[JumpCrisscross]

> devaluation by whom right

This isn't how currencies lose value in wars. If the amount of money doesn't change, but half the factories are bombed, the output of the remaining factories rises in value relative to that currency. (Ceteris paribus.) The only way around this is to backstop production with unbombed factories. Something a blockchain does jack squat about.

[__MatrixMan__]

Sure, but that's somewhat orthogonal to the matter of how you does your accounting or who issues your tokens. That's just scarcity.

I suppose you could burn tokens when the factories are bombed (or you know, when whatever other resources that back them expire), but that seems like a lot of extra bookkeeping just to keep two numbers equal.

[JumpCrisscross]

> that's somewhat orthogonal to the matter of how you does your accounting or who issues your tokens. That's just scarcity.

It's always scarcity. That's economics. The currency will fundamentally, potentially permanently, devalue in purchasing power in that context without external support.

> you could burn tokens when the factories are bombed

How many tokens do you burn for a textile versus semiconductor factory? Keep in mind, you are in a war zone, which means no guarantee of safe imports or exports. (Also, whose tokens?)

Managing an economy on a war footing is old business. There is nothing Worldcoin does to even remotely approach giving a semblance of an indication that anyone on their team has actually thought about this, like, once.

> that seems like a lot of extra bookkeeping just to keep two numbers equal

This is, in a nutshell, the problem with anything that purports to maintain its value over long durations of time. Value keeping takes work. We can't meaningfully convert ancient currencies to modern ones because it makes no sense to ask how many days' labour a Roman peasant would trade for an iPhone. These problems are fundamental to the notions of value. They don't have a technical solution. Value is inherently, fundamentally, subjective.

[__MatrixMan__]

> The currency will fundamentally, potentially permanently, devalue in purchasing power in that context without external support.

Followed by

> Value is inherently, fundamentally, subjective.

Which is it? Does value exist in real terms or is it made up?

If I'll give you a beer for two of your UBI coins, and you'll give me a pound of barley for one of my UBI coins, then it really doesn't matter that there's a war on somewhere, nor does it matter what the "value" of our coins is in terms of some number, so long as they are issued to each of us at the same rate.

You only have to bother with establishing a correspondence with some allegedly valuable thing in the real world (gold, factories, whatever) if you want a globally consistent notion of value. A notion which, as you've explained, is a fiction, and which I'd argue, is a harmful one.

[JumpCrisscross]

> Which is it? Does value exist in real terms or is it made up?

Yes. (It’s paradoxical because it is, though an unremarkably old paradox at that.)

> If I'll give you a beer for two of your UBI coins, and you'll give me a pound of barley for one of my UBI coins, then it really doesn't matter that there's a war on somewhere

It does if that war just blockaded the barley!

> Better to just value the coins in a nonspecific way

With each area that tends to trade together having a common coin or set of coins for reference purposes, and large interchanges between them?

[__MatrixMan__]

The way I'd do it, each user gets their own type of coin and then they form webs of trust such that tokens flow along paths of transitive trust. In a highly connected part of the web, everybody is treating everybody else's tokens as interchangeable.

Things would differ from traditional currency in cases where users are not well connected. Imagine a newcomer, flush with tokens from a disconnected or distantly connected part of the network. They may not be able to find any locals that will accept their tokens. (This sort of hygiene discourages Sybil accounts and makes difficult the kind of bank-driven shenanigans that were typical of US foreign policy in the 70's). If you want to do remote business you should have to gain the trust of the locals first, and you should have to fear that they'll revoke that trust in response to bad behavior on your part.

The value of a loaf of bread, as expressed in a conventional currency would then be a function of whether the baker had needs that weren't met by the local economy. Communities that are highly dependent on the global economy would have a great need of conventional currency. Self sufficient communities, less so (this is to prevent the formation of the overly complex, and therefore fragile, supply chains that we see today).

So yes, I expect that the structure that you describe would emerge, with densely connected hubs etc. The UBI token would only make sense for use within a hub though. You'd probably use a strictly-scarcity-based currency like USD or whatever for inter-hub commerce.

This is because if the goods are coming or going a great distance then you don't really need all the trust stuff since you're unlikely to be in a position to care about the externalities of their manufacture/use anyway. By contrast, if the goods are coming from your neighbor's back yard then you probably want to be using something besides conventional currency, something that lets you threaten to revoke trust if their operations are poisoning the drinking water or whatever.

Mostly this design is inspired by how CirclesUBI does it, but there's a few tweaks I'd make of I were going to try to build such a thing.

[littlestymaar]

Yes, and not only the factories, but the entierty of the supply chain, combined with war profiteers driving prices artificially even higher.

Contrary to the freshwater meme Inflation is rarely primarily a monetary phenomenon, but it's even less the case during a war.