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Adventures in mutual credit

The usual mechanism of exchange in daily life and in cryptocurrency markets is using an intermediate commodity called money. If you want to swap the goods and services (G...
The Credit Commons is my design for a financial exchange based on the principles of mutual credit, and autonomous communities voluntarily and trustfully collaborating. As such it differs from the more common exchange architectures in fundamental ways. This post explains how and why there is a difference, and hence why mutual credit exchange is not well suited to current exchange architectures, and hence why the mutual credit exchanges in general, and the credit commons in particular, shouldn't just be grafted onto some existing technology. A normal exchange: assumes that all assets are...
It is easy to do mutual credit or any accounting inside one organisation running one software instance on one server. Accounting between organisations on different software on different servers is much harder though. For a convention payment you have to ensure that one account is incremented AND one account decremented, because if only one of those events happen then 'money' has been created or destroyed. Movement of a virtual commodity from one ledger to another requires only consensus between those two ledgers. Thus all the attempts to join ledgers together, like atomic swaps and...
I've learned in the last decade just how hard it is to work outside the money system. Its like trying to work outside of Facebook - there just isn't anything else equivalent, and all your connections are there. If you drop out of the money system you lose all your trading partners and may struggle to build a new network in a field which is narrower and has less powerful tools. So if we want to make an alternative to bank-debt money, we need to be working at scale. There is almost no point replacing one money for another if every local pound is to be converted back to cash at the end....
table tbody, table td{border:0;} vs Holochain is being talked about in my circles as if it were a magic bullet, and the natural platform for any radical initiative to build on. It is true that Holo represents a radical break with web software, and allows a kind of decentralisation which until now has been very difficult. But I want to compare and contrast it with another approach which I believe is more appropriate in some use-cases, the new web standard, ActivityPub, a protocol for sharing and directing content between social networking hubs. The technologies have important...
Selling tokens is now an accepted way to raise investment capital for IT projects, at least for speculative blockchain ventures. Tokens are not like shares an a company; they do not pay dividends or confer voting rights. Sometimes they can be used to buy the product or service, on the off-chance the company ever gets it to market. But sometimes it is neither of those, and issuers come up with creative ways to assure investors that success of the venture will somehow translate to demand for the tokens. Welcome to tokenomics! AI yellow is a global business directory which has enough eyes on...
Over the years I've come across a few proposals that any person or entity should able to issue their own currency, and I've always struggled about what that would mean and how it would work. This is relevant for recursive currency systems like the Credit Commons in which theoretically any member could create a currency as part of a larger monetary ecosystem. Recently I've been thinking these through and I think the benefits are outweighed by the drawbacks. For many currencies to coexist there needs to be an exchange rate between each currency and each other currency, which means either...
This document outlines a range of technical options and estimated costs of each. Technical projects by nature are notoriously hard to cost because by nature each one is breaking new ground and risks are hard to calculate. For projects to work to a predetermined budget, the technical risk must be priced in from the beginning and this takes the form of high salaries for developers to meet specific technical goals. There are many mIf the goals are softer, if some corners can be cut, if some features are considered optional - i.e. included only if the essential things are completed. The below...
Luisa and I toured Portugal in September 2018 to find out the best places to build a resilient life. Portugal has been hit by recession since the 2008 Great Financial Crisis but not been in the headlines like Greece, Italy and Spain. We say a tourist boom going on in both Lisbon and Porto which is probably assuaging the situation somewhat. We noted that after Holland...
William Stanley Jevons described the four functions of money in 1875: a medium of exchange, a unit of account, a store of value, a standard of deferred payment For some time I marvelled at his clarity, but this week it all unravelled for me. So this post is an attempt at a sanity check. When we say money is a medium of exchange that means that we use money to exchange what we have for what we want. A medium solves the problem of the coincidence of needs and so we can sell what have for money, then buy what we want from someone else for that same money. It is a problem though...

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