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Comment by ur-whale | Hacker News Reader

Maybe this? :

https://en.wikipedia.org/wiki/Local_currency

"aims to encourage spending within a local community"

But you don't need cryptocurrencies for a local currency. In fact, you better not use one because you don't need the distributed part of it, and you definitely want to be able to control the money supply. A centralized electronic system or a paper-based system are all you need. Or maybe use Taler[1] if you want some cool tech with bleeding edge cryptography.

[1]: https://taler.net/en/

And in those cases there could be censorship and manipulation you're not aware of.

Of course, but a city-scale crypto would be centralized anyway: it couldn't be PoW because a 51% attack is way too easy, and in a PoS scheme, the city council (or their technical support company) would almost certainly keep the majority of stakes for themselves.

They would most likely be ERC-20 tokens built on the ethereum chain. So you inherit the security of the main chain.

Also, they don't necessarily need to be centralized. The currency could be run via a DAO and changes to the currency could be voted on.

I guess what I'm getting at is through what mechanism. I can already buy every single thing available in my local community with American currency. Why do the tokens improve this situation?

Local currencies are a thing since the middle age. They allow for a distinct set of rules (=! Inflation rate) governed by “local” representatives. In strong economies (like g7), it does not make much sense, granted.

You may lose on the exchange processes vs “the global currency”, but your community may not care since aiming to trade locally.

PS : in constant inflationary economies (read Argentina, i think 600% in 10y), crypto is mainstream now for regular Joe's. Stable coins are all the rage to fight inflation.

Stable coins are all the rage to fight inflation.

'Regular Joes' call them dollars, they exist as pieces of paper you can hold in your hand. They don't need to play silly games with crypto scammers.

- Do you know what currency controls are? - it's the government telling how much you can have of those dollars - it's the government mandatory currency conversion to local currency when receiving dollars from outside the country. Gvmt keep the dollars and hand you local currency (that one that is loosing value by the day)

Yes. Countries not using dollars are exposed to conversion risk and potential shortages of hard currency. People whose native currency is the US dollar are not exposed to this risk, which is why all the inflation hawk stuff tends to look silly.

Holding cash during inflationary periods doesn’t fight inflation. Your dollar becomes less valuable.

As the other commenter noted , I think you are misunderstanding what a stable coin is. A usd stable coin entitles you to one dollar. The same way a dollar bill entitles you to one dollar. You can use both of them to try to get further yield but they both entitle you to a dollar.

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