Its good to have goldmoney open, another monetary base provider for the
gold economy.
The differences are:
1. Lower metal storage fee (0.5% p.a. vs 1% p.a., deducted at spend (or
monthly in absence of a spend) vs monthly)
2. different spend fee (0.1% vs 1%, 1 AUG vs US 50c, payer vs payee)
This makes the product better for passive holdings and for
micro-transactions but worse for larger payments and active holdings.
Given that services are available for transactions within Standard Gold
and metalsavings and using digigold without cost at all, people making a
lot of transactions may migrate to those currencies. Also those offer no
storage fee or in one case interest earning. However they all also
involve financial risk as they are supported by earning reserves of
loaned/invested funds.
I predict that e-gold and goldmoney will be used mainly as monetary
bases and not for transactional use, and that transactional use will
migrate to storage and transaction fee free currencies. This would seem
to favour goldmoney or may force e-gold to drop its agio fee, assuming
that use of metal as a monetary base is a largely passive holding.
Alternatively, gold based currencies could bypass e-gold and goldmoney
and hold physical gold themselves with repositories. This makes e-gold
and gold-money highly contestible and will drive fees toward costs. I
believe Standard Reserve, Metalsavings and Digigold will increase in
dominance for personal use, with individuals using Standard Reserve for
liquidity, ATM withdrawal and account based services, Digigold for
maximum privacy and metalsavings (and its competitors) for, obviously,
interest earning holdings.
So far I have not been able to find out the structure of goldmoney. This
will need to be provided to enable goldmoney to compete with e-gold as a
monetary base.
For goldmoney to take off it needs a bigger and better system of
in-exchangers. If in exchangers accept e-gold for goldmoney then users
need a significant benefit over e-gold to be bothered with the second
conversion. But gold-money is on the back foot because of the large
network of in-exchangers for e-gold and the large pool of e-gold users.
It seems that it can only compete for large users (i.e. gold based
currencies) wanting a non-financial based on price and security.
Goldmoney seems in a poor position to compete with e-gold based
currencies because it is to similar to e-gold.
David Hillary
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