Such as in France or other countries. What is it, and how does it work?
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As in feudal system? You do realize there is no feudalism in France and hasn’t been for the last 250 years or so? But in general, seigneur, or the feudal lord owned the land (typically given “in fee” by the monarch, or otherwise acquired) and rented land to tenants who worked it, paid their rent in either produce or money; in turn, the feudal lord owned fealty to either their direct senior lord, or the monarch; and had various obligations attached to that – raising, equipping, feeding and paying an army being one of the main ones, being responsible for administration of justice in their feudal territory etc. that being said, there no feudal monarchies anymore, although some absolute monarchies today keep the hierarchy of obligations elements, doling out favors etc.
You know how it probably doesn’t cost $100,000,000 to print a million $100 bills? The difference is called seigniorage: the profit that the mint makes on striking coins and printing bills. It’s pretty much as simple as that.
Seignorage doesn’t actually work, but here’s how it’s proposed to:
Token A is $5
Token B is $5
If the price of token B rises to $5.05, then the protocol mints more of token B, which causes it to be sold down to $5
When over minting causes the price of token B to reach $4.95, then the protocol uses the profits of minting and selling token B to buy and burn it, reducing supply and pushing the price up.
This is an “infinity money loop” used in ponzi crypto schemes.
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