Why Crypto? We have the Euro!

(Nederlandse versie hier)
People naturally tend to leave everything as it is and prefer to continue using things they are already familiar with. Also with something new like Crypto currency. Why should you start using Bitcoins or other crypto currency? We already have the Euro anyway, is the most used phrase if you want to convince people of the usefulness of Crypto currencies.
In this article I want to review the advantages of Crypto currencies compared to the Euro. And I do that using one of the available cryptocurrencies Gulden (NLG) which has a good chance to become a mature alternative of Euro according to my investigation.
Because the writer originally has a Dutch background, the story is written from a Dutch/European perspective, but almost everything that is told is also applicable to other nationalities.

Payments

A big advantage for Crypto currencies like Gulden is that you can send money directly to others, anywhere in the world, just as easily and quickly as an email. Without intervention or dependence on third parties, 24/7 and 100% secure. All you need is a smartphone or a computer with an internet connection.
For these reasons, Gulden as a payment method fits perfectly with the digital age in which we live and offers great advantages over Fiat currencies and payment methods. Because PayPal, credit cards, internet banking, etc. are slow, expensive, inefficient compared to Crypto and you remain dependent on an authority or organisation (which also has a commercial interest).
These kinds of services are also far from being available all over the world. Gulden works worldwide, directly, and independently.

Costs

For example, a payment of a certain amount from the Netherlands to anywhere in the world costs on average less than 0.005 Gulden (= €0.00007, value as of februari 2019) and the transaction is directly available at the time of sending to the receiving party and the transaction can be executed at any time of the day.
Until now it was impossible to execute a bank transfer directly and a transfer took at least a few hours to a day and only on working days. But in 2019 the European banks will finally come up with a new system where this will be faster, but only within the SEPA countries (within Europe).
The transaction also requires that both parties have a bank account for which a contribution must be paid. A standard bank account with a credit card functionality costs about €40.00 per year.

But there are also many hidden cost that normal users do not see but are often passed on in the sales price by shops/webshops.
Here a list of cost for several payment providers in the Netherlands, compare that with the €0.00007 per transition of Gulden.

If you want to make an international payment, it becomes very difficult and expensive. Within Europe it is still possible with a SEPA transfer but to the US or Australia it will be a different story and cost picture.

Micropayments

Because of the low transaction costs of Gulden it is extremely suitable to make so-called micro payments such as a sandwich or a cup of coffee on the corner, a quick shopping on the market, automatic sales, parking fees and so on. Wherever small amounts are involved, from a few cents to a few Euro, and for which we often use cash at the moment. But also the other payments such as purchases from webshops, transferring money to family abroad and just shopping in the supermarket are helped by these low transaction costs.

Energy consumption

A common complaint about crypto is the energy consumption, and the negative impact on the climate change and global warming, to keep the crypto network running. This is then looked at Bitcoin and the energy consumption of this currency. This is necessary to keep the network safe and the transactions handling.
And although Bitcoin consumes a lot, that is true, it is only a little compared to the energy consumption of the banks alone.
But Gulden consumes only 0.007% of Bitcoin’s energy consumption and can handle more transactions with this little bit of energy than Bitcoin and has a safer network. Energy consumption is therefore not an issue for Gulden. And the general introduction of Gulden just would have a positive effect on the achievement of the climate objectives of the Paris Agreement.

Safety

Gulden is, if you take the recommended measures, also safer than the euro, there can not be fraud with the payments and counterfeiting is impossible. You can also backup “Guldens” or save and manage it in several places at the same time. Gulden works entirely digitally and therefore it is also possible to pay with your phone. Your phone is also your wallet. You can also link this wallet to your PC so that you can manage the Gulden on your phone with your PC. If your phone (wallet) is stolen, you can use your PC to send the Gulden in your wallet on the phone directly to a safe address. Besides your mobile wallet, you can also create other accounts in the wallet on your PC. This gives you a freedom of trading that offers much more than the simple current and savings accounts of the banks.

Refund

A transaction with Gulden is immediately irreversible. This means that a seller can be sure of the payment. Compare this with the time it takes before a credit card or bank transaction becomes irreversible. These can be revoked, disputed, distorted or otherwise reversed. With credit card payments, one has up to six months to do so. Payment via Gulden gives a seller immediate security.

Independence

A major and more substantial advantage of Gulden is independence. With Gulden you are in control of your own money and payments: nobody controls you, nobody can block your account or (have) your account seized, etcetera.

Banks and Government

More importantly, Gulden is separate from banks. In the current Euro money system, the banks have an enormous power and we do not even mean the central banks but the ordinary commercial banks, because they have the right to create money and they do so to a large extent. Banks pump money into the economy in the form of debts. If you want to know more about this, just look on the internet for “money creation”.
Because of this self-willed system, it is the banks’ concern to create more and more credits and debts, with the result that we still have the consequences of the banking crisis in 2008 and from which nothing has been learned because the system continues to exist and nothing changes.
Gulden is not managed, spent, or controlled by any bank, company, government, organisation, person, or any other authority. Nor is it tied to any particular country or region, but it is applicable worldwide. It is decentralized and therefore Gulden is actually owned by everyone who uses it.
Gulden can put an end to the monopoly that banks have over our money and payment transactions, and bring this control back to the people themselves, the actual users and owners of the money. And so Gulden can also put an end to the current culture of greed.

This independence of Gulden from the government and banks is not only an advantage in countries with oppressive regimes, but also in our countries the need for this is growing. Think of the new payment directive PSD2: Your bank may share your details with other parties. Soon, the Google and Amazon of this world will also have insight into all your payments. You have to give the bank permission yourself, but even if you don’t give them permission there is a backdoor, they will find out through your connections that have given permission. This leak in PSD2 has still not been closed. And don’t think it won’t go that fast because those companies will give reductions on their products to people who do open up their bank details to the company and then look what happens. Then the relative anonymity with which you can make Gulden payments is a blessing.

Interest

With Gulden it is also possible to get interest on your capital, and a lot more interest than you are used to at savings banks. For Gulden a kind of blockchain deposit functionality has been developed in which you can fix your Gulden for a certain period of time and for which you receive a fee. The function is developed to secure and strengthen the network but has the deposit function as a nice by-product.
The amount of the fee depends on the duration of how long you fix your Gulden and the height of the amount. The annual interest rate is between 1% -10%. It is a process to guarantee and improve the security of the Gulden transactions. You therefore need a 24 hour working computer because your Gulden and digital wallet then join the Gulden Network to check transactions of all users and you will in fact receive the fee for that. The minimum time for securing is 1 month and the maximum time is 3 years. Minimum deposit is 5000 Gulden (about €80 feb. 2019). A maximum deposit does not exist. And remember, once secured you can’t make the Gulden available for the end of the term in any way. The process is irreversible because the regulation is recorded in the block chain.
For people who find it difficult to leave their computer on 24 hours a day, alternatives such as a “Cloud” solution have also been developed. And for the techies among them there is a solution available via a mini-computer, a Raspbery PI.

Value

A much expressed concern is the value of the Gulden. This fluctuates and people wonder if this is not a major disadvantage in free trade. What if a loaf of bread costs G150 today and G155 tomorrow?
This is, of course, based on Euro-thinking. The Euro is the standard in the minds of most people and it will remain so for some time to come.
But ask yourself: is it insurmountable that the price fluctuates? You have been used to certain products varying from day to day for a long time. Take the price of petrol, which changes every day. Do you have trouble with that? All other products in the supermarket can also show a different price per day because of an promotion action or just a price increase / decrease. It is a matter of getting used to.
A too strong value change is of course not nice but not insurmountable and in the future the fluctuations will also decrease is expected.
In principle, the value of Gulden is determined by supply and demand on the Gulden market. Because Gulden is still young and the market is modest in size, this market effect now has a major influence on the current value. But the more Gulden users there are, the higher the value will become but also the fluctuations will be dampened.

Points of attention

Is Gulden then the ideal means of payment? For lots of people it is and for some people it is not. Some people cannot take responsibility for the management of their own money and are very sloppy with wallet security. They don’t realize very well that they are entirely responsible for their own Gulden. You can’t go anywhere if you can’t reach your Gulden anymore due to “your own fault” because there is no central management body.
In addition, there are always points for attention or improvement to be found. Below is a wish list of what the designers of Gulden have in mind to realize in the future.

• Gulden must be accessible and user-friendly for everyone. You should not really need a manual for the Gulden apps.
• The Gulden Apps should work lightly, should not be a heavy burden for your computer or smartphone/tablet and should take up little data space.
• Transactions should be instant, faster than pins (including confirmation).
• Everyone should be able to start using Gulden within minutes (no long synchronization with the network).
• Everyone (in the world) should be able to easily buy and sell Gulden.
• Everyone should be able to trade in an accessible and user-friendly way and therefore understand where the value comes from.
• You should be able to use it to pay anywhere, at least the places where you can now withdraw cash or pay by credit card.
• The network must always be stable and security must be self-evident.
• Everything you can do with your Euros now must also be possible with Gulden.
• The Gulden blockchain must always be and remain decentralized. No masternodes or something like that.
• Your Gulden must be smart and can ‘work’ with companies, e.g. with subscriptions, insurances, mortgages, rent, etc.
• Gulden must be programmable, e.g. Gulden that can only be spent on certain goals or Gulden that are released after a completed task.

Want to know more about Gulden? See the website

Other stories from the writer:
Which crypto becomes the future payment system?
The Good, the Bad and the Ugly, Classifying the crypto-coins.
The white hat ethical investor
The nonsense of…. TPS (transactions per second)