Social media posts, claiming the 'Raam convertible bearer bond is the world's most expensive currency are false, as it is a bearer bond issued by United States-based non-profit Global Country Of World Peace as an instrument of global development.
Lawyer Prashant Patel Umrao made claims that the Raam is a "currency" used in the Netherlands (which he refers to Holland) that is the world's strongest and most expensive currency.
Many users of social media too have been these claims.
The bond is being issued in the US and in the Netherlands, and 1 Raam can be exchanged for $10 or €10 in these countries respectively. The claim is being purported on the calculation that since 1 Raam carries the above mentioned denomination and since 1 euro equals around ₹88.79 (Financial Benchmarks Private Limited, August 17, 1:30 PM), the Raam is thus worth ₹888 (10 times the current exchange rate), thus making is more expensive than others.
In reality, while publicly available evidence suggests that the Raam has been used as a medium of exchange within a closed group of stakeholders, it is neither a recognised national currency in any of these countries nor legal tender, but it is in fact a bearer bond. The GCWP calls the 'Raam' initiative as a 'local currency'.
A bearer bond is a promise of value (quite like a currency), and since it does not carry the name of the owner, the bearer of the bond becomes its de facto owner. The bond bears interest (currency does not) and cannot purchase commodities as freely as currency. While currency does not have expiry/maturity date, bonds may carry one, even though the Raam is perpetual (does not mature).
The Raam bears 0.6% simple interest per year, which is another characteristic to show it is a bond, and not a currency.
To differentiate these terms, a currency is a system of money being used in a particular country. A medium of exchange is a mutually acceptable standard for the exchange of goods and services. Legal tender is any acceptable coin or banknote of money (usually the national currency, but there may be more than one) that can be accepted to extinguish financial obligation or debt.
The Raam bonds are visually characterised by their depiction of Lord Ram, the words 'World Peace Nation' and 'Ram Rajya Mudra' in Hindi, along with it visually looking like an actual banknote.They are available in three denominations: 1 Raam, 5 Raams and 10 Raams.
Depictions of the Raam for reference
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The Raam was introduced as a Global Peace Currency in 2001 by the GCWP, specifically Stichting Maharishi Global Financing Research based in Maharishi Vedic City in the US state of Iowa.
Maharishi Vedic City describes project has been described as "the ideal local currency to support economic development in the city and development of local businesses and organizations wishing to accept that currency." The initiative was begun by Maharishi Mahesh Yogi, a spiritual leader, with a known following of six million and whose disciples popularly include the Beatles. His movement is aimed to be cohesive "currency" in a global country of world peace.
Little is known of these bonds today.
But despite the nomenclature stating that it is currency, relevant sources from within the movement, and from government have stated that it is not a national currency intended to complement or supplant national currencies like the US dollar or euro.
1. Comments of the Dutch central bank
A spokesperson for the Dutch Central Bank described the Raam as legal, with 100,000 Raam "notes" issued as of 2003. "The raam can be used as long as the notes are not used as legal tender and it stays within a closed-off circuit of users," he said.
However, back then, the Dutch Central Bank said that they were keeping an eye on the Raam, so that it would not confuse the public. Around 100 Dutch shops and 30 department stores accepted the Raam bond. The Raam bonds could be exchanged for euros at Fortis Bank's branch in the Dutch city of Roermond.
These can be read here.
2. The prospectus of the Raam
The prospectus issued for the Raam in the Netherlands describes the Raam Europe "bearer form". Further, Raam Europe bears interest of 3% every 5 years (0.6% simple interest every year), which is not characteristic of a currency.
The prospectus for 2006 can be found here and 2007 here as with the Dutch Authority of Financial Markets.
3. Parallel use of the US dollar
Raam bonds were accepted in 35 states in US as of 2003.
The "finance minister" of Maharishi Vedic City said the Raam could be used to globally kick start agriculture and eradicate poverty in jurisdictions where the US dollar was hard to obtain. Later, once situations improved, the Raam could be exchanged for other established currencies or be taken out of circulation.
At Maharishi Vedic City, the Raam, along with US dollars and credit cards were accepted, with change of less than one Raam being given in US currency.
This can be read here.