Colored Coins – Digital Dollars For Everyone

I stumbled across a colored coins system offered by Colu the other day. The idea has a lot of merit, especially for implementations outside of currency exchange/investing.

One way that came to mind immediately for me was teaching my daughter about the value of money, without it actually costing me money up front.

I have set up a colored coin for The Geekling, along with a few wallets. There is:

  • A 1-of-3 multisig wallet for her rewards account that The Geekling uses as a spendings account.
  • A 2-of-3 multisig wallet for her savings account, that requires parental authority to make withdrawals.
  • A 1-of-2 multisig wallet for us parentals to store the bulk of the currency for rewards etc in as a bank.

So now, when The Geekling meets the criteria for a reward (in this case finishing all 5 daily chores) she gets a $1 coin transferred to her rewards account. She can either save it, which we will match dollar for dollar,  by transferring it in to her savings account – this account can’t have funds withdrawn until she is 18 – or she can keep it in her spendings account to buy a toy or outfit with whenever we are at the shops, or she can redeem them for extra internet time, or an extra episode of TV or whatever.

All up, it took me about 1 hour to set up, and we have an in-family economy, with rewards for labour, incentives for savings, and best of all, no overheads for running it.

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