SolarCoin: The “GREEN” Bitcoin?

As a followup to my Bitcoin post, there is a new “solar energy” coin in the solar marketplace that operates much like Bitcoin. It is a coin in which people with solar panels can trade in their energy-saving certificates, which they receive monthly for feeding energy into the solar grid, for coins.  However, these coins are currently WORTHLESS in the market (unlike Bitcoin), but if it catches fire with solar panel owners founders say it can be worth $20-$30/coin. The problem is what incentive is there for someone to want SolarCoins? When comparing cash vs. SolarCoins, SolarCoins are not accepted everywhere, they do not store value nor are they a unit of account (i.e. prices of goods are not quoted in terms of how many SolarCoins it requires to buy).  Alternatively, cash does. The only thing that SolarCoin seemingly offers, like Bitcoin, is the money is unregulated and thus “untraceable”.

Okay, perhaps maybe there is another “benefit” of  SolarCoins… it is “green”.

Check out SolarCoins here: SolarCoin article in New Scientist

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4 thoughts on “SolarCoin: The “GREEN” Bitcoin?

  1. A currency is no longer the sole preserve of governments and their central banks. Bitcoin are the new approach. SolarCoin is a new digital currency. Digital coins are becoming more valuable than physical coins.

    • PrKralex, thanks for the comment. I want to address a few interesting points you brought up and hopefully add to the discussion about digital currency as a form of money. Digital coins are no more valuable intrinsically than metal coins (and in fact probably less since metal coins do have metal), but their market value is higher. Based on demand and supply, digital coins are returning more money than physical government coins today. So, I agree that they return more (and thus may be more valuable in the marketplace if you don’t account for risk and liquidity). However, currency is assumed to have a 0% rate of return which makes sense, because cash left in your pocket isn’t earning new cash. SolarCoin and Bitcoin ARE though. My argument is that they do not count as ‘money’ by the standard definition that money must have the following 3 functions: it must be a medium of exchange (it is because people are exchanging with it), it has to store value (not proven long term yet) and it has to be a unit of account (merchants represent the cost of goods in values of these digital coins–which has not wholly occurred). Rather, these digital currencies are serving as more of a derivative product or investment vehicle. It makes sense then that digital coins make more money for an individual, because they are competing in a different class of assets.

      Lastly, I am all for increased competition and if different forms of currency actually become money people use (must have all 3 functions of money to be considered money) than that is great! But, I am also skeptical that if something becomes too good the government will want to come in and regulate it.

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