GoreBank and Tahoe's Introduction to Foreign Currency Exchange

GoreBank will work in the exact way that RegiBank works. See this thread here FIRST to understand RegiBank. Please and thank you.

http://www.xsyon.com/showthread.php/...urrency-issuer


However, we use a different commodity, and a different currency. We do keep RegiDollars and Old Saw Blade in stock in case Reginald is unable to make withdrawls or deposits, you can also exchange with Goretooth.

Creating a 2nd currency that is tied to a different commodity creates the potential for a foreign exchange market. Where currencies can be traded vs each other, based on the markets supply/demand for one or the other commodity. Profits will be able to be made by those who are knowledgeable about the market and can make good trades, but these profits will never come in an increase of currency. They will come in the result of an increase in labor, or items, or whatever you traded for and got a good deal.



Just like Reginalds bank, this will be 100% backed, and no currency creation loans will be made.


The currency is Bottlecaps Found by Goretooth. The commodity is 20VHQ nails of any type.
We will call the Goretooth Bottlecaps --- GBC. Goretooth Bottlecaps.

The next currency is Beertabs Found by Goretooth. The commodity backing these will be 20VHQ screws of any type. We will call the Goretooth Beertabs --- GBT.

The last currency is Buttons Found by Goretooth. 10 of them for everyone 1 shovel.
The commodity backing these will be any quality and durability shovels.
We will call the Goretooth Buttons --- GBU.


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It will become common knowledge across the lands that 1 GBC is always good for 20VHQ nails, if you trade with Goretooth it is guaranteed. Same goes for the rest of the currencies.

At any time I am online you can come to me and withdraw VHQ nails for GBC.

The gore bank is located zone 818, position 1000,420. It is the little island just north of the big island in the south of the lake. It now has a bridge attaching to the main land.

http://i48.tinypic.com/35jbk29.jpg

Remember, you can also use the services of the RegiBank at the GoreBank.


I strongly urge you to read the thread about RegiBank if you have not already. It explains in great detail many things you need to understand about this monetary system.


The GoreBank and RegiBank will not trade currencies between each other. The reason for this is that we do not want to influence the exchange rate of GBC vs R$, the GBC vs GBU and the other potential crosses. We want that to be all up to the rest of the players who do not have issuing power over the currency.

We want this market to be extremely fair. If you are not trust worthy as a currency issue, the market will destroy you, that is for sure.

That's why fractional reserve (dumping more paper on the market than commodity is on deposit) will never, ever be used. The GoreBank and RegiBank will never dump our currency onto the market in exchange for any other item than the fixed amount of commodity we have backing the currency.



The foreign exchange aspect of two currencies may take a while to get going around the world, or it may not happen at all as the currencies will likely lack strong fluctuation. Still, it is good to open another bank and another currency.

Good luck.

I want to point out to anyone that does think about using this, dont forget that Goretooth can always just scav as much BC's as they want an set the rate however, they wish. So you will only have BC to VHQn.

Quote:

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Originally Posted by MrDDT

Good luck.

I want to point out to anyone that does think about using this, dont forget that Goretooth can always just scav as much BC's as they want an set the rate however, they wish. So you will only have BC to VHQn.

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This is true. Just like real life. However Reginald and I certainly aren't out to destroy the game (people always have that thought, and of course its possible). We are taking time out of our lives to provide this service, for no cost whatsoever. No interest, we simply make the transactions (deposits/withdrawls)happen at a fixed rate.

The only way to make the system better is to have the devs or guides always be online and able to exchange. Why? Because this way you know for a fact there will be no hidden inflation. Rates will never be changed. Currency never dumped onto the market (breaking the 100% backing and creating a fractional reserve system).

This would be more or less perfect.

The problem is, I don't think Jordi wants the devs or guides to run anything like that. He wants the economy to be player run. And I really like this.

No one should ever go too heavy into a currency, and certainly never for a long amount of time. It would always be wisest to redeem your commodities from the bank ASAP, for you never know what is going to happen to a certain currency (hell the player could die in real life, and that would ruin the system if his account was not taken over and maintained by the guides).

This is another reason why, the more currencies the better, and the more people using the system, the better. Once it takes off its hard to get people to lose faith in it. This would especially be the case in a currency that never loses value (such as a 100% backed and fixed commodity currency)

The U.S. dollar has lost 96% of its 1776 value and people still know that USD is KING (although this could end if oil was exchangeable for other currencies than USD). Everyone knows it will buy what it bought yesterday, and its exchangeable for pretty much anything.

The psychology more than anything else is what holds everything together. A currency can pretty much inflate to infinity (until numbers become incomprehensible such is the case in Zimbabwe) and still be "psychologically strong"

Just to be clear, I would not at all be opposed to guides running the system.

It would be flawless, so long as we can trust the guides not to do any manipulating with their non guide player accounts.

This system can never not be based on trust.

Unless we use NPCs of course. That = hard coded perfect system.

We already heard that there is going to be no NPCs.. things can change but I think Jordi is quite firm on this.

Easy for players to do, as I've done it before.

Use a currency that can be used whether or not you back it. Like nails, screws, rivits, rocks etc

Of course DDT, nails work to a point because they are decently light. But there is still not banks offering fixed value exchange rates. The more regional, and the more of them that there are, the stronger the currency will be.

Rocks are a terrible currency I'm sure you know why.

The point of this system is to make it very easily exchangeable, and to have guaranteed exchanges. Yes nails are easily exchangeable due to being light, but unless you are using a cart, you aren't going to go around carrying much more than 10k nails. Especially if you are not a high STR player.

I like the idea of a second bank system in Xsyon. I hope it picks up and will be sure to contribute in word and in action everywere I can. Thumbs up for the idea!