Inventing a Currency Token as a Store of Value

The idea of creating my own store of value came to me when reading this book. Money: The Unauthorized Biography by Felix Martin.

Maybe I could create a token of value to help my kid pay for college. People want to give him money for his college fund and he likes to give them something in return.

I had an idea to base a currency/token on the value of a dozen farm fresh eggs. How bout dat?

The easy part is designing a coin or paper certificate. Making it worth something relies on the trust that it will be worth something tangible when redeemed.

I’ve devised a plan to buy or make a coin.

We produce delicious eggs on birds raise on feed and grasses, fresh food and live home raised mealworms.

I considered buying copper washers and hand engrave it with my farm name- T-90 and a number on them.

The trouble with copper. Anyone can get copper disks. But, not everyone can do my wonky engraving. If I have to shell out the money for 5 dozen copper disks to get them for the lower price I’m paying 73 cents each for them and then I still need to put work into them to make them tokens.

A better idea just came to me. I’m a potter. Clay is cheap. I can even get free clay as our property lies on creek beds and I can dig my own. I can roll out individual clay pieces, stamp them with metal stamps that I already own I can sign them and if need be & I can take them out of circulation with a hammer. A token that can be strung on a necklace is ideal.

The idea is to tie it (financially speaking) to a product with a tangible value. I don’t want to tie it to the USD as that manipulated by the government. A dozen fresh farm eggs is a dozen farm eggs.

The kid has already gained the trust of Brian as, on many occasions the kid has collected eggs for Brian.

Introducing the kid’s college fund token issued by T-90 farm (pronounced T Ninety).

It’s called the DOZ. The DOZ is like a combination of money and a ticket at the bakery or the deli counter.

The DOZ pronounced the same as the word does. What does a DOZ buy you? We’ve forever tied the value of the DOZ to the cost of a dozen fresh farm eggs. A DOZ can currently buy you a pound of fresh tomatoes, a jar of jam or a dozen eggs.

We have a tiny homestead... a teeny tiny homestead. Mammaw would have called it Tee-nine-ee. That’s how we decided on the name for our place. It’s a partially wooded acre with two usually dry creek beds. Local people sell their farm eggs for between 3 and 5 dollars a dozen. That’s how I came up with the value of this token, the DOZ.

The first coins must be distributed so that some people have them. The kid will be giving the first 10 infinitely fascinating 1 DOZ tokens to people that support his college fund. They are wearable art and a store of value. The kid or his agent accepts them in person in exchange for the things on the list. In the future, a jar of our bee farm honey might be 4 DOZ, maybe more.

Current Price List subject to change:

1 Dozen Eggs = 1 DOZ
1 8 oz jar of strawberry jam = 1 DOZ
1 loaf of home baked bread = 1 DOZ
1 large loaf Rosemary Garlic Focaccia Bread = 2 DOZ
8 ounce jar of pickles = TWO for 1 DOZ
1 pound of fresh tomatoes = 1 DOZ
100 Tomato Seeds = 1 DOZ

We don’t have honey bees just yet, but it’s in the works.

It’s like cash in that it doesn’t make fiscal sense to mail around DOZ. The internet has Paypal or Bitcoin for that exact purpose. They give the kid a gift. He gives them a token. They can wear it, sell it, trade it or exchange it, lose it, sleep with it under their pillows or whatever.

If the value eggs goes up or down the 1 DOZ is still worth 1 dozen eggs. The other items for exchange can change in value. A jar of jam might one day not be equal to 1 DOZ. But the 1 DOZ always is worth 1 DOZ eggs.

It’s like a FOREVER stamp issued by the United States Post Office. The forever stamp was created in 2007 as a store or value.(2) Prior to May 2007 a First Class stamp cost 39 cents. The rate changed in May of 2007 to 41 cents. Forever stamps purchased in 2007 are now worth 49 cents.

The forever stamp gains value so long as the cost of postage continues to go up. In April of 2016 the price of a FOREVER stamp went down for the first time in 97 years from 49 cents to 47 cents.(1)(4) It was a good investment for the early adopters but not so much for the people who bought in March of 2016.

Back to Brian. Let’s say Brian gifted the kid $20 in USD & in return the kid gathers fresh farm eggs. Brain is entitled to 5 dozen. Brain already received 1 dozen eggs. We still owe Brian 4 dozen eggs. The kid would like to issue him a transferable record of what is owed to him while he waits for the lazy birds to give him his eggs. Brian gifted first so he wants the next dozens of eggs available guaranteed to him and not one of his other office mates vying to get the limited supply of eggs. I will issue Brian the first DOZ tokens numbers 1-4.

DOZ buyers can “buy” whichever serial number DOZ they want. If they want to collect them for their sheer beauty and uniqueness, they can do that as they will have all different designs and colors. Each unique. Each is also serialized. Marked with my Silversmyth stamp and also with a number 1-10. (So far that’s how many are in the works.)

Just a moment. I need to yell at the lazy chickens to get to work. Brian wants some eggs!

There is no fixed number of coins as there is no fixed number of eggs. Should too many DOZ be issued then trust in the kid’s ability to supply the value would be eroded. The supply of DOZ should be limited. Further research in this area is needed.

The lower number the token produced, the more valuable it is. Here’s why:

For example:
The kid arrives on the scene with two jars of jam, one of each blueberry and strawberry. Current price of 8oz of jam = 1 DOZ.

Two “customers” appear with DOZ. Brian has tokens 1,2,3 & 4 and wants to purchase the only jar of strawberry jam. Frank has tokens number 5 and 9.

The customer with the lowest number on any of his DOZ is entitled to his pick of the jam. Brian will turn in a number lower than Frank’s so he has dibs on the jam but doesn’t lose his status as having first pick next time around. The transaction is complete.

Brian didn’t fall off the turnip truck yesterday. Brian paid with DOZ #4. Frank buys the blueberry jam with DOZ #9. And then swaps his #5 Token for the #4 token. Now he’s gaining dib power.

Brian comes back the next day with $4 he wants to buy another token. The kid only has token#5 & #9 in his pocket. Brian offers Frank $5 USD for his #4 token. Frank accepts as he has just made 25% ($1) profit on his trade but lost some dib power. Oh no, Brian has just driven up the cost of a dozen eggs! Or has he? Not for Frank or Brian. A trend of people exchanging money for better dibs starts a new economic system.

All gifts are dropped into the kid’s college fund. The “customers” know they are giving a gift that will help the kid in the future. The parents supplied the feed and the coop so the kid has no overhead costs. The tokens are supplied to the kid at no cost to him.

The next guy sees that the kid now has a low number token. It’s all the same to the kid he can trade for that lower number token and then pay with his higher number token for the less desirable blueberry jam or hold his lower number token until there is something he wants first dibs on. It’s in the customer’s best interest to hoard the tokens with the lowest numbers to ensure that they have the best odds at getting the item they want dibs on.

Ashley picked up lunch for Frank. Frank is out of money. Frank gives Ashley his highest number token to pay her back. Ashley accepts and wants the kid to bake her some homemade bread.

The kid supplies the bread and takes back Ashley’s token. Which token number did Ashley get? Were you paying attention?

I had the idea that I should issue tokens to the neighbors maybe as a gift or as payment for a favor given. Maybe the pick up my mail token could be invented?

So we’ve combined the ideas of a ticket at the deli, a coin, a wearable, a thing of beauty and fun. I’m going to paint these in all different colors. Each unique.

Are postage stamps currency?
Stamps are cheaply printed and are a one use item that is cancelled after the package or letter is moved. Do you know you can buy a forever stamp now and then resell them for a greater value later? Not illegal. It’s even legal to sell stamps for more than their face value right now.(3)

Sources:
(http://money.cnn.com/2016/04/08/news/companies/stamp-price-decrease/index.html)
https://en.wikipedia.org/wiki/Non-denominated_postage
http://www.snopes.com/legal/postal/resellstamps.asp
http://time.com/4285938/postal-service-drops-stamp-prices/