Friday, February 24, 2017

The craigslist coin, part 2

In a previous post I discussed the craglist coin as a sandbox use case. It solved a problem.

If you need a household appliance that weights more than 25 pounds, the local inventories are sparse because no one wants to pay shipping costs up front. If you buy, say a wall oven, the ting can  have $150 in shipping expenses.  That is the wedge that craigslist lives on.

So, if I am looking to find a wall oven, in the near future, then it behooves me to by $20 of local craigslist coin, and put them on deposit. In the sandbox, that does two things, it signals others who might be remodeling to go ahead and order the new stuff, they got buyers for the old.  Local transportation costs drop to $`10. Then on price, the cragslist S&L offers loans against deposits allowing transaction to have flexible, compressible pricing; the deals can more efficiently take advantage of reduced transportation costs.

The gain is local, the S&L members and coins have to designed local.  Local appliance coins across the country will be coherent because the trip across town in a pick up is the same.  But, the S&Ls have to be local,   There  will be no arbitrage moment across regional craigslist, by design.  Each craiglist can peg the cin by selling access to the S&L distributions, or selling craigslist ads even.  These balancers work in a transaction cost = zero environment.

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