The Thalr Solution for Sound Money – ALTCOIN MAGAZINE

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Sponsored article by Thalr on Altcoin Magazine

Many of us living in the western part of the world and are mostly satisfied with the dollar, euro or sterling pound as a currency. We would not question whether it is sound money because they are the default unit of account. If you live in countries like Argentina, Turkey and Venezuela that has high inflation or regular meltdowns of the financial system then you’re painfully aware of unsound money. There are more and more people that are not satisfied with western currencies as a form of sound money and are using cryptocurrencies like Bitcoin as an alternative. Since April 2017, Thalr has been working on developing a new cryptocurrency which can be sounder as money than Bitcoin, gold or any particular fiat currency in existence today.

The original idea of sound money came from Aristotle in the 4th century BC. He defined sound money as:

  1. Durable meaning it should last and not wear out.
  2. Portable so it is practical to carry and use.
  3. Divisible which is where we can make smaller payments and combine those into large payments without losing value.
  4. Intrinsic value is where the money itself has value.

Gold is durable, has intrinsic value but is less divisible and less portable. Gold coins are expensive and are not practical for everyday use. Gold coins could be shaved to make small payments then melted and cast again but this is not easy. Large payments of gold are very heavy, their quality must be tested, must be transported securely, stored securely and therefore not very portable. Every year it is getting more expensive to mine gold as it is harder to extract and so this helps maintain the value. Gold is used in jewelry, electronics and other uses that help maintain is value.

Silver is similar to gold but it has less value per ounce. Silver coins can be used to make smaller payments than gold coins. For hundreds of years the standard size of silver coin was used in Europe and then brought to the USA. The original Thalr silver coins became the Daalder silver coins which were called dollars by English speakers. Then the USA adopted the European silver coin to be the US Dollar. Paper notes started to be printed that was the value of a silver coin and could be redeemed for silver coins. Then the USA switched to the gold standard. In 1971 the gold backing of the dollar was removed and the dollar became a fiat currency, soon after, so did all other central bank issued currencies.

The dollar is durable, portable and divisible but does not have intrinsic value. The dollar notes are backed by the government’s promise to pay “debt” which any holder of the dollar is essentially a limitless creditor, so long as they hold the dollar and thus the dollar is accepted worldwide as payment. The supply of the dollar and every other fiat currency is in control of the governments and the banks so it can be stable in the short term. In the long term, inflation adds up so now the dollar has about 5% of the buying power it had 100 years ago. The value of an asset is affected by its scarcity. While the notion that central banks continue to print billions of dollars every year which contributes to the erosion of its value, we must remember that traditional Banks contribute just as much to this influx of “money printing.” When someone gets a loan or credit card from a bank, the bank is not required to have those same assets on their books as collateral, therefore banking institutions are guiltier of “printing money” than central banks, the central banks just give them the power to do so. The stability in the value makes the dollar practical for payments but is a poor long term store of value because of inflation.

The government and bank actions during the great recession helped to inspire the creation of bitcoin. Bitcoin is durable, portable, and divisible but lacks intrinsic value. We can send millions of dollars’ worth of bitcoin in minutes anywhere in the world for low fees, for the time being, as this will change over time with mining rewards declining and miners’ need to make money, but regardless, bitcoin is very portable, durable and better money than fiat. Since it has no intrinsic value, we can only value it by the market demand and the supply, and even this can be skewed in any which direction at any given time given the lack of transparency from existing exchanges. The amount of bitcoin that can be created is controlled by math and declines over time. This has led to a dramatic increase in the value of Bitcoin over the past 10 years while the short term price remains very volatile. This makes Bitcoin a great store of value but is less practical for everyday payments. Bitcoin is so much faster than doing an international bank wire transfer but transactions do still take 10 to 20 minutes to complete. This makes it less useful for in-person payments. The bitcoin blockchain is extremely secure but it is limited to about 7 transactions per second. This is not enough capacity to handle the volume of transactions necessary for it to be a means of exchange, which was Satoshi’s vision!

There are thousands of “cryptocurrencies” that have been created since Bitcoin. Each of these has a different purpose or strategy for solving a problem with blockchain technology. We decided to create Thalr as an alternative solution to the sound money problem. Thalr is a cryptocurrency so it is durable, portable, and divisible, but the key advantage is that it has intrinsic value by. Thalr is supported by a continuing accumulation of silver bullion reserves. Each Thalr can be redeemed for silver in the same way the original US dollar note was. The fact that silver has long been a precious metal commodity and regardless of time in history, has always had “value” and demand. This gives each Thalr holder the ability to have access to a secure, fast and sound form of money, regardless of where in the world you are.

Thalr has solved the scaling issues of blockchain and in particular cryptocurrencies by having the ability to complete tens of thousands of transactions with finality in under 1 second while also staying truly decentralized, which is the “essence” of cryptocurrencies. The Thalr wallet will allow users to make a payment in a price of local fiat equivalent but the payment will be made in Thalrs, same as existing wallet infrastructures. Thalr will also incorporate itself within the existing wallet and POS (point of sale) systems that will allow for both merchants and consumers to benefit. The combination of sound money (crypto + silver bullion) and scalability makes Thalr practical for in-person purchases, international payments and a store of value.

Yes, Thalr will indeed be available on all the typical platforms that all crypto and fiat have a presence in with regards to wallets, pos systems, and also the ability to load on Visa/Mastercards. All this is great but yet it is not an “innovation” or “evolution” of where money should be going and yet still there is a barrier to entry for a lot of the people in the world that NEED cryptocurrencies to thrive!

While most of the people in developed countries have access to banking and credit cards and don’t need Thalr just to make purchases, they may consider it as a store of value that is easy to spend when they choose because it makes sense to have access to sound money. Thalr can be more attractive to those that are unbanked as in the USA alone, it is estimated there are 10 million unbanked people, which according to many is quite an underestimated number. Many people have no choice but to pay high fees for check cashing and international remittances. They take the risk of holding their assets in cash, which can be deemed worthless at any point (see India). Globally, the numbers are much larger with about 1.7 billion unbanked, but of these 1.7 billion, about 1.1 billion have smartphones. By the year 2025, there are to be an estimated 6 billion + smartphone users globally according to the latest GSMA reports, of which more than 2 billion + smartphone users will be unbanked and underbanked.

In Africa and now Latin America and Asia there are millions of users of mobile money proving the idea works, although in some instances the process of getting these mobile minute credits onto your phone, the fees can be as high as 15–20% depending on where you are, that is not fair nor is it sound money by any means.

Thalr isn’t reinventing the wheel or revolutionizing money, we are simply evolving with technology with the idea that money, as it is, should be in the hands of the people and controlled by the people rather than central bankers or newly formed “governance” structures within the crypto industry by having “validators” when they pay a price to have access to all transactional data. Simply put, Thalr offers the simple solution of sound money, which can be accessed and harvested by anyone, anywhere with any type of computing device, from a low-end smartphone to high-end mining rigs, sticking to Satoshi’s vision of having a truly decentralized peer to peer means of exchange.

The value of a network is dependent on the number of users and more importantly, the future of money is mobile. Thalr has developed a new design of proof of work mining that allows for decentralization where no entity or entities grouped together can ever control the network. The mining model is designed in such a way that mining rewards are distributed to all miners rather than just those with the highest compute power. This structure allows for all devices to receive Thalr block rewards from mining Thalr and this includes smartphones. To ensure that all miners get enough “work”, Thalr will thus validate all on-chain and off-chain transactions. Given the speed in which we are able to validate transactions, this allows for enough work and mining rewards to be available for all miners, regardless of computing power. To be clear, Thalr’s PoW allows for true mobile mining, unlike many that “portray” mobile mining by having AWS based solutions that just “give” credits as a “mining reward”. Thalr’s PoW actually uses the compute power to establish mining nodes. The mining rewards even on a smartphone will depend on many factors but we estimate that when converted to local fiat in some instances can be higher than the average salary for a month in some countries. This can be very attractive to lower income areas that there are unbanked individuals or simply those that want low barrier entry into the cryptocurrency ecosystem.

As the number of users increases over time, Thalr will attract more merchants and partners that see the benefits of sound money that Thalr provides to both the consumer and the merchant. People living in countries with high inflation and untrusted banks will appreciate Thalr as a store of value and for easy payments. The economies in the western world are strong but the national debt is growing to extreme levels that are seen as unsustainable. One day this will put pressure on these economies and their currencies. If this day comes then the western people will also begin to appreciate Thalr as sound money.

Thalr is a fine blend of a cryptocurrency that is censorship proof, incredibly fast, decentralized, accessible and secure with the continued accumulation of silver bullion. We offer it as a practical sound money alternative to fiat currencies as a truly borderless global payment system.

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