Lessons From the First Digital Gold Boom

In 1996, Douglas Jackson, an oncologist and fan of the gold standard, founded a payments system called e-gold.

The similarities between Jackson's e-gold and Facebook's Libra are remarkable.

An e-gold user could neither deposit gold to the e-gold reserve nor withdraw gold from it.

These wholesalers in turn provided the public with e-gold by offering to buy or sell it at a spread.The same goes for Libra.

Jackson had always assumed that e-gold was neither a bank nor a money services business.

In a blog post, Jackson promised that e-gold would enforce a "One-human being/one e-gold User" rule.

As felons, Jackson and his colleagues were prohibited from applying for a money transmitter license, and so e-gold had to shut itself down.

The actual e-gold model, as set out in Jackson's plea deal, remains intact.

Jackson continues to market the intellectual property for e-gold in the form of Better Money.

The basic e-gold model may be a sound one, but Libra doesn't just want to take up where Jackson left off.