Intercoin: The Internet of Local Currencies
A Global Reserve Infrastructure for Communities
Abstract
Intercoin introduces a decentralized monetary infrastructure designed to empower local communities while ensuring global interoperability. Unlike speculative cryptocurrencies, Intercoin’s reserve asset (INTER) is not for individuals or traders. It functions as a transparent, non-speculative settlement layer between communities, enabling them to issue and govern their own currencies, run their own monetary and fiscal policies, and coordinate globally.
By combining local currencies, Pigovian taxes, community-level UBI, and global crowdfunding, Intercoin provides communities with the financial tools to thrive in recessions, strengthen local economies, and deliver aid worldwide. It is, simply, the Internet of Coins.
1. Introduction
The current monetary system centralizes power at the level of national currencies and global financial institutions. While effective for macroeconomics, it often leaves local communities vulnerable during recessions, inflation cycles, and global shocks.
- National currencies are optimized for state-level policy, not local resilience.
- Aid distribution is slow and opaque.
- Cryptocurrencies like Bitcoin have devolved into speculative assets, detached from everyday life.
Intercoin aims to solve these problems by giving each community the sovereignty to manage its own money while connecting globally via a neutral, transparent settlement layer.
2. Architecture of Intercoin
2.1 Local Community Currencies
- Each community issues its own local coin.
- Coins circulate within the community to encourage residents to buy local and businesses to hire local.
- Communities govern monetary issuance, vendor onboarding, and fiscal flows.
2.2 The Reserve Asset (INTER)
- INTER is the neutral, global settlement token — like SDRs for communities.
- Not for retail. Only whitelisted communities may hold INTER, in reserve pools that help local, locally-KYCed vendors cash out.
- Serves as the unit of account for cross-community trade and reserves.
- No speculation: futures, derivatives, and secondary trading are explicitly prevented at the protocol level.
2.3 Bonding Curves and Redemption
- INTER’s redemption price is defined by canonical bonding curves, not speculative exchanges.
- Initial gateway: ITR–USDC curve (via Circle), providing fiat payout rails.
- Future expansions: EURC, USDT, ETH, BNB pools, each bootstrapped above the global price floor.
- Automated arbitrage contracts ensure a single coherent reference price across all pools.
- Over time, liquidity can be phased out, leaving INTER as a pure settlement-only asset.
3. Governance and Compliance
3.1 Self-Regulatory Organizations (SROs)
- Communities are whitelisted by SRO votes.
- SROs enforce governance standards, community legitimacy, and vendor KYC.
- Malicious or captured communities can be expelled via governance.
3.2 Compliance Framework
- SEC/CFTC: no jurisdiction (INTER is not a security or commodity).
- FinCEN/BSA: exempt (INTER is institutional-only; community coins are closed-loop currencies).
- State Regulators: no retail exposure, so no MSB or consumer finance trigger.
- FATF/Travel Rule: satisfied, since counterparties are KYCed communities.
- OFAC: each community enforces its own sanctions obligations; INTER itself remains neutral, like SWIFT or Ethereum.
4. Community Monetary and Fiscal Policy
4.1 Community Sovereignty
- Each community acts as a mini central bank + treasury.
- They set issuance, reserves, and fiscal flows autonomously.
4.2 Pigovian Taxes → UBI
- Communities levy Pigovian taxes on harmful or overused activities (pollution, congestion, waste).
- Taxes are redistributed into a local UBI pool.
- Vendors vote on UBI levels to balance purchasing power with inflation.
4.3 Guarantee of Access
- Members are never blocked from small purchases — ensuring dignity and inclusion.
- Vendors are KYCed only by their community, lowering compliance burdens.
5. Global Solidarity and Aid
5.1 Disaster Relief
- Communities worldwide can crowdfund INTER into disaster relief pools.
- Affected communities convert INTER into local credits for victims.
- Vendors redeem credits transparently, ensuring aid flows directly to the real economy.
5.2 Refugee Support
- Host communities extend UBI to refugees, funded by INTER contributions.
- Refugees receive dignity and autonomy through local spending power.
- Global donors track flows on-chain, ensuring accountability.
5.3 Transparency
- All inter-community flows are visible on-chain, making INTER a better enforcement mechanism than shadow finance.
6. International Reception
- U.S. regulators: satisfied, since INTER avoids securities, commodities, and MSB classification. Only OFAC remains relevant, but INTER helps by making flows transparent.
- China & Russia: unlike Bitcoin or USDC, INTER doesn’t undermine sovereignty — it enhances local resilience.
- Global South: towns and villages can bootstrap local economies without IMF dependency.
- Global Institutions (UN, IMF, World Bank): INTER aligns with SDGs (economic inclusion, reduced inequality, sustainable communities).
7. Long-Term Vision
- INTER evolves into a global settlement layer, like TCP/IP for money.
- Communities govern themselves as mini sovereigns, interconnected through INTER.
- Adoption by thousands of towns makes INTER undeniable, rooted in real-world commerce rather than speculative belief.
- Over time, INTER becomes gold without futures, SDRs without IMF bureaucracy, and Bitcoin without volatility.
8. Intercoin and the Banking System
Intercoin may completely reinvent money.
At the very least, it creates a parallel system alongside banking — one that redistributes wealth and opportunity more fairly. While traditional banks enrich the already wealthy (low-risk loan recipients), Intercoin empowers communities directly.
Through UBI and Pigovian taxes, money flows to where it is most needed: supporting local vendors, stimulating commerce, and helping the poor participate fully in economic life. A community’s KYCed vendors, being the ones who provide goods and services, vote on monetary policy (the level of UBI). Meanwhile, all citizens participate in fiscal policy decisions, such as Pigovian taxes, fees, and tolls.
In this way, Intercoin creates a bottom-up monetary and fiscal system, directly accountable to the people it serves — complementing, and in many ways correcting, the inequities of traditional banking.
9. Conclusion
Intercoin is the Internet of Coins.
It is not for speculators. It is not a casino.
It is a protocol that empowers communities to:
- Issue their own money.
- Run their own fiscal policies.
- Ensure inclusive prosperity.
- And extend solidarity across borders.
Every regulator can be satisfied. Every government can see it as complementary. Every community can thrive. And people everywhere can finally be included in a monetary system by the people, not just for the people!
Win.