The goal is to provide an educational space for people to understand how virtual currencies work. It's also a place for people to have fun. Among the merchandise you can buy are a variety of digital hats that can be displayed on your account, as well as a special username that shows up in gold to other users.
Ars' senior business editor, Cyrus Farivar, acknowledges that there's no economic benefit to the program — neither users nor the blog will be making any real-world money off the project. It's a closed "ecosystem" that other alternate currencies haven't replicated themselves.
So far, around 900 people have signed up for an Arscoin wallet. But Ars draws as many as 10 million unique readers per month, says Farivar. That means there's a great deal of potential for Arscoin to become a functional economy, particularly as more Arscoins get created.
Anyone can mine Arscoins, just like anyone can mine bitcoins. But unlike Bitcoin, where a winner-take-all system guarantees new coins to the owner of whichever computer can complete a given math problem the fastest, Arscoin encourages collaboration by setting up "pools" where many individuals can combine their computing power. Winnings are divided proportionally, so if your computer contributes to solving a fraction of the puzzle, you win that fraction of the payout.
A working — if "worthless" — economy opens up opportunities to conduct studies on how people behave with their hard-earned digital cash in a controlled environment. Ars is considering adding more hats and other types of items to the Arscoin store in the future, perhaps as a prelude to an economic analysis.
For a detailed explainer on altcoins, check out Timothy Lee's explainer here.