A Universal Basic Income in Cryptocurrencies – A Strange Utopia Taking Shape on Ethereum

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The debates concerning the creation of a universal income are increasing. Tired of waiting for a state decision, the creator of Gnosis has created a universal income on Ethereum: the Circles UBI experiment.

The history of Circles UBI

On October 16, the Circles UBI (Universal Basic Income) project announced its launch on the Ethereum mainnet.

As the name suggests, Circles UBI is a universal income project on the blockchain. Thus, when a user registers, a unique cryptocurrency is created for him and distributed daily on his wallet.

“When new users join Circles, a new personal cryptocurrency is created for them on a smart contract. This currency is then regularly issued and added to their account, thus forming the basis of the universal income program. »- Documentation on the Circles UBI project

The system then relies on trust to place a value on the tokens. Because of this, users have the ability to trust the personal currencies of other users, treating it the same as the currency they hold.

“People who know each other can agree to set a fixed exchange rate between their currencies at 1: 1. They would mutually accept the existence of the other. They would form a ‘circle’ of 2 people and, within this ‘circle’, the 2 currencies could be considered equal. » – Publication of Consensys on the project

Ultimately, the project hopes to convince more broadly by involving businesses, cooperatives, local governments, etc.

A life-size test

For now, the project looks more like a full-scale test. Indeed, several important features, such as token transfers, are not active at the moment.

We can imagine that the first will is to bring together a maximum of members before opening transfers between them.

If you want to test it for yourself, you will need to register on the website of Circles UBI. Once registered, your account must be validated and, for this, 2 methods are available to you.

You can first get validation, a kind of sponsorship, from 3 other already validated members. This “social” validation ensures the confidence of the various actors among themselves.

Or, it is possible to override this social validation by sending xDAIs to the Circles wallet address. To do this, we recommend that you get a few xDAIs via a faucet, then send a minimum of 0.01 xDAI to be validated.

Despite everything, this project presents some gray points. Indeed, since transfers are disabled, it is impossible to recover these xDAIs. In addition, the sponsorship system can lead to certain abuses, where Internet users would charge others to obtain their validation. In the meantime, it will be a question of following the evolution of the project with a close eye, as it can recall the reflections carried out by some concerning the possible links between cryptocurrencies and local currencies.

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Ethan Hunt

Bitcoin Maximalist and Toxic to our banking and monetary system. Separation of money and state is necessary just like the separation of religion and state in the past.

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