Recently, the news has been filled with stories about Bitcoin, a type of open-source digital currency that basically functions like money, but without any of the usual regulatory strings attached to regular currency.

Bitcoin is not managed by any government or central bank, but instead is controlled by all of its users in the marketplace. Much like regular money, the value of Bitcoin depends on a number of factors, including supply and demand, and the security of the currency and of the market.

Digital currency offers a number of important advantages. The primary one is that transactions occur directly between purchasers and sellers without having to go through a third party. As such, digital currency transactions are fast and cost substantially less in terms of processing charges and fees.

Recently, the Oglala Lakota Tribe in the United States became the first aboriginal group in North America to launch its own digital currency, the MazaCoin. Much like Bitcoin and other crypto-currencies, MazaCoins can be owned by anyone and can be used to purchase goods and services from any person or business that is willing to accept MazaCoin as payment.

The main difference is that MazaCoin, unlike Bitcoin, has been adopted as the sovereign national currency of the Lakota Nation in the United States. Because of this fact, the Lakota Nation had to exercise some regulatory control over the currency in two ways.

First, before launching the currency, it pre-mined and minted 25 million MazaCoins to be held by the National MazaCoin Reserve so it could manage unexpected shocks in the marketplace. Second it pre-mined and minted an additional 25 million MazaCoins to be held by the MazaCoin Tribal Trust, which gives out the coins as grants to aboriginals, businesses and non-profits to invest. Once these initial grants enter the marketplace, anyone can use them to purchase goods and services, and the value of the MazaCoins should rise and reach some sort of equilibrium, much like regular currency does when it first emerges.

The implications of this experiment are huge for aboriginal communities.

Most aboriginal communities in Canada have long been interested in furthering two goals. One has been to generate economic development and wealth for their members. Second has been to increase aboriginal sovereignty and reduce the regulatory reach of the Canadian government on aboriginal life.

A pan-aboriginal digital currency in Canada would help many communities achieve both of these goals, as long as a large majority of aboriginal communities adopted and used the currency when transacting with each other and with non-aboriginal businesses and individuals. It would not be hard to imagine visitors to an aboriginal casino, or Canadian energy and mining companies interested in pursuing development on aboriginal lands, readily agreeing to use the new digital currency to do business with aboriginal governments and businesses.

If Canadian aboriginal communities did adopt and demand payment in something akin to the MazaCoin, doing so would dramatically increase the value of the currency, which in turn would immediately generate wealth for aboriginal governments, businesses, and individuals, all of whom would receive the initial batch of coins through an aboriginal trust set up and managed by a consortium of aboriginal entities.

Beyond economics, a new aboriginal digital currency would also be attractive to many communities because it would serve as a powerful symbol of aboriginal sovereignty and autonomy.

Aboriginal communities in Canada have the necessary expertise and wealth to develop a pan-aboriginal digital currency. It's time for them to consider exploring this innovative idea for fostering economic development and expanding aboriginal sovereignty in Canada.