In neighbors we trust
Commitment pools can help rebuild monetary systems from the ground up
Imagine a locally bound money system whose trust was rooted in the promises people made with one another. A system powered by a QR code printer, a glorified spreadsheet, and the reputation of those participating. A system where the power of money issuance was held by the users of that money. It would work within nation-state monetary frameworks and refocus some types of economic activity to localized wellbeing rather than growth, extraction, and external accumulation.
When scanning the QR code on a coin, it would take you to an app saying things like:
“The holder of this coin is entitled to 2-3 hours of gardening, carpentry, or household electric consulting & labor from Ron T before Nov 1st. Message on Signal @ront123 to schedule.”
“The holder of this coin is entitled to 1-3 seedlings grown in our basement grow tent. Let us know what you’re looking to grow before Feb 15th. We’ll provide the plants around May 1st. Send a text to 415-555-5678.”
The app/webpage and the underlying data would run on computers in the homes of people participating in the system, not some billionaire owned platform running in a energy guzzling data center. Data would be locked down like Proton mail does things, encrypted at every layer so only the smallest set of users had access to relevant data, and the platform itself cannot. Where possible, servers would run in locations with solar panels or other renewable energy, so even the power used to run the platform was ethically groovy.
Each QR code coin could be thought of as a Resilience Coin, a contract representing specific commitments to people in a given area. Coins could include a zip code that would restrict redemption to those in a given area. Coins could be traded, curated, accumulated with limits, and clear rules of exchange.
Physical coins could be “frozen” into a digital wallet so when scanned would say “This coin is not currently circulating, it is stored in someone’s digital wallet”. Upon redemption, the platform would give the receiver an opportunity to validate the quality of the issuer’s promise. Reputation would accrue to the issuer and then next time they reissued this coin for recirculation, new holders could see the value of the contract in previous redemption by other neighbors, and therefore trust them.
Commitment pools
A system of trust built like this illustrates the concept of a “commitment pool” coupled with some Solarpunk pizazz to spice it up and make it sound fun to build and use. I first heard about commitment pools from Will Ruddick’s incredible book “Grassroots Economics Reflections and Practice”. There he walks through the particulars of how this commitment pool methodology was applied to serve several villages in rural Kenya where cash is scarce but local needs & abilities abound. I left this book starry eyed and inspired, dreaming of what this bottom-up social infrastructure would look like in my neighborhood.
If I tried to build this in my neighborhood, this is what it would look like. If such a thing existed in your neighborhood, would you participate? If not, why? I’m fishing for feedback on whether I should consider building this or if I should join someone else who has already built something similar.
Note that commitment pools can be implemented without tech, so maybe nothing need to be “built” at all—maybe I should just get out there and start talking to my neighbors. The simplest commitment pool can be created with 1) a notebook 2) a community leader willing to maintain an accurate ledger in a transparent way, 3) people that trust this leader. Will’s book had a surprising case study about this no-tech approach; wild that this kind of thing is possible—humans can be so beautiful when organized & incentivized properly.
After you read the book:
…and take some creative time to riff on what those ideas might look like for you, please come on back here and let us know how you’d build a commitment pool in your neighborhood! Or if you already have this going in your life somehow, I hope you’ll share. Happy reading. Happy spring.
Couple of thoughts! First, there have been some local currencies I’m aware of (Sound Hours was functional in my area in the 90s, or one that was issued by a local utility during a storm to mobilize workers, that they could then use against their energy bill), and I think the conditions are really ripe for this idea to take off. Most especially because when we exchange money, we lose value.
for example, I have able to structure several private loans among friends, no banks. The value we held in agreement between us. This flexibility we gave ourselves is proving so valuable: that we are not paying a hefty percentage merely to move money between us, my neighbor gets the interest instead of a giant bank, and it allows our priories and needs to change over time and to use that value in ways that money or debt alone would prevent us from doing.
I also see that we are going to need a different economy built on exchange. Paychecks will not come, consolidation is looming, and vultures hang out at more and more points within our transactions to steal our wealth (Venmo, transfer fees, short-term credit, banking fees). This is untenable, and more people will see value in bypassing that altogether.
I think this could start as small as your block or neighborhood. Proximity increases trust, and a small pilot will help iron out wrinkles. I also think a credit union, public bank, or public utility might develop a program where they accept a certain amount of such currency.
the biggest risk I see is that everyone I am connected to in my local economy is simultaneously being squeezed. Within our networks of mutual support and aid, the buffer we used to have — that some of us would be flush while others are struggling — is no longer there. Everyone is getting hit: with a client who suddenly doesn’t pay for thousands of dollars of labor, with a job loss and a hellish job market, with another year with no cost of living increase, with a job that now pays half of what you charged 5 or 6 years ago, all while energy prices skyrocket and your poorly made appliances fail. There’s a risk that people in this network will not be able to fulfill even small obligations, and no one else will be in a position to bail them out.
but wait there is more... hahaha https://mxtm.substack.com/p/the-autonomous-sovereign-infrastructure?r=ouuxx
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