What is a private currency?
Private currency is money issued by a private entity, such as society, rather than a public entity like the government. Like any other currency, the private currency must have any support or has no value. One of the problems with this currency is that other people must be accepted or used only by an issuer. This currency depends on the issuer who may not be forever, so it can switch from use if the issuer is no longer around. Many countries and regions prohibit the creation and use of a private currency, while others have only legal restrictions.
In order to be valuable, the private currency must be supported by the source. Most currencies are supported by precious metals, usually gold, and this is also common between private money. At the same time, the currency can be supported by any source. For example, jewelry, working hours, products, other financial instruments or fair faith in money can support the currency. In this respect, private and public currencies are similar.
unlike a public currency that is immediately accepted by a towerTšina people can be considered difficult by issuers of private currencies. If other people or businesses do not accept this currency system, it will only be used by the issuer. This means that private money is usually used only by a small local group or via the Internet. If this currency reaches a wider audience, it may be difficult for the issuer to have enough resources to support all the money.
Like public currency, private money usually depends on the issuer. If the issuer dies, he pulls out sources that support money or otherwise disappear, the private currency may no longer have any value. At the same time, if the currency is supported by something intangible - such as working hours or faith - and people still use the currency after the issuer is away, it can keep its value.
While there are many private currencyculations, many countries and regions ban or restriction of printing and using this money. It can be out of fear that private moneyThey will be more valuable than public money to undermine the government or that it can facilitate money washing. Before someone decides to create a private currency, they should check any relevant laws to see if it is legally done and whether there are any restrictions.