« »

Friday, October 11, 2013

Forget diamonds and gold! 5 "surrogate currencies" that are gaining traction

Bitcoin has gained the status of a legitimate currency
Crypto-currencies are an alternative to conventional money
Faith in governments has fallen. It is still falling. And, there is little telling when and where it will stop. As it does, more and more individuals are looking for other forms of currency – other ways they can store and use their hard earned bucks.

Peer-to-peer exchanges have become widely popular. As have brand-based currencies, also known as private corporation currencies.

Think private business providing their own currency is a new idea? It's not. Prior to the United States Civil War, there were more than 1,600 different corporations issuing their own paper bank notes. The United States, which only issued coins, made up a paltry four percent of the currency nationwide. It wasn't until after the Civil Was that the United States currency was unified.

Paul Kemp-Robertson, Co-founder and Editorial Director of Contagious Communications, asked at a conference in July 2013, "Is there a reason for governments to be in charge of money?"

His question is an important one. It intrinsically implies individuals trust different entities – such as private businesses (aka brands) – more than they trust governments. Additionally, Kemp-Robertson's question begs you to ask another, "What other currencies are really an option for me?"

These are five currencies you might consider using or are already unconsciously using. Depending on your purchasing habits and local, some are better options than others. But, they all have one thing in common – they provide an alternative to the government backed dollar.

 1. Bitcoin

Bitcoin is quickly becoming one of the most powerful currencies worldwide. Unlike most currencies which are owned and operated by a central institution, such as a bank, Bitcoin operates completely over the Internet. It is based on peer-to-peer transactions.

2. BerkShares

Several hyper-local currencies are arising. One of the most successful is located in western Massachusetts where BerkShares have become a regularly accepted currency. More than 400 businesses accept BerkShares and 13 different banks provide exchange stations. In Philadelphia a similar currency is taking root called Equal Dollars and in Ithaca, New York the hyper-local currency is called Ithaca Hours.

3. Star points

Unlike the decentralized Internet based Bitcoin currency or the hyper-local BerkShares, Star Points are a corporate ecosystem. This Starbucks based currency allows users to earn Star Points by using their Starbucks Card of entering Star codes from various grocery store products. These Star Points can then be used to make purchases at Starbucks stores or online. Starbucks reports 30 percent of their transactions are happen through Star Points. Similarly, Amazon established their own rewards currency called Amazon Coins, which are estimated to have sold 1.7 million tablets.

4. Tide

Believe it or not, Tide Detergent is being used as currency. The New York Times Magazine broke the "Suds for Drugs" phenomenon in January 2013. In the article, they explained a recent outbreak of thieves stealing many bottles of Tide from grocery stores. According to the article, while law enforcement was investigating the thefts, they found that "Tide bottles have become ad hoc street currency, with a 150-ounce bottle going for either $5 cash or $10 worth of weed or crack cocaine." Now, you might need to think twice before starting your next load.

5. Sweat

Sweat is a Nike induced currency. Unlike Star Points or Amazon Coins which are earned through purchases, Sweat points are earned through the salty exertion of healthy living. This project, located in Mexico, is considered a "closed environment" because it only includes those who both own and use Nike products.

About the author: Nicole writes about all things to do with the mining industry; from the newest gold mining practices to the best mining pumps on the market.

* Image licenese: Bitcoin, lsokivi, CC BY-SA 3.0