The Realm Exchange FAQs

How are Realms issued to Members?

Realms will be issued to members in exchange for £'s and their current value transferred to their Realm Exchange account. Realms may be exchanged with other members digitally within the Realm Exchange.

How can Realms be Earned?

Any member can transfer Realms from their own account to the account of another member. This may be on the basis of an exchange of goods and services or it may be for time spent in employment for that member.

Do 1000 Realms really have the same value as a 1gm bar of Gold?

The Realm Exchange provides facilities to convert Gold into Realms based on the exchange rate of 0.001gm Gold to 1 Realm. We also provide the facility to exchange your Realms into Gold at the same exchange rate, so there is no loss of value within the system and there are no transaction fees.

The Realm stands for REAL MONEY because it is backed by Gold, just like many sustainable money supplies have done for over 2000 years. This means that our community is helping to secure its future against a commodity that has intrinsic value in order to provide long term security and resilience whatever may happen in the global economy with fiat currencies, such as the £ sterling, which do not have this form of secure backing anymore. A fiat currency only retains value when those who use it have faith in the banks that issue it and, since 2008, that faith has been severely eroded.

How does The Realm Exchange cover its costs?

Although free membership is provided to everyone, we encourage upgrades to Prime membership. Prime members must pay a small annual fee in pounds sterling for their level of membership within the Realm Exchange in return for credit balances. This annual fee is used to cover the Realm Exchange costs for each year. 

Free members do not have to pay any charges therefore they are not allowed to have credit limits as Prime members do.  

What guarantee is there for the quality of goods or services offered?

None. you need to assess for yourself and discuss with other members of your community whether a member has the skill level required by the other or what happens if the object passed on fails to fulfil its purpose after the exchange has taken place. There is no ready-made solution, it is only through discussion and trust that resolutions can be found. In case of problems, the rest of the community is there to support the rebuilding of trust.

What about me - I don't have anything to sell!

Individuals can trade in Realms in many ways. They may encourage their employer to pay part of their salary in Realms and accept back Realms into their business to attract new local trade. They may also choose to offer some form of service to their community in their spare time, such as joining a baby-sitting circle or helping to decorate someone's house. Part time earnings in Realms would not be taxable if they are not your main form of earnings. Alternatively you may find that you can have a good clear out and sell some of your unwanted items for Realms. If you do not wish to trade but only wish to support your local business community then consider converting some of your £'s into Realms and encourage local businesses to accept this digital currency. Alternatively you can choose to save your Realms for a future time if you believe that Gold could increase sufficiently to preserve the value of your savings against a declining £ and cash it in later to enable you to keep pace with rising prices in the outside world. We must point out, though, that it is also possible that the value of Realms could decline. We do not have control over the price of Gold in the marketplace. The price is controlled by a representative committee of the major Banks.

How can businesses benefit?

Any locally based independent business can join the Realm Exchange as a Business Member if they can prove that they are located within 25 miles of Lancaster and commit to trade with other businesses for goods and services using the digital currency of the Realm. All Business Members will be encouraged to upgrade their Business Package until they are at Business Prime level so that they can make use of credit for purchases to help their cashflow. This is because it is Business Members who will help to build the local economy and this will benefit all our members. Business Members may start off as Free Business Members but this will not give them any credit limit for Realms.

What about tax?

If you run a business or are self-employed then any goods and services that you offer to others that you would normally pay tax on will still attract tax in any currency. You must declare your turnover through the usual channels. Realms are always valued at the current exchange rate of Gold to Pounds. If you normally charge VAT you must still account for VAT on inputs and outputs. However, if you run a business or are self-employed and you offer goods and services that aren't part of your normal business and the transaction is not carried out in pounds sterling then there is no obligation to declare these for tax purposes. This is our understanding but we suggest you check with your accountant.

What about Organisations other than Businesses?

Any organisation applying to become a member that is not a profit making business will be classified as a Free Business Member. This could be charities or other non-profit enterprises, such as CIC's or volunteer groups. The organisation concerned must be able to show that they are located completely within a 25 mile radius of Lancaster and commit to spending some of their community currency earned within the local community with other members. This could take the form of payments to local businesses for services provided in Realms. Organisations may offer donated goods or provide their own services in exchange for Realms. Organisation Members may upgrade to Business Standard or Business Prime to be allowed credit limits for Realms.

Credit Limits and Realms – how do they work together?

Any Individual Prime, Business Standard or Business Prime member of the Realm Exchange can create Realms by making use of credit up to the limit of their membership. 

In order to purchase goods and services from another member using Realms a member must have a valid credit facility if the transaction takes his account into the negative. Overdraft facilities are provided to members depending on the membership level chosen by that member. For an overdraft of 40,000 Realms an Individual Prime account must have been purchased for £29.95 per year. For 80,000 Realms a Business Standard account must have been purchased for £49.95 per year. For 200,000 Realms a Business Prime account must have been purchased for £99.95 per year. 

In order to sell goods and services to another member using Realms a member does not have to have an overdraft, unless his Realm Balance will be made overdrawn through a transaction. 

Anyone with a negative balance of Realms at the beginning of a month will be charged a small fee of 10 Realms for every 1000 Realms outstanding. This penalty encourages members to clear off their negative balances as soon as possible. 

Effectively Realms are a democratic way of creating liquidity in the community through loans. Rather than using banks to create liquidity who then charge interest for loans, all members of the community can give credit with no interest charged. This allows those with goods and services available to trade them on to those who need them even if the ones who need them do not have sufficient Realms available to purchase them at the moment of purchase.

There is risk associated for both parties involved in a Realm transaction. For the one receiving the Realms there is a risk that should he try to convert the Realms to £'s there may not be sufficient golld held in the Realm Exchange vault to cover it at the time because too many members had borrowed against their credit rather than converting £'s into gold before spending Realms. For the one borrowing the Realms there is a risk that he may end up having to pay back more in goods or services if the value of gold goes up against the £.

If a member leaves the Realm Exchange then he will be liable for full settlement of his outstanding balance immediately.

Is there a time limit on when an overdraft has to be cleared?

We can think of Realms as a mutual credit clearing system in that any member may clear off the outstanding debt of another by paying for a transaction in Realms. Therefore a loan from one member does not imply that the loan needs to be repaid to the same member.

There are no time limits when an overdraft needs to be repaid but a member should be aware of a negative Realms Balance and may choose to repay it as soon as possible so that he does not have to keep paying the overdraft fee at the beginning of every month or run the risk that the value of gold increases against the £ before he/she pays off his/her debt.