Say what?! Amazon enters digital currency fray!

On heels of the recent Bitcoin discussion, a rather surprising new development to report. Online retailer giant Amazon has jumped into the fray of digital currency, cryptography and semi-bartering.

With Amazon minting currency, Fed at risk

This month, Amazon launched its own coins — a virtual currency that can be used to buy stuff for your Kindle tablet. It is a very tentative move to start with: more like loyalty points on a reward card than actual cash. But every river needs to start with a spring — and with the web’s mightiest retailer behind it the coins could grow into something significant.

Say what again?! Amazon, a giant public corporation is planning to compete with central banking - more specifically Federal Reserve - and their fiat money printing monopoly? Surely, it is not the first time something like this is happening with private sector loyalty money in a Western industrial nation. The most famous and old case is with loyalty money from Canadian Tire Corporation in Canada. Check below for more information.

Canadian Tire Money

But most certainly, Amazon is a lot bigger corporation - a giant - compared to Canadian Tire. Their overall business model also involves commodities/services of lot more diverse nature. On a related note, let us also not for forget all the controversy surrounding dubious sales tax imposition by State of California on Amazon from last year.

Amazon.com and California Sales Tax brouhaha

Getting back to the original topic, issuance of competing currency by a major American corporation opens up a very interesting can of worms. If Amazon now, what's next? eBay/PayPal with their own version of competing currency? Such ideas set the stage for major headaches for central bankers; not to mention various government taxation policies.

A big difference between such corporation competing currencies and Bitcoin however is, Bitcoin follows a completely distributed, un-centralized model. An almost anarchic one, to put it shortly. If central bankers/government bodies feel threatened by competing currencies issued by corporations and wish to kill them with the force of gun, at least they have centralized entities to target. It is a lot harder to do with Bitcoin.

In any event, the fun is just getting started with the Wild Wild West world of competing currencies. Fasten your seat belts if/when getting on the wild ride!