I dream of building a Bitcoin-powered USD ecash system that doesn't rely on third parties to custody the mint's fiat balance but instead uses Lightning DLCs to stabilize the mint's reserves.
Discussion
The only acceptable cbdc
Yep. It could be any local unit of account, actually.
Can you please elaborate? Excuse my ignorance but how do DLCs fit in here? A Chaumian mint is fundamentally custodial and while it can provide all the transparency in the world, it can close shop at any time, right? A DLC contract could force hands between mint operators but not between token holders and the mint, right?
The mint uses DLCs instead of an exchange to stabilize its balance. That way you open the door to offer this service by anyone who can participate in Bitcoin (everyone!).
One thing I've thought about a fair bit (in the shower) is the need for oracles. As more "trading" volume moved off of exchanges, price oracles based on them become less and less accurate. Non-exchange oracles seem far too gameable with wash trading, although that obviously exists today anyway.
This becomes doubly hard with off chain DLC trades since you can't really prove they happened, and even if you could, you can't prove the parties didn't immediately reverse the trade and suppress the proof of that reversal trade.
On the other hand, I suppose all of this would be "nice problems to have". If we get to such a world, we've already halfway won.