Generation, Security and Distribution of NationCoins by a Sovereign Authority

Abstract

NationCoins are cryptocurrencies backed by Sovereign Authority (Simply put, they are Government issued Bitcoin-like cryptocurrencies). In this paper, we explain the generation, security and distribution of NationCoins by a Sovereign Authority. We begin by explaining the concept of cryptocurrencies (also referred to as cryptocoins in this paper). We then discuss the concept of Regulated and Sovereign Backed Cryptocurrencies (RSBCs). Then we envision a scenario where cryptocoins are a main medium of exchange in an economy. The generation, security and distribution of NationCoins by a Sovereign Authority are deliberated. Finally, the paper concludes by outlining the functions of the Sovereign Authority vis-a-vis NationCoins.

Keywords: NationCoins, K-Y Protocol, Bitcoin, Cryptocurrencies

JEL Classification: E41, E42, E51, O14, O31, O38