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The Decentral Bank

One question is left for a decentralized monetary system: can you replace the central authority that creates and annihilates money according to the actual needs to keep it circling, with a decentralized system?

Central banks give money to banks, in form of credits. Banks give that money to their customers, in form of credits. The idea behind that is that in order to produce goods that are finally consumed, you need to invest up-front, buy the incredients, spent money on the work, and finally, when the good is sold to the consumer, you can pay back your credit, and share your profit with the creditor (the interest rate). The central bank doesn't quite need you to share the profit with them, so their interest rate is more a control instrument than a profit tool; they can also issue money with negative interest rates.

So in fact, the system is already somewhat decentralized: The central bank outsources the job to evaluate the actual credibility to banks. This gives a lot of power into their hand, and it favors big credits over small credits (there, the effort for verifying the credibility is small compared to the overall profit). Even further: Since the banks have their own need for money (their Ponzi-scheme department, also called „investment bankers“), they prefer to give the central bank's money to that department, and it creates stock bubbles, real estate bubbles, or even BitCoin bubbles. Real funding of promising businesses doesn't happen.

So this sort of funding doesn't work that well for the internet age, which is why crowdfunding has been invented. The idea here is that many people give small credits, and really receive the mass-produced good when it's actually produced (so unlike futures, the contract itself is not tradeable). The missing point is that the central bank doesn't step in and gives the crowdfunder credits, so that they could crowd-fund with a lever.

And so that's the decentral bank: It's a crowdfunding system, where people have to sign for the risk of the fund, but not for the actual money — they get a credit for that, and only part of the money paid upfront has to be their own. Once the project is finished, they have to pay the full amount to actually get the product they ordered, but that way, the money needed for circling between funding and production can be created as fiat money.

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