Auroracoin, an Icelandic cryptocurrency, has nearly doubled in price over the fresh round of scandals revealed in the Panama Papers. Cointelegraph spoke with developers behind three regionally-centric cryptocurrencies (Auroracoin, Sterlingcoin, and Scotcoin) about their vision for modern currency designed for their respective peoples.
Dissatisfaction with financial system
Cryptocurrencies created for a specific people can save them from the central banking system.
Recent scandals unearthed by the Panama Papers leak demonstrate corruption and hypocrisy from public officials, as well as a banking and governance system that serves the 1% at the expense of the poor and leaves the rest at a disadvantage. This has led the citizens of many countries to feel disenfranchised, even prompting a prime minister turnover in Iceland.
Dissatisfaction with the way financial systems have been handled, as well as a simple desire to create something of value for a people, has given rise to a number of cryptocurrencies designed for a specific people.
Most notable of these is Auroracoin, an Icelandic cryptocurrency created a few years after the county’s first great banking scandal, and has nearly doubled in price over the fresh round of scandals revealed in the Panama Papers.
Giving cryptocurrency a local flavor
A goal in creating a regional coin, according to lead Scotcoin developer Derek Nisbet, is to make the concept of cryptocurrency palatable at a local level.
“While Bitcoin and other leading cryptos are a true innovation for the global community, my feeling is that there are massive opportunities for 'local' cryptocurrencies, which directly impact and assist a community within smaller geographic areas. I don't see any reason why every local community could not have their own 'local' crypto, trading with BTC, Scotcoin & others, in the future.”
Steven Saxton, developer of Sterlingcoin, believes that a cultural branding can help a cryptocurrency to gain adoption in ways a more general-purpose coin like Bitcoin may not.
“For a currency to survive, it needs people to agree it has value. Using cultural bounds seems as a very strong glue to hold these communities together and the currency flowing. This glue will surely outlast fads of being simply something new. People are very tribal, it makes sense that currency is and will continue to be.”
Disseminating cryptocurrency in a focused group
Iceland provided a perfect test case for cryptocurrency, as there is currently no easy way for its citizens to acquire Bitcoin. According to Pétur Árnason, Chairman, Auraráð foundation, this gave Auroracoin an edge in adoption.
“No cryptocurrency in the world has been spread wider within a single nation than Auroracoin has. Not even Bitcoin can claim that.”
Hlynur Þór Björnsson, board member of the Auraráð foundation, concurs, stating that “10% of Icelanders claimed the coins in the airdrop, which makes it one of the most distributed coins out there.
He also added:
“If It won't work here, where we have all the right reasons for adopting crypto, where else in the world will it work.”
Cryptoequity for a people
The idea of creating cryptoequity, not around a company but around a nation, was central to the idea of Scotcoin, according to Nisbet.
“This was my plan from the outset, to 'helicopter' in a new medium of exchange that can directly assist the Scottish people, for the future.”
This idea rings even more true for Auroracoin, as it was created for a country with a historically shaky currency and banking system. According to Árnason, it would create a new, and better, monetary system.
“The monetary system we live with now enslaves the nation just as it does with the rest of the world. That is why Bitcoin was created. The Icelandic nation has just been heavily burned by the fatal flaws of modern age banking, in other words money printing. What better gift to give our children than a monetary system that will not skin them to the bone like our current system has done to us and the generations before us. Iceland has everything to gain by parting with the cancer we call a monetary system. Is Auroracoin the solution? Be it the solution or not, it is a step in the right direction and is a hell of a lot better than what we live with now.”
An escape from government corruption
The creation of cryptocurrencies for nations to use allows for an alternative to a system that recently was shown to serve the global elite rather than the people. According to Saxton:
“I think the Panama Papers leak will demonstrate to people the power Sterlingcoin and other public ledger technologies bring to accountability through transparency in finance. Gerard Ryle, the director of the International Consortium of Investigative Journalists who exposed the Panama Papers said, "the biggest consequence of the leak is the massive blow to secrecy [...] authorities try to crack down, they're finding new ways to get around those obstacles or barriers." Until all barriers are removed to move assets, there will be a way for criminals to work around them.”
Árnason also spared no words in describing what the infamous leak revealed:
“I think it has tore open the unhealed wound we got from the Bank crash in 2008. This will send a new wave of demands for change and elimination of corruption. One of the root causes of corruption in our society is the grotesquely deformed monetary system that we have been forced to live with. It’s designed to unevenly spread the wealth of our society and to make us slaves of debt.”
Björnsson concurred that the Panama Papers leak exposed a fatally flawed system:
“In a way I understand the 1% here in Iceland that keep their money in offshore accounts. No one in Iceland wants to keep their money in Iceland and for sure no one wants to keep their money in an Icelandic bank. The reason is a long history of inflation, devaluation of the Icelandic króna and unstable banks. The worst part of this all is that the same politicians that have these offshore accounts tell us, the 99%, that we have to use the Icelandic króna. On top of this they have implemented currency controls so that we really can't exit the Icelandic króna.”
Time for a cryptocurrency-based system?
Finally, Björnsson added that the time may be ripe for cryptocurrency to replace a central banking system.
“Since the collapse of 2008 everyone has been looking for ways to exit the Icelandic króna. Auroracoin came into the picture in 2014 with a fresh idea. Replace the Icelandic króna with a cryptocurrency".