On Wednesday, May 28, 2003, at 11:15 AM, Danny Van den Berghe wrote:
...Oh, you could create repudiable e-gold for example.
There is a far bigger market for repudiable payments than for non repudiable.
Creditcards have of course already taken up on it, but because merchant accounts are
still difficult to get for people in many countries, and their fees are pretty high
as well, there is probably good opportunity for a gold backed repudiable payment
system.
I don't think that simple payment escrow with expiration times will do the trick. I think the solution, if there is any, will in effect BE a credit card. In other words, the issuer will maintain the credit risk, suffering the occasional default and adjusting interest rates and other fees accordingly. The issuer will be LOANING money.
It would be a digital credit card, with no piece of plastic mailed out. To satisfy the ignorant masses (your main market), payments could be ACH or mailed check or money order. But you could also offer a steep discount for payments made with e-gold, 1mdc, e-bullion, Pecunix, or Goldmoney (since your paperwork and risk would be cut dramatically). This could take the form of a retroactively lower interest rate for all balances or portions thereof paid in digital gold currencies.
Obviously each merchant accepting payments this way would have to set up a merchant account, and at various times the issuer would have to settle these accounts, paying the funds out to the merchant in the form of check, bank wire, or who knows, maybe even DGC.
I would like a solution that did not tie in to the existing credit system, and I see no particular reason why you would have to. The big hurdle to overcome, however, would be trust and acceptance by the merchants. I don't think customers would have any problem adopting it, since they don't really have to trust the issuer to use the system -- on the contrary, the issuer has to trust the customers.
-- Patrick http://fexl.com
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