At midnight this morning in Iceland, digital currency fell from the sky. The developer behind Auroracoin, a digital currency designed exclusively for Iceland, has made $125 million worth of coins redeemable by Iceland's 330,000-or so citizens. That's about 31.8 Auroracoins, or roughly $380 per person, according to the price established by markets for digital currencies before the free distribution (the value has since dropped).
Icelanders can redeem the coins by logging into Facebook through a gateway and providing their Icelandic ID number, or by sending an SMS which can be matched with their national ID. So far more than 1 percent of coins have been claimed, according to the Auroracoin Twitter account, but the site itself is unavailable, perhaps due to high traffic.
"The people of Iceland are being sacrificed at the altar of a flawed financial system."
Auroracoin was launched by a pseudonymous person or persons using the name Baldur Friggjar Óðinsson. The goal is to decentralize power and revive Iceland's local economy, given that the kroner has fallen dramatically in value in recent years. Iceland was hard hit by the 2008 global financial crisis and is still recovering.
"The people of Iceland are being sacrificed at the altar of a flawed financial system, controlled by an elite that made astronomical bets supported by the government on behalf of the people and ultimately at the expense of the people," the Auroracoin manifesto says.
The idea of using digital money to bolster local economies is gaining momentum. Auroracoin is based on Litecoin, a variant of the Bitcoin protocol for a cryptographic currency that can function without a government. Scotland is also offering 1,000 Scotcoins, a digital currency founded by a venture capitalist, to each of its citizens. Greececoin also launched this week. Meanwhile, the American Lakota tribes have made Mazacoin their official digital currency.