One of the big differences here is that the "currency competition", particularly prior to the 1860s, was still trying to leverage the same basic semantics.
Both legitimate and questionable issuers were both claiming to supply "dollars", either directly or as an IOU for government-issued ones. There was consumer confusion baked right in, and probably to the great benefit of dishonest players. Some privately issued coins during the gold rush were a bit underweight, and a lot of private paper currency traded well below face value. A whole system of newsletters and discounting rates evolved to document exactly whose "dollars" were legitimate.
A new currency competition environment in 2021 has this sort of awareness built in. We're not in a newly cleared Homestead Act town dealing with stopgap measures for a lack of government issued currency. Anything but a FedCoin, even a Tether-style linked product, is clearly a private product and has a documented exchange rate. There isn't the same "information travels slowly in 1860" gaps to keep fraudulent products afloat.
I wonder how much of the interest in alternative currencies was based on hoping to exploit that sort of timing gap. The existing ones that don't have a built-in exploit system-- the "labour pool" ones denominated in hours, the "keep the money local" closed-loop currencies, don't seem to get huge momentum beyond local enthusiasts.
In a way, the current crypto FOMO mania smells of similar "trying to stay ahead of the information flow" plays. It's less that the issuers are hoping to pass 80 cents of gold as a dollar, but more speculators buying them at 40 cents, not really knowing what they're actually worth, but hoping they will settle at 80 some day. I wonder what happens once prices stabilize-- will interest fade away if they're back to competing on technical merit rather than the possibility of moonshot gains?
Both legitimate and questionable issuers were both claiming to supply "dollars", either directly or as an IOU for government-issued ones. There was consumer confusion baked right in, and probably to the great benefit of dishonest players. Some privately issued coins during the gold rush were a bit underweight, and a lot of private paper currency traded well below face value. A whole system of newsletters and discounting rates evolved to document exactly whose "dollars" were legitimate.
A new currency competition environment in 2021 has this sort of awareness built in. We're not in a newly cleared Homestead Act town dealing with stopgap measures for a lack of government issued currency. Anything but a FedCoin, even a Tether-style linked product, is clearly a private product and has a documented exchange rate. There isn't the same "information travels slowly in 1860" gaps to keep fraudulent products afloat.
I wonder how much of the interest in alternative currencies was based on hoping to exploit that sort of timing gap. The existing ones that don't have a built-in exploit system-- the "labour pool" ones denominated in hours, the "keep the money local" closed-loop currencies, don't seem to get huge momentum beyond local enthusiasts.
In a way, the current crypto FOMO mania smells of similar "trying to stay ahead of the information flow" plays. It's less that the issuers are hoping to pass 80 cents of gold as a dollar, but more speculators buying them at 40 cents, not really knowing what they're actually worth, but hoping they will settle at 80 some day. I wonder what happens once prices stabilize-- will interest fade away if they're back to competing on technical merit rather than the possibility of moonshot gains?