The New Orleans Bitcoin Exchange LLC was incorporated in 2011 by founder Arash Dini,
who is an orthopedic surgeon. Though Mr. Dini lived in Florida at the time, his company
was incorporated in Louisiana due to the regulatory laws regarding ‘investment banking’
being more permissive. One might wonder what physical Bitcoins might have to do with
investment banking (especially since it was 2011, when the very first physical Bitcoins were
being created), but it must be understood that the company’s business plans were much more
complex than the minting of rounds or loading crypto-currency into coins.
The idea was to create what is essentially a Bitcoin bank, issuing physical coins that are
guaranteed to be redeemable for the face-value of BTC. This would have meant that those
using the exchange would not be holding any ‘real’ BTC, but instead an ‘I Owe You’ from the
company in much the similar way as US currency was representative and redeemable for gold
bullion during the time of the Gold Standard in the USA. The idea was to allow anyone to own
bitcoin in a material way that they could understand. This business never materialized due to
the amount of regulation and other complications that such a venture would encounter, not
least of which was the fact that credit card companies refused to allow their cards to be used
for New Orleans Bitcoin Exchange purchases. Despite the initial failure, it should be noted
that Arash Dini was one of the first individuals (along with Casascius’ Mike Caldwell) to give
Bitcoin a physical form that could be transferable between individuals in a physical manner.
Though it is true that the framework would have required complete trust in the New
Orleans Bitcoin Exchange’s ability and willingness to secure its stored BTC and allow it to be
redeemed for coins, it should not be forgotten that essentially all physical crypto-currency
manufacturers demand a similar level of confidence because there is theoretically little to
stop them from secretly recording all private keys and emptying ‘secure’ coins at will. When
considering this overall plan, it is clear that it went against the ‘spirit of Bitcoin’, which is
meant to be a trust-less currency which is directly held by the owner instead of by a bank or
other third party; a fact Mr. Dini himself has admitted. The first series of ‘NOLACOIN’ coins
were originally created for this venture, and though they were intended to be ‘coins’, they
were eventually sold as ‘rounds’ alongside the newer NOLACOIN coins.

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