The philosopher Jogy Thomas Wolfmeyer has given thought to the monetary system and is attempting to make currencies safer and more stable through the use of AI. Without enabling the feared Big Brother surveillance, all money flows should also remain anonymous, yet the money supply should still become monitorable. This could be achieved through the current authenticity scans of banknotes, which take place separately from the actual payment with the currency, but this time online. For banknotes stored in piggy banks, banks could provide anonymous automatic verification devices so that banknotes can be scanned via the QR code and do not exceed the 10-year period after which they would otherwise lose their value.
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### Introduction to the System ###
The hypothetical digital base currency Globaly Coin (GC).
It serves as a neutral intermediate currency (Reference Unit) that is neither tradable, nor pledgeable, nor economically dependent. Its value is based on a fixed reference index, e.g., a global price index (such as a CPI-like basket of goods and services) at a specified starting point (e.g., January 1, 2030). The GC is purely digitally managed, with physical manifestations in the form of banknotes carrying QR codes to enable integration into existing currency systems. The system is controlled by a central AI that makes autonomous decisions to ensure the stability of other currencies (e.g., EUR, USD) by adjusting the money supply.
The system aims to combat inflation or deflation in target currencies without creating economic dependencies itself. It functions as a „stabilizer“ that protects real purchasing power by dynamically regulating the circulation volume of physical money.
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### Structure of the System ###
1. **Base Value and Definition**:
– The GC value is fixed to a base index \( I_0 \) at time \( t_0 \) (e.g., \( I_0 = 100 \), based on a global basket of goods).
– Each unit of GC corresponds to a constant real purchasing power, independent of market fluctuations.
– No trading: GC cannot be bought, sold, or borrowed. It serves only as a reference for adjustments in other currencies.
2. **Integration with Target Currencies**:
– GC monitors currencies such as EUR or USD. Each target currency has a „permitted circulation volume“ \( M_{\max} \), calculated based on GC.
– Physical banknotes of the target currency are equipped with unique QR codes registered by the AI. Each note has an ID, denomination, and activation status.
– Banks must hold a reserve (e.g., 5–10% of the circulation volume) in the target currency to finance re-printing or destruction. This reserve is „frozen“ and used only for GC orders.
3. **AI Control**:
– A central AI (e.g., based on machine learning and real-time data) analyzes inflation/deflation indicators (e.g., CPI, PPI, money supply M2).
– QR scans: During each transaction (e.g., in stores or banks), the note is scanned and its status updated in a blockchain-like database.
– Deactivation: Notes that are not scanned for 10 years (3650 days) are automatically deactivated. Deactivated notes lose their value and must be destroyed.
4. **Adjustment Mechanisms**:
– **Re-printing**: In case of deflation (prices fall, purchasing power rises), the AI orders re-printing to increase the money supply.
– **Destruction**: In case of inflation (prices rise, purchasing power falls), the AI orders destruction to reduce the money supply.
– The AI selects specific notes via QR code (e.g., older or inactive ones) to minimize disruptions.
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### How the Digital System Works
The system operates in a cyclical process:
1. **Monitoring Phase**:
– Daily/monthly, the AI collects data on inflation/deflation in the target currency.
– Calculation of the current index \( I_t \) compared to \( I_0 \).
2. **Calculation Phase**:
– Determination of the required money supply adjustment.
– Selection of notes for action.
3. **Execution Phase**:
– Orders to banks: Use of the reserve for printing/destruction.
– Database update via QR scans.
4. **Validation Phase**:
– After adjustment: Verification of whether the index has been stabilized.
– Automatic deactivation of inactive notes.
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### Detailed Calculations ###
Here are the mathematical foundations. Assume we have a target currency (e.g., EUR) with current circulation volume \( M_t \) (in units), base index \( I_0 = 100 \), and target stability at \( I_0 \).
1. **Calculate Inflation/Deflation Rate**:
– Inflation rate \( r = \frac{I_t – I_0}{I_0} \).
– Example: If \( I_t = 110 \), then \( r = 0.10 \) (10% inflation).
– If \( I_t = 90 \), then \( r = -0.10 \) (10% deflation).
2. **Required Money Supply Adjustment**:
– The new permitted circulation volume \( M_{\text{target}} = M_t \times (1 – r) \) (reduction for inflation; increase for deflation).
– For inflation (\( r > 0 \)): Reduce volume by \( \Delta M = M_t \times r \) to preserve purchasing power.
– For deflation (\( r < 0 \)): Increase volume by \( \Delta M = M_t \times |r| \).
- Example: \( M_t = 1,000,000 \) EUR notes, \( r = 0.05 \) (5% inflation) → \( \Delta M = 50,000 \) notes to destroy → \( M_{\text{target}} = 950,000 \).
3. **Reserve Requirement for Banks**:
- Reserve \( R = k \times M_t \), where \( k = 0.05 \) (5% reserve ratio).
- Example: At \( M_t = 1,000,000 \), \( R = 50,000 \) units.
- Costs for re-printing/destruction: Assume printing cost per note \( c_d = 0.10 \) EUR, destruction cost \( c_v = 0.05 \) EUR.
- Total adjustment cost: \( C = (\Delta M^+ \times c_d) + (\Delta M^- \times c_v) \), where \( \Delta M^+ \) = notes to print, \( \Delta M^- \) = notes to destroy.
- The reserve must cover \( C \); if exceeded, it is replenished.
4. **Note Selection via AI**:
- Each note has an "activity time" \( t_a \) (days since last scan).
- Deactivation threshold: \( t_a > 3650 \) days → Automatic deactivation.
– Prioritization for destruction: Sort notes by \( t_a \) (oldest first) until \( \Delta M^- \) is reached.
– Example: For \( \Delta M^- = 10,000 \), select the 10,000 notes with the highest \( t_a \).
– For re-printing: New notes with fresh QR codes, distributed proportionally to bank reserves.
5. **System Stability Metric**:
– Variance of the index: \( \sigma_I = \sqrt{\frac{1}{n} \sum (I_i – I_0)^2} \) over n periods.
– Target: \( \sigma_I < \epsilon \) (e.g., 0.01), otherwise scale adjustment factor (e.g., \( \Delta M \times 1.1 \)).
6. **QR-Code Management**:
- Each QR code contains: ID, denomination, hash for authenticity.
- Scan frequency: Expected scans per note per year \( f = 100 \) (estimate).
- Deactivation probability: Based on Poisson distribution, \( P(t_a > 3650) = e^{-\lambda \times 10} \), where \( \lambda = f / 365 \).
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### Possible Challenges and Solutions ###
– **Security**: QR codes with encryption to prevent counterfeiting. AI uses machine learning for fraud detection.
– **Data Protection**: Anonymous scans (no personal data), but tracking of the notes themselves.
– **Scalability**: Blockchain for a decentralized database to handle global transactions.
– **Legal Aspects**: Hypothetical; would require cooperation with central banks.
– **Risks**: If the AI fails, over-adjustments could occur – Solution: Human oversight thresholds.
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### Summary ###
The Globaly Coin system is a digital stabilization network that acts as a fixed reference currency and autonomously adjusts the money supply in target currencies. Through QR codes, AI-controlled orders, and reserves at banks, it ensures stability without trading or dependencies. Calculations focus on inflation adjustments (\( \Delta M = M_t \times r \)), deactivation of inactive notes, and cost management. It reduces economic volatility by dynamically managing physical money and could improve global financial stability in a real implementation, though it carries complexity risks. This is a conceptual model; real implementation would require extensive testing.
### Core Idea ###
Jogy Thomas Wolfmeyer has been dealing with economics and its consequences for currency systems for years, which suffer primarily from speculation-induced instability. To eliminate this factor, a stability currency must also be independent and must not be able to be abused by speculators. There will therefore be no trading in GC, as the currency exists only in digital form and is not an official means of payment.
Cryptocurrencies are also not comparable to this system, precisely for the reason mentioned above. Wolfmeyer’s Globaly Coin is a pure digital tool for monitoring existing currencies and their value in the global market economy.
The implementation of Globaly Coin must not be carried out by existing financial companies, but by international independent bodies whose goal is to regulate the economy without the influence of any lobbyists.
A copyright on the Globaly Coin means that any reports on this coin must refer to the author Jogy Thomas Wolfmeyer as the initiator.