BarCampBank “near money”

[Dave Birch] James Gardner is absolutely correct that the lack of a set agenda is the power of the BarCamp format. I wasn’t really intending to talk about alternative, complementary or community currencies when I went along last week — I was really thinking more about mobile, to be honest — but when I saw a sticker on the wall, I couldn’t resist and I got to take part in an excellent round (well, oval) table discussion about “near money” (ie, things that aren’t really money but can be used as money). The reason that I’m interested in this is because I’m working on some big picture stuff about the long-term impact of technological change on money, and it seems that one of the key trends that needs to be considered in the analysis is the tendency of the technological change to convert stores of value into means of exchange, thus “monetising” assets. The extent of the shifts are very significant in the history of the financial sector: Consider that before the introduction of the cash management account (CMA), something like two-thirds of Americans’ savings were in demand deposit accounts, whereas afterwards something like two-thirds were not. Following Nick Szabo’s thinking about commodity derivatives, I was musing whether technology push or business pull would dominate an evolutionary period. On the one hand, the technology means that we can trade new instruments, but on the other hand someone needs to invent the new instruments to trade.

But suppose the next evolutionary period is different, in that the technology has decentralised invention to the point where rapid experimentation can take place “at the edge” as the OpenTech crowd would say, not business pull as in the past but business experiment on a large scale. Well, it may be that the next near-money to shift from store of value to medium exchange might already be being traded in some small community somewhere, just waiting for the dynamics of networks to take their course. So what is it? Linden Dollars or Pieces of Telefonica Eight, Microsoft Moolah or Google Groats? To cross the chasm into the mainstream, the near-money would need to be something that it is easy for people to understand and easy for them to visualise holding and using: My candidate is access to telecommunications services (mobile minutes or broadband megabytes or similar). What’s yours?

Here is, in fact, the oval table.

Chris Skinner, sitting to my left in this picture, drew a useful distinction between alternative monies (ie, air miles, mobile phone minutes and various form of The IBM Dollar) and community currencies (eg, the Totnes Pound). This completes the taxonomy of near-money, alongside commodity monies which were not discussed. Anyway, Chris’ point, which I reinforced, was that the adoption of community monies would not be subject to the same drivers or discipline as the adoption of alternative monies, because there is an “emotional” component. I may choose to use the Totnes Pound not because it is the most rational or economically efficient choice, but because I want to express some other aspect of my personality or character through the money I use. It won’t be the brand of card I use that is the battleground of the future, but the brand of the currency I use to transact.

These opinions are my own (I think) and presented solely in my capacity as an interested member of the general public [posted with ecto]