Context

A Change of Paradigm : The End of the Industrial Age

“An invasion of armies can be resisted, but not an idea whose time has come.” Victor Hugo

We are witnessing the decline of our industrial age economy, and all of its embedded values and financial systems. “A real change occurs when there is a confluence of both changing values and economic necessity. Not before.” ⁱⁱ The change of values includes, inter alia, taking into account our responsibilities towards climate change, the increasing role of women and feminine values in the society, a more widespread understanding of social constraints and global needs. On the other hand, it is quite easy to see that much of humanity is under-monetized, that the monetary authority is mainly private and opaque and that there is no citizen action on financial mechanisms. Confronted with unprecedented challenges, governments and regulators have admitted their inability to address the issues efficiently.ⁱⁱⁱ A study from Elinor Ostrom, 2009 Nobel Prize in Economic Sciences, shows that communities can sometimes better manage resources than corporate or local authorities.

Smart-Edges Dumb-Centre : A New Collective Intelligence

"Are we condemned to individual intelligence and collective incapability?" Jean-François Noubel

In parallel, we do witness a shift to the Information Society, now that the social media is the standard for interaction : data flows in a non-hierarchical way between millions of nodes. We cannot ignore this structural change, and therefore, we cannot address structural answers in the old fashion ^iv. In order to meet efficiently the forthcoming global challenges, we need new appropriate tools otherwise, with a single hammer in hand, everything takes the shape of nails to hit. Collective intelligence is what shapes social organizations. Individuals, gathering together to share and collaborate, benefit more than when struggling alone. For instance, why has the free software community, without any hierarchy and decisional centre, begun to make products that have higher performance than those of the private industry? 

"We are moving towards a society where the main organizational and technical foundations will be distributed networks. And the key aspect of it is that we now have the technology which enables the global scaling of small group dynamics."  Michel Bauwens

Evolution : A wave of innovations

From a centralized and privately owned system, the media has evolved into being decentralized, free and open to people. Money is about to follow the same path. The currency we use today remains an archaic system inherited from the industrial age and from the pyramidal intelligence era. The media has evolved into being decentralized, free and open to people. Money is about to follow the same path. The future of currency (from the Latin currere, meaning to run) lies in being a digital super fluid no one can grasp in his own hands for his sole profit.

"There is, in other words, a massive inefficiency to be exploited. And so, an army of engineers and entrepreneurs is rushing in, hoping to do to the payment world what has already been done to the music, movie, and publishing businesses — unseat a legacy industry built on access and distribution, drive the costs to zero, undercut the traditional middlemen, and unleash a wave of innovation." Wired Magazine, The future of money, It’s Flexible, Frictionless and (Almost) Free, Daniel Roth, February 22, 2010.

The situation : We Lack a Mean of Exchange

Usually, making a project requires more money than available. Therefore, lots of efforts are made to counterbalance. Sooner or later, too much is asked to capture the rare currency and frustration comes in at the expense of the original idea and belief. This is not the proper way to achieve projects !

We experience scarcity in the material world and abundance in the immaterial one. For instance, the Web is full of content brought freely by individuals for the benefit of all and for a motivation that is not linked to money. People get no money but still produce value. As we speak, for-profit organizations collect this value in exchange of providing free services to their users. Instead, we could give these competences, talents and skills a value and take them into account as a new mean of exchange without facing scarcity.

The Money and Wealth Paradox

The paradox is that, we do actually have much wealth and resources at our disposal in the form of knowledge, experience, skills, time, goods and services. What we miss is a mean of exchange. Money is the typical mean of exchange although it doesn't cover the whole range of wealth and, due to its intrinsic characteristics and regulations, it has escaped from local communities to concentrate relentlessly in wealthier places.

It is widely agreed that the main functions of money are :

• a mean of exchange (so we can buy) VS a store of value (due to the interest)

• a standard of measure (how much it cost) VS a tool for speculative profit (stock exchanges)

However, these functions are contradictory. We want to get rid of the two cancerous ones (interest bearing and speculative tool). Contrary to general belief, money is not a neutral mean of exchange. It has embedded characteristics like being artificially scarce, monopolistic and centralized. Based on scarcity, money catalyses the concentration of powers, induces secrecy, the artificial lack of resources, short-termism going in reverse of the current global issues. Most of all, a forced competition exists between the users of the currency. In recent history, national currency, be it the dollar, the pound, the yen, the yuan or the euro, has been the only real game in town but this is about to change. We are just a few steps away from giving up the rat race which forces us to compete when we just want to cooperate.

Open money, a monetary system suiting our needs

"Alternative (or complementary) currency is a term that refers to any currency used as an alternative to the dominant national or multinational currency systems (usually referred to as national or fiat money). Alternative currencies can be created by an individual, corporation, or organisation, they can be created by national, state, or local governments, or they can arise naturally as people begin to use a certain commodity as a currency." Wikipedia.

In an open money system, we create money at the time of the transaction while we keep tracks of all balances. We then never lack a mean of exchange. Whenever a service is provided, an amount is transferred from an account to another. Members can cancel their negative balance by providing further services to the community.

Online Communities: merging online & physical environments

Major social networks features depend on people profiling: who am I, what are my interests, what do I do, where am I. Apart from legitimate raising concerns - the main one being privacy - these social sites have brought undisputed services and reflect a new form of collaborative intelligence. Nowadays, anyone can freely initiate a gathering of literally hundreds of thousands, simply by posting something of interest on the web. What if these people started to cooperate in real life? We are about to step in the next level.

Notes:

i “The greatest shortcoming of the human race is our inability to understand the exponential function.” Albert Bartlett, physicist.
“Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist.”, Kenneth Boulding, economist.