A cryptocurrency market based on the blockchain technology is characterized by the coexistence of a steady-state supply and a volatile e-money’s demand. In this study a cointegration test establishes a long-run relationship between the internal demand of Bitcoins and prices. From this result, we propose to restrain the intrinsic volatility of any cryptocurrency based on the Blockchain technology by introducing a sidechain pegged to the parent chain.
Sidechain, Community currencies, Blockchain, Bitcoin, Demurrage, cryptocurrencies
Lund University, Sten K. Johnson Centre for Entrepreneurship at the Dept. of Business Administration, School of Economics and Management; Sweden; firstname.lastname@example.org
Building on empirical material from 6 months ethnographically inspired fieldwork in Málaga Común, a mutual credit community currency in Southern Spain, the paper uses Ostrom’s (1991) theoretical framework on common-pool resources to look deeper into the provision and appropriation dynamics in the currency scheme. Particular attention is put into the sources of inequality in members’ provision and appropriation capacities. Findings suggest that, embedded as community currencies are in the conventional economy, the sources of inequality from the conventional economy are also brought into the community currency. More particularly, private ownership and specialised complex skills lie behind members’ unequal capacity to earn community currency in relation to their spending needs. The paper ends by outlining some elements that would need attention when designing the governance institutions of community currency schemes that aim to overcome the inequality brought in by these currencies’ embeddedness in the conventional economy.
Mutual credit currency, inequality, Ostrom, resource system vs. flow of resource units; provision/appropriation ratio, common-pool resource.
This is the first issue to be published completely in Spanish and Portuguese (except for the Editorial by guest editor, Filipe Alvez). It collects papers presented at the 4th International Conference on Social and Complementary Currencies “Money, Awareness and Values for Social Change” held between 10th and 14th May 2017. The Conference was organised by Dr. August Corrons at the Universitat Oberta de Catalunya (UOC) in Barcelona, Spain.
We have now published our 2018/2 Issue based on the IVth International Conference on Social and Complementary Currencies organised by the Universitat Oberta de Catalunya in Barcelona in 2017. Filipe Alves is the guest editor of this issue, which you can find here: https://ijccr.net/current-issue/
A second output of that conference will be our next issue 2019/1 and exceptionally it will be published entirely in Spanish.
Enjoy the reading and keep on submitting your research to IJCCR!
Promoting a digital Community Currency (CC) platform can boost local trade for the 700m Africans to be connected by 2020. This figure is based on the GSMA estimated 54% penetration rate of unique internet subscribers combined with Wolfram 1,29 billion population estimation in Africa the same year.
This post demonstrates that CC can improve standards of living through the case of Bengla-Pesa in Kenya, then suggests two ways to adapt CC with the constraints of mobile to scale up. It suggests modernizing front-office by integrating with messaging platforms, then demonstrates how using a Blockchain-based database can enhance back-office security.
Bangla-Pesa is a CC used by 200 small businesses since May 2013 in Mombasa to trade goods and services. Based on a ‘mutual credit’ model similar to the Wir Franc, this system provides local business with a means to exchange their excess capacity. Allotment of vouchers is based on a survey to assess the productive capacity of a participant, backed by four other members in case of default. One week after launching the currency, 83% of respondents reported sales increases with 22% of daily trades done with Bangla-Pesa. For 89% of the network, Bangla-Pesa exchanges did not replace trades in Kenyan shillings but represented separate additional transactions. The presence of Bangla-Pesa in the community may also reduce volatility as people have access to a means of exchange even in times of market instability. Indeed sales can range from 3-15 euros per day! Two more programs have been launched since then in Kenya. Estimates are that each CC increases local trade by USD100,000 each year fueling growth that does not rely on large donors, banks or governments.
There are thousands of CC worldwide, most now use software rather than physical bookkeeping. Free open solutions provided by groups such as Community Forge are aiding their uptake. Yet they are burdened with complex user experience and outdated design. To provide a viable alternative to cash, users need a seamless experience when exchanging CC via mobile. The best interface being no interface, such platforms should almost be invisible. Sending value through a messaging platforms is increasingly popular. In November 2015, WeChat reached 200M users on its payments service, while two weeks ago Facebook Messenger started accepting native payments without sending users to an external website. There is as a result a huge opportunity to plug CC front-end into a conversational BOT to boost user engagement.
According to Richard Logie, 90% of digital CC systems fail to scale due to lack of transparency and governance risk in the process of allocating vouchers. Using Blockain-based solutions would prevent such flaws. Indeed private Blockchains produce a transparent record of account balances that does not rely on a central authority. These programmable trust-less ledgers create an independently verifiable record of user identities and transactions thus solving the accountability issue. Bryan Young designed an innovative CC use case through SlackCoin. Combining Slack messaging platform and Monax open-source Blockchain i.e. eris:db.
Since usage determines the core leverage of today’s economy, developing active digital CC networks is bound to yield great value. Backing up the promises of these disruptive tools Colu raised $9.6m in June 2016 to promote their Blockchain-based solutions for creating local currencies.
The Mutual Credit Currency System, this most radical form of endogenous money, was evaluated and compared with Marx’s Commodity-Money-Commodity requirement. A simple simulation of a small community closed loop economy was used to illustrate the functioning of two types of mutual credit currency systems. The first, dubbed MCSG, behaved according to the specifications and recommendations of the mutual credit currency system’s founding fathers, Riegel and Greco. The second, dubbed the Komoko Monetary System, or abbreviated to KMS, was a sub-type of the mutual credit currency system with some additional restrictions and one additional liberty. The main restriction introduced in the KMS was that it almost exclusively supported the exchange of only newly produced goods and services. The liberty introduced is forecast-based credit allocation. It was shown that the MCSG has an inconsistency that could potentially lead to instability. The restrictions applied within the KMS can provide a remedy for this potential flaw, while at the same time rendering the KMS compliant with Marx’s requirement. The monetary control measures applicable in KMS were discussed, which guarantee robustness and stability and make KMS a true complement to the official fractional reserve banking.
To cite this article: Kavčič, S. (2016) ‘The “commodity – money – commodity” Mutual Credit Complementary Currency System. Marxian money to promote community trade and market economy’ International Journal of Community Currency Research 20 (Summer) 41-53 <www.ijccr.net> ISSN 1325-9547 http://dx.doi.org/10.15133/j.ijccr.2016.003
This paper develops a new classification of non-bank currency systems based on a lexical analysis from French-language web data in order to derive an endogenous typology of monetary projects, based on how these currencies are depicted on the internet. The advantage of this method is that it by-passes problematic issues currently found in the literature to uncover a clear classification of non-bank currency systems from exogenous elements. Our textual corpus consists of 320 web pages, corresponding to 1,210 text pages. We first apply a downward hierarchical clustering method to our data, which enables us to endogenously derive five different classes and make distinctions among non-bank currency system and between these and the standard monetary system. Next, we perform a similarity analysis. Our results show that all non-bank currency systems define themselves in relation to the standard monetary system, with the exception of Local Exchange Trading Systems.
non-bank money, text mining, web data, downward hierarchical clustering, similarity analysis
To cite this article: Tichit, A.; Mathonnat, C.; Landivar, D. (2016) ‘Classifying non-bank currency systems using web data’ International Journal of Community Currency Research 20 (Summer) 24-40 <www.ijccr.net> ISSN 1325-9547 http://dx.doi.org/10.15133/j.ijccr.2016.002
Psychological factors influencing the use and development of Complementary Currencies
Carmen Smith, Alan Lewis
University of Bath, Claverton Down, Bath, BA27AY, United Kingdom, Email: C.J.Smith@bath.ac.uk; A.Lewis@bath.ac.uk
This paper presents a novel socio-psychological analysis of the motivations and experiences of mutual credit members in the United Kingdom and in the United States. Primary data comprised of interviews and participant observation, supplemented with secondary data analysis of organisation documents, and a review of the literature in psychology, sociology and economics. Group members were motivated to secure personal resilience against hardship, and the personal agency that results from this, along with the experiences of community and cultural identity positioning, motivates engagement. Consequently these groups are defined as cultural communities offering personal resilience to members through informal reciprocity. This approach, which prioritises the social aspects of exchange, has implications for the design of complementary currencies, particularly mutual credit initiatives, and demonstrates the value of engaging with the fields of psychology and sociology in developing interdisciplinary understandings of alternative economic practice.
Complementary currency, mutual credit, sustainability, reciprocity, resilience, community
To cite this article: Smith, C; Lewis, A. (2016) ‘Psychological factors influencing the use and development of Complementary Currencies’ International Journal of Community Currency Research 20 (Summer) 2-23 <www.ijccr.net> ISSN 1325-9547 http://dx.doi.org/10.15133/j.ijccr.2016.001
The International Journal of Community Currency Research (www.Ijccr.net) has become the official publication of the newly created Research Association on Monetary Innovation and Complementary and Community Currencies (https://ramics.org/).
Please visit the RAMICS website and join us as member!
This special issue of the International Journal of Community Currency Research (IJCCR) includes 15 papers that their authors presented in their earlier versions at the 2nd International Conference on Complementary and Community Currency Systems, ‘Multiple moneys and development: making payments in diverse economies’. It was held at the International Institute of Social Studies (ISS) of Erasmus University Rotterdam in The Hague between 19th and 23rd June, 2013. It was organised as an event of the Civic Innovation Research Initiative in collaboration with the Qoin Foundation (Amsterdam), the think-tank New Economics Foundation (London), and the Palmas Institute (Brazil and Europe). The event was attended by almost 450 participants from 31 countries, including academics, practitioners, consultants, policy makers and representatives of grassroots organisations. This special issue seeks to reflect that diversity and includes articles on Complementary and Community Currency Systems from most corners of the world. Georgina M. Gómez
To cite this article: Gómez, G. (2015) ‘Introduction: Money and Development’ International Journal of Community Currency Research 19 (Summer) 1-5. <www.ijccr.net> ISSN 1325-9547 http://dx.doi.org/10.15133/j.ijccr.2015.001
This paper investigates the prices set within the Exchange Network of Chania and tries to examine what prices are attributed to which products and services, how those prices are set and what they reveal about the values of the goods offered. Moreover, the further aim of the paper is to explore the implications of those prices concerning the function of the scheme itself, within the context of the local economy of the Chania area. The data have been gathered during regular visits to the open markets of the scheme since January 2012. Therefore, the paper attempts to contribute original research findings concerning prices in parallel currency schemes and study several important issues which arise in multiple currency practice.
To cite this article: Sotiropoulou, I. (2015) ‘Prices in parallel currency: The case of the exchange network of Chania, Crete’ International Journal of Community Currency Research 19 (Summer) 128-136 <www.ijccr.net> ISSN 1325-9547 http://dx.doi.org/10.15133/j.ijccr.2015.013
This paper attempts to explain the success of secondary currencies. Success is defined as the degree to which the initiators of these currencies manage to reach their original goals. In order to do so, we draw on two explanatory factors: the motivation of a currency’s founder and the degree of organization. We employed a combination of qualitative interviews, secondary literature review and standardized questionnaires with seven secondary currency projects in Croatia (CROM), Germany (KannWas, Engelgeld), Greece (Ovolos, TEM) and the United Kingdom (Bristol Pound, Brixton Pound). The main findings are that projects which pursue several different motivations are more successful than those with fewer goals. As for the degree of organization, projects which score high on all dimensions of organization are correlated with higher project success. Building on this we propose a typology of two groups: Type 1 cases have low diversity of motivation and organization (CROM and Engelgeld) and Type 2 cases have high diversity of motivation and organization (Bristol Pound, Brixton Pound, and TEM). The two remaining cases, the Ovolos and the KannWas cannot be clearly assigned to any of the types. The motivation-organization typology can guide future research on the motivation of founding and using secondary currencies.
Lukas Fesenfeld, Jan Stuckatz, Iona Summerson, Thomas Kiesgen, Daniela Ruß, Maja Klimaschewski
To cite this article: Fesenfeld, L., Stuckatz, J., Summerson, I., Kiesgen, T., Ruß, D. and Klimaschewski, M. (2015) ‘It’s the motivation, stupid! The influence of motivation of secondary currency initiators on the currencies’ success’ International Journal of Community Currency Research 19 (Summer) 165-172 <www.ijccr.net> ISSN 1325-9547 http://dx.doi.org/10.15133/j.ijccr.2015.016
Credibility and legitimacy are required to improve the design and implementation of complementary currency systems (CCS) and to engage with public institutions, while depending on sustained support from funders. It is hence necessary to evidence the impact of CCS as effective and efficient tools to reach sustainable development goals. Only around a fourth of the existing studies even touch upon impact evaluation processes. A standardisation of impact evaluation would lead to improve the quantity, quality and comparability of the data collected, as well as to support longitudinal studies and juxtapositions of different types of currencies in their environmental and socio-economic context. After reviewing the literature, this article proposes two complementary approaches to assess the impact of CCS: a prototype of an integral Impact Assessment Matrix based on the goals, objectives and performance indicators, and a tool based on the “Theory of Change” methodology as a common, comprehensive and incremental approach for impact evaluation. Both propositions are currently being applied and further developed by the authors.
To cite this article: Place, C. and Bindewald, L. (2015) ‘Validating and improving the Impact of Complementary Currency Systems through impact assessment frameworks’ International Journal of Community Currency Research 19 (Summer) 152-164 <www.ijccr.net> ISSN 1325-9547 http://dx.doi.org/10.15133/j.ijccr.2015.015
Cooperation, interchange or intertrade of complementary currencies is not yet very common, perhaps of because the funding impulse of most complementary currencies does not cover the question of interchange and cooperation yet, or because theoretical aspects are not often stud- ied. The article describes money or currency as an instrument of cooperation, based on a socio- logical and institutional economics background. It then postulates currency as an operating system and focuses on the technical terms of trade if one would try to establish cooperation between such systems. Basic principles of interchange and intertrade, which are necessary for success, are presented, such as the ideas of trade balance, compensation funds, exchange rates and clearing, set-points and limits, references, anchoring money and tolls and taxes. Further some aspects of governance and negotiation are discussed and a nested framework of rules is adapted to currencies. As an Appendix a case study of the Zurich region is presented where a process of negotiation and building of an interchange network between several CC-groups is on-going.
To cite this article: Martignoni, J., (2015) ‘Cooperation and Intertrade between Community Currencies : From fundamentals to rule-making and clearing systems, including a case study of the Zurich Area, Switzer- land’ International Journal of Community Currency Research 19 (Summer) 137-151 <www.ijccr.net> ISSN 1325-9547 http://dx.doi.org/10.15133/j.ijccr.2015.014
This paper identifies trust as a current crucial challenge for sustainability. Our increased reliance on exchange, specifically where the exchange involves ambivalent trust is a further aspect of this challenge. Ambivalent trust refers here to conflict between our desire to trust others and a reticence to do so, given evidence of opportunism, particularly with regard to strangers. Negotiated exchange is proposed as necessary to account for ambivalent trust. This paper seeks to investigate the potential of addressing ambivalent trust via negotiated exchange using community exchange. Community exchange is a hybrid currency system between monetary exchange and gift exchange. This paper uses the case study of a recently commenced project in North-West Tasmania, Australia, called CENTs – Community Exchange North-West Tasmania, to analyse these dynamics. CENTs aims via a series of stages to build trust and then incorporate the concept of a reputation currency. Although in the early stages of development, to date CENTs is showing potential to build trust via the concept of community exchange, albeit on a necessarily incremental basis.
To cite this article: Krabbe, R. (2015) ‘Building trust: exploring the role of community exchange and reputation’ International Journal of Community Currency Research 19 (Summer) 62-71 <www.ijccr.net> ISSN 1325-9547 http://dx.doi.org/10.15133/j.ijccr.2015.007
Community currency schemes were first introduced in Korea in 1998. Since then, there have been many efforts to use them but no report or academic research on the topic in Korea. Thus, we conducted a field investigation to identify the scope of community currency schemes in Korea and as of 2012 we found 43 groups which use them. The design elements were also investigated but most groups were in an under-developed state, therefore design elements were unidentifiable. Furthermore, we investigate how the community currency coordinators in Korea envision the system using Q-methodology, a method to find the subjective views on the topic. The result shows that the perception on community currency can be divided into four types: ‘Neighborhood as a community’ in which coordinators agree with mainstream economic values and view community currencies as a tool to revitalize the community and to empower local residents; ‘Alternative community’ in which coordinators view currencies as the means to resist the dominant neoliberal ideology; ‘Community through eco-friendly affinity groups’, in which the scheme is a tool to promote an ecologically-friendly lifestyle, and ‘Ecological community’, which represents coordinators who believe that it is an alternative to capitalism and a way to maintain an ecological community.
To cite this article: Kang, J. and Hong, B. (2015) ‘Community Currency in Korea: How do we envision community currency?’ International Journal of Community Currency Research 19 (Summer) 72-80 <www.ijccr.net> ISSN 1325-9547 http://dx.doi.org/10.15133/j.ijccr.2015.008
This paper is a report on the development of a complementary currency system that allows Kenyans in informal settlements to trade goods and services and meet sustainable development objectives. The system in this report, Bangla-Pesa, uses a ‘collaborative credit’ model through a network of local business, whose owners often struggle to meet their basic needs (also known as ‘mutual credit’). The paper documents the reasons for its creation, how it was launched, the immediate positive benefits upon launch, and some of the difficulties faced. Bangla-Pesa is shown to have facilitated, upon its launch, exchanges of roughly 50 Euros in value per day among 109 businesses, which is projected to raise living standards in the community primarily through the utilization of excess business capacity. After only a week of circulation – Bangla-Pesa represented an estimated 22% total trade among community members. This system’s implementation and governance model are detailed with the aim of improving upon and replicating the model for future sustainable development programs.
William O. Ruddick, Morgan A. Richards, and Jem Bendell
To cite this article: Ruddick, W., Richards, M. and Bendell, J. (2015) ‘Complementary Currencies for Sustainable Development in Kenya: The Case of the Bangla-Pesa’ International Journal of Community Currency Research 19 (Summer) 18-30 <www.ijccr.net> ISSN 1325-9547 http://dx.doi.org/10.15133/j.ijccr.2015.003
Local communities in Japan are struggling to increase the number of participants in volunteer activities in order to revitalize local life. To maintain the enthusiasm of active volunteers and entice new volunteers, a new type of reward to increase motivation is needed. Accordingly, community currencies (hereafter, CCs) have been introduced as a reward in an attempt to provide such a source of motivation. In particular, local residents have been expected to participate in volunteer work more frequently in return for receiving CCs; however, there is no evidence yet as to whether CCs arouse their motivation to do volunteer work. In this study, we investigated whether CCs play a role in raising local residents’ motivation to do volunteer work. Our conclusion is that even some people with a no-reward orientation are likely to have their motivation raised by CCs, rather than diminished. This result shows that their perception towards CCs and cash is dramatically different though CCs have the same monetary value as cash.
Ken-ichi Kurita , Masayuki Yoshida and Yoshihisa Miyazaki
To cite this article: Kurita, K., Yoshida, M. and Miyazaki, Y. (2015) ‘What kinds of volunteer become more motivated by community currency? Influence of perceptions of reward on motivation’ International Journal of Community Currency Research 19 (Summer) 53-61 <www.ijccr.net> ISSN 1325-9547 http://dx.doi.org/10.15133/j.ijccr.2015.006