>We can therefore see that someone has to make that "worth" mean 
>something, so for this we need an "issuer" sometimes known as Ivan. 
>It's beyond the scope of a crypto list to discuss this in depth, but 
>typically Ivan would deposit $1 for every issued electronic dollar in 
>some bank account somewhere.

You're right, for a crypto currency to be credible in the long term,
it needs to be convertible into Real Money(tm), i.e., something you
can use to pay your taxes.  (That's the actual working definition of
money, by the way.)

But that really has nothing to do with the crypto part.  You can have
crypto out the wazoo, and it's worth nothing unless there's an issuer
in meatspace who will accept your crypto coins, cancel them, and hand
you the agreed amount of money.  Or think about the ETF model I
suggested a few years ago, which provides a close approximation to
convertibility without requiring that the issuer be able to redeem
every individual coin on demand.

John Levine, jo...@iecc.com, First Unitarian Society of Ithaca NY
Between 200 and 500 members, depending on who's counting

PS: For anyone who wants a crypto currency backed by gold, that's
functionally equivalent to a gold ETF, of which there are several,
such as ticker symbols IAU, GLD, GTU, SGOL, and AGOL.  They do what
they do perfectly adequately, but they are in no sense currency.
Bubble sceptics can trade put options on them.  Too bad there's no
options on bitcoins.

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