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Smartcoin Proposal: bitXDR (Special Drawing Rights)

in bitshares •  2 years ago

I must begin this one by clearly stating that I am not a big fan of either the IMF or globalism. Local institutions and local government already infringe deeply and often on personal freedom, and for the life of me, I cannot see how compounding the size of government and governmental institutions is going to do anything but accelerate that process (recent example).

With that out of the way ..

Being a pragmatic man, I believe there is one of their machinations that we can take advantage of.

I speak, of course, of the SDR (actually, XDR).

You might have heard of it before. If not, I compiled a quick list of facts for you to skim over -- see below.

Key facts

One-paragraph description (from Wikipedia):

Special Drawing Rights (ISO 4217 currency code XDR, also abbreviated SDR) are supplementary foreign exchange reserve assets defined and maintained by the International Monetary Fund (IMF). The XDR is the unit of account for the IMF, and is not a currency per se. XDRs instead represent a claim to currency held by IMF member countries for which they may be exchanged. The XDR was created in 1969 to supplement a shortfall of preferred foreign exchange reserve assets, namely gold and the U.S. dollar.

On the value of the SDR:

The value of the SDR in terms of the U.S. dollar is determined daily and posted on the IMF’s website. It is calculated as the sum of specific amounts of each basket currency valued in U.S. dollars, on the basis of exchange rates quoted at noon each day in the London market.

On the dynamic composition of the basket:

The basket composition is reviewed every five years by the Executive Board, or earlier if the IMF finds changed circumstances warrant an earlier review, to ensure that it reflects the relative importance of currencies in the world’s trading and financial systems. In the most recent review (concluded in November 2015), the Executive Board decided that, effective October 1, 2016, the Chinese renminbi is determined to be freely usable and will be included as a fifth currency, along with the U.S. dollar, euro, Japanese yen, and pound sterling, in the SDR basket.

Why bitXDR?

For savers, especially those outside of so-called first-world countries, Bitshares represents an incredible, and as of now mostly undiscovered, potential: one can very easily hold assets on-blockchain, which tracks the value of any major world currency.


what if they had known about bitUSD?

While personally I am more of a fan of holding #bitshares, #bitcoin, #monero, and -- of course -- dogecoin, it would be foolish to be 100% (or close to 100%) invested in what still amounts to wonderful experiments.

In other words, I do not trust fiat currencies so much for the time being, but it is still wise to not be mostly invested in crypto-assets that do not track them.

That is my opinion, anyway.

To tackle the central question of this section, why hold bitXDR instead of bitUSD, bitEUR, bitCNY, and so forth?

Consider this:

In the review conducted in November 2015, the IMF decided that the Renminbi (Chinese Yuan) would be added to the basket effective October 1, 2016. From that date, the XDR basket will consist of the following five currencies: U.S. dollar 41.73%, Euro 30.93%, Chinese yuan 10.92%, Japanese yen 8.33%, British pound 8.09%.

bitXDR, then, represents an interesting way to diversify in the context of crypto-fiat.

Conclusions

Adding bitXDR may not just add an interesting hodling option for more financially-conservative bitshares users.

Done right, it could also attract a lot of publicity to the system. Consider the following facts:

XDRs are allocated to countries by the IMF. Private parties do not hold or use them.

That is ...
Until Bitshares!

MakerDAO, of course, aims to do something similar (well, kind of) - with proper liquidity, and with STEALTH arriving before the end of the summer, it seems to me that there is more than enough room for some healthy competition here.

Add to that the fact that the bittwenty index fund is nearly launched, and we would have two very interesting assets to hodl indeed, on the Bitshares blockchain.


Links

Bitsharestalk thread
SDR on Wikipedia
SDR Factsheet
XDR/EUR exchange rate

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BDR! this is needed!

Stealth is not arriving before the end of summer. Summer ended a couple weeks ago. We are just now formalizing the team that will be finishing the Stealth project.

As for bitXDR, I am definitely for it. Whatever the new world currency is going to be, the Amero, Phoenix, CNY, whatever, it is good to have a Bitshares Smartcoin pegged to it now, this way we can start bringing on more Smartcoin Exchanges around the world who will trade the bitXDR to fiat XDR and of course enable people immediately to be able to spend the new currency at any BlockPay merchant around the world. Instant economy. Plus, buying up some of it early might be a good investment.

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Looking forwards to easy/default stealth in BTS - the massive increase in value of Monero shows just how important privacy is to users.

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Me too.

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Stealth is not arriving before the end of summer. Summer ended a couple weeks ago.

Of course, but I could not help injecting some good old Bitshares humor into it!

As for bitXDR, I am definitely for it.

Fantastic! Let's move this forward.

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Summer ended a couple weeks ago

Nope.

i think it's a good idea to have a BitSDR. SDRs seem to be the way things are moving in the longer term. I would support it

Although I think this is a great idea my only fear is that there will be liquidity problems as in every other mpa.

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Adding it should be fairly trivial, whether it sees adoption or not is a different story.

But I think one way or the other, XDR will become more relevant, adding it to Bitshares is a very interesting (if a bit sneaky - it was not made with personal hodling in mind) way to use this "currency".

There is a similar try from Chinese community, that was founded by @James Gong, please take a look at https://dacx.com/ , where you can buy BDR.
However, it was only popular at the beginning, then people lost interests. I guess the main reason is that people can always find other ways to invest xDR, Bitshares is not the only choice.
IMO, the first priority is to find more application for bitUSD. When the market cap of bitUSD is big enough, then everything will be easier.

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Where else can you buy SDRs?

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DACX is ready for SDR market all the time. They didn't because due to their research, the volume will be low.

Great idea! I am for it.