On a related note, has anyone else in the Less Wrong community looked into RipplePay? It's a system that, instead of being based on a finite currency, is based on distributed transferable IOUs.
Paper fiat money can be interpreted as an IOU from the government, transferable, and valid for use on your taxes. Ripple payments are private IOUs, valid for canceling debts with the issuer. To make a ripple payment to someone who trusts you, you simply issue them an IOU (assuming you haven't maxed out your credit with them...). To make a ripple payment to someone who doesn't trust you, the system finds a route along which IOUs can be exchanged (eg Alice gives one of her IOUs to Bob, who gives one of his to Carol, and then Carol gives whatever it was that Alice bought to Alice).
My biggest critique is that there isn't a distributed protocol, and the only implementation currently relies on a single central server. That, combined with the bootstrap problem, makes it unusable in practice. (BitCoin has a similar bootstrap problem, but less of a critical mass problem, since you don't have to find a route among people who both trust each other and use BitCoin.)
Comments or critiques, on either the theory or practicality?
The concept of RipplePay seems to require people accepting significant default risk from many people, for no compensation. The size of the risk accepted and the carrying capacity of the network are proportional, such that making it useful requires making the default risks large. The proponents suggest setting up lines of credit with your friends, but this seems like courting disaster; not only would I be risking both money and friendships, I'd have to pay for expensive due diligence, I'd have to occasionally offend people by signaling mistrust, and I'd be ...
Less Wrong used to like Bitcoin before it was cool. Monthly threads popped up around the same time a pricing bubble brought mainstream attention last year. When the bubble popped, and price continued to deflate, discussion on this site stopped entirely. Was there a change of sign in the social status of the topic, is the topic fully explored, or has there simply happened nothing of interest over the last year?
If you are not familiar with Bitcoin, here is one intro I happen to like.
Kaj Sotala lists a number of previous threads on the topic:
Less Wrong seems like a good place to discuss recent developments, if one does not want to suffer the inanity of the officially unofficial forum. If you are not longer interested in Bitcoin, perhaps send your remaining balance to the Singularity Institute?