Changing
World
The Internet is changing the nature of commerce
Existing currencies have burdensome costs
A new currency is needed for the Internet
The Internet needs a common currency
Comparing the I nternet and the
Automobile
A message from those early, first cars
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Comparing the I nternet and the
Automobile
A message from those early, first cars
An invention so profound that it fundamentally
changes what previously had been accepted as
dogma
Comparing the I nternet and the
Automobile
A message from those early, first cars
An invention so profound that it fundamentally
changes what previously had been accepted as
dogma
It took time for the modern automobile to emerge,
but transportation was altered forever
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The I mpact of the I nternet
A profound invention
The I mpact of the I nternet
A profound invention
fundamentally changing how we buy/sell goods and services
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The I mpact of the I nternet
A profound invention
fundamentally changing how we buy/sell goods and services
A global scope
The I mpact of the I nternet
A profound invention
fundamentally changing how we buy/sell goods and services
A global scope
the barriers at national borders are diminishing
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The I mpact of the I nternet
A profound invention
fundamentally changing how we buy/sell goods and services
A global scope
the barriers at national borders are diminishing
Internet currency today is like those first cars
The I mpact of the I nternet
A profound invention
fundamentally changing how we buy/sell goods and services
A global scope
the barriers at national borders are diminishing
Internet currency today is like those first cars
Who will be the buggy-whip makers of the 21st
century?
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Evolution of Currency
Evolution of Currency
Metal accepted by
weight
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Evolution of Currency
Metal accepted by
weight
Coins of set weights
Evolution of Currency
Metal accepted by
weight
Coins of set weights
Refinement of coins
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Evolution of Currency
Metal accepted by
weight
Coins of set weights
Refinement of coins
But still burdensome
Evolution of Currency
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Evolution of Currency
Creation of the Bank of
England in 1694
Evolution of Currency
Creation of the Bank of
England in 1694
Metal/coins remained in
storage
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Evolution of Currency
Creation of the Bank of
England in 1694
Metal/coins remained in
storage
Paper circulated in
place of metal
From Money to Money
Substitute
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From Money to Money
Substitute
Asset Liability
From Money to Money
Substitute
Asset Liability
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Limitations of Asset Currency
Difficult/cumbersome to move around
Limitations of Asset Currency
Difficult/cumbersome to move around
This limitation is overcome by the Internet
because:
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Limitations of Asset Currency
Difficult/cumbersome to move around
This limitation is overcome by the Internet
because:
the asset remains in storage
Limitations of Asset Currency
Difficult/cumbersome to move around
This limitation is overcome by the Internet
because:
the asset remains in storage
the ownership of that asset changes to enable it to
circulate as currency
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Limitations of Liability
Currency
Funding - keeping balance sheets in balance
Limitations of Liability
Currency
Funding - keeping balance sheets in balance
Payments have Herstatt risk
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Limitations of Liability
Currency
Funding - keeping balance sheets in balance
Payments have Herstatt risk
Liabilities are someones I.O.U.
Limitations of Liability
Currency
Funding - keeping balance sheets in balance
Payments have Herstatt risk
Liabilities are someones I.O.U.
Promises to pay are inferior to assets used in
payment
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Limitations of Liability
Currency
Funding - keeping balance sheets in balance
Payments have Herstatt risk
Liabilities are someones I.O.U.
Promises to pay are inferior to assets used in
payment
These limitations cannot be overcome by the
Internet
The Payment Process
Customer A Customer B
$100
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The Payment Process
Customer A
Citibank
Customer B
$100
$100
The Payment Process
Customer A
Citibank
Customer B
$100
Clearing &
Settlement
$100
$100
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The Payment Process
Customer A
Citibank
Customer B
Deutschebank
$100
Clearing &
Settlement
$100
$100 $100
The Payment Process
Customer A
Citibank
Customer B
Deutschebank
$100
Clearing &
Settlement
110 $100
$100 $100
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The Payment Process
Customer A
Citibank
Customer B
Deutschebank
$100
Clearing &
Settlement
110 $100
$100 $100
GoldMoney
9.800gg
The Payment Process
Customer A
Citibank
Customer B
Deutschebank
$100
Clearing &
Settlement
110 $100
$100 $100
GoldMoney
9.800gg 9.800gg
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The Payment Process
Customer A Customer B
$100
GoldMoney
9.800gg 9.800gg
Gold as Money
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Gold as Money
One Barrel of Crude Oil in US Dollars
December 1945throughMarch2002
50 55 60 65 70 75 80 85 90 95 00 05
1
2
3
5
10
20
30
50
GoldMoney.com
LogScale
Crude oil price rises
Gold as Money
One Barrel of Crude Oil in US Dollars
December 1945throughMarch2002
50 55 60 65 70 75 80 85 90 95 00 05
1
2
3
5
10
20
30
50
GoldMoney.com
LogScale
Crude oil price rises
One Barrel of Crude Oil in GoldGrams
December 1945throughMarch2002
50 55 60 65 70 75 80 85 90 95 00 05
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
GoldMoney.com
Crude oil price static
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Conclusions
Conclusions
300-year old process of clearing & settlement does
not work well on the Internet
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Conclusions
300-year old process of clearing & settlement does
not work well on the Internet
The process itself is outdated
Conclusions
300-year old process of clearing & settlement does
not work well on the Internet
The process itself is outdated
Asset currency circulates efficiently in ecommerce
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Conclusions
300-year old process of clearing & settlement does
not work well on the Internet
The process itself is outdated
Asset currency circulates efficiently in ecommerce
24/7/365, instantaneous, non-repudiable & low-cost
Conclusions
300-year old process of clearing & settlement does
not work well on the Internet
The process itself is outdated
Asset currency circulates efficiently in ecommerce
24/7/365, instantaneous, non-repudiable & low-cost
The history of money presents the development of
more efficient currency
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Conclusions
300-year old process of clearing & settlement does
not work well on the Internet
The process itself is outdated
Asset currency circulates efficiently in ecommerce
24/7/365, instantaneous, non-repudiable & low-cost
The history of money presents the development of
more efficient currency
Therefore, asset currency will emerge as the
preferred currency in cross-border ecommerce