Venezuela is launching a cryptocurrency backed by oil, gas, gold and diamonds

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How exactly do they expect this will work?  Sure, anyone can just say "this is backed by resource X", or "redeemable for resource X on demand", etc. but that was in the age of paper bills and human systems.  Crypto does not work like that, it's inherently and unavoidable mathematical in nature, and as far as I'm aware there's no way to link the physical world into that process.

[SpaceGhostC2C]

7 minutes ago, Ryan_Vickers said:

How exactly do they expect this will work?  Sure, anyone can just say "this is backed by resource X", or "redeemable for resource X on demand", etc. but that was in the age of paper bills and human systems.  Crypto does not work like that, it's inherently and unavoidable mathematical in nature, and as far as I'm aware there's no way to link the physical world into that process.

Exactly. Basically, "currency is backed by X" just means a particular rule for the creation of said currency, where the quantity of curreny units is linked to the quantity of something else. "Cryptocurrencies" have a particular creation rule as well, where the quantity of the "coin" is linked to the rewards to transaction verification.

You cannot have two independent rules for the same quantity unless you also specify an additional rule linking them. But then they are not independent anymore, and, in fact, one of them would be redundant.

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1 minute ago, SpaceGhostC2C said:

Exactly. Basically, "currency is backed by X" just means a particular rule for the creation of said currency, where the quantity of curreny units is linked to the quantity of something else. "Cryptocurrencies" have a particular creation rule as well, where the quantity of the "coin" is linked to the rewards to transaction verification.

You cannot have two independent rules for the same quantity unless you also specify an additional rule linking them. But then they are not independent anymore, and, in fact, one of them would be redundant.

The closest thing I can think of would be to have a global sensor system in space that can detect what and how much of any given resource exists around the world, and that the outputs of this system were used to sign the crypto function but obviously that is still far from realistic or even sufficient.