Why we Need a Monetary Ecosystem

Scientific Evidence for Complementary Currencies

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What to answer to
Those who claim that Bitcoin is a potential
problem for banks or the official money
system?

What to answer to
Those who claim that Bitcoin is a potential
problem for banks or the official money
system?

Conventional money provokes various un-

sustainabilities
(2) Conventional money is structurally unstable
(3) Bitcoin as part of a monetary ecosystem is part of
a solution for systemic instability!

A Simple Question

Who creates conventional

money?

A Simple Question

creates conventional
Who

money?

-The Government?
-Central Banks?

A Simple Question

Who creates conventional

money?
The Government?
Central Banks?
Someone else?

All national moneys are created

- out of nothing ( fiat money)

- through bank debt

- with interest!

How many of you have used a

complementary (non-conventional)
currency other than Bitcoin?

Plan
Conventional Money generates un-

sustainabilities
*

Systemic Cause for Monetary Instability

Systemic Solution

Conclusions

Conventional Money System is the

Systemic Cause for 4 Un-sustainabilities
1 !t Amplifies Business Cycles
2) It Makes Economic Growth Compulsory

(3) It Automatically Concentrates Wealth

@ It Programs Short-Termism

1. Money Creation Process amplifies

the business cycle
Economic
Cycle

after money
Creation

Business
(Inventory)
Cycle

2. Compulsory Growth

GRO

When a bank creates money through

a loan, only the principal is being
created, not the interest.
Without new loans (i.e. new growth),
everybody goes bankrupt!

3. Money System Automatically

Concentrates Wealth

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What is the Median wealth

(most frequent amount) of US

households?

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(Federal Reserve Reserve Bank, 2007}

Comparison of Interest Paid & Gained

in ten groups of households of 3 8 million each
reference year 2000
all values in thousands of Euros per household per year

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The Transparency Misconception:

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4. Conventional Money Generates

Short-termism

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Plan
Conventional Money generates

unsustainabities
Systemic Cause for Monetary Instability
Systemic Solution
Conclusions

Money System is itself

structurally unstable

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Between 1970 -2010 IMF identified:

145 banking crashes
204 monetary collapses
76 sovereign debt crises
425 systemic crises = more than 10 countries/year!

My Claim: Our conventional money system is

structurally unstable!

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Sustainability of Complex Networks

Robert Ulanowicz 25 years of ecosystems flow
data. Natural ecosystems have in common to be
sustainable. What else do they have in
common?

Sustainability of Complex Networks

Robert Ulanowicz 25 years of ecosystems flow
data. Natural ecosystems have in common to be
sustainable. What else do they have in
common?
Sustainability of complex network results from
appropriate balance between
and
Resilience, emergent properties from 2
structural variables of complex networks:
diversity and interconnectivity

Balance in Natural Networks

Resilience

Efficiency

(In)Balance in Our Financial Network

"Monoculture = accident waiting to happen"
Efficiency

Resilience

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 Monetary Ecosystem is NOT a

metaphor !!!
Diversity a nd intercormectivity are 2 structural
variables => applies to all complex flow networks
with similar structure, including money system!

Structural variables are independent from what is

being processed in network

biomass in an ecosystem,

electrons in electrical circuit,

information in immune system,

- money in an economy

Key Points

We need monetary diversity, even to stabilize

the conventional money system
(2) Resilience requires sacrificing some efficiency
(3) Digital Age Monetary innovations provide
tools to motivate people at different scales
and issues.

Plan
*

Conventional Money generates

unsustainabities
Systemic Cause for Monetary Instability

Systemic Solution
Conclusions

Sustainability
100%

Optimum

Excess

xcess
Resilience

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Resilience <<fci
{Diversity + Interconnections)

Efficiency (A)
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Sustainability

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Resilience ()
(Diversity + Interconnections)

Efficiency (A)
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S us ta inability
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Susiarn ability
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Resilience (<M
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Sustain ability
100%

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Window of

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Current

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Financial Systerr?
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Resilience (*)
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Efficiency (A)
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Optimum

Sustainability

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Window of "

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Financial System

Resilience (*t)

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Efficiency (A)
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Resilience (<tl
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Efficiency [A)
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Optimum

Sustain ability

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Reestablishment of
Monopoly of Bank -debt Money

Window of

Coilap&e of
Financial System

Resilience {<it
(Diversity + Interconnections)

Efficiency lA)
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Optimum

Sustain ability

100%

Reestablishment of
Monopoly of Bank-debt Money

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Collapse of
Financial System

Resilience (4>l
(Diversity + Interconnections)

Efficiency (A)
(Streamlined)

Plan
Conventional Money generates un

sustainabilities

Systemic Cause for Monetary Instability

Systemic Solution

Towards a Monetary Ecosystem:

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Other Examples
* Big variety of social purpose currencies: elderly
care, ecological, learning, etc.

Terra: A global currency that makes it profitable

for multinationals to think long-term
* Dual Currency Banking reduces poverty (Brazil)
Loyalty Currencies: most common commercial
complementary currencies
Etc. etc. etc.

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Plan
Conventional Money generates several

un-sustainabilities
Systemic Cause for Monetary Instability
Systemic Solution
Conclusions

Our international monetary system is in

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Value Shift
Patriarchal vs, Matrrfocal

Patriarchal Societies

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Matrifocal Societies

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Value Shift
Patriarchal vs. Matrifocal

Patriarchal Societies

Monopoly of centralizing
Currency with interest
=> Great for Industrial Revolution

But Promotes:
- Booms & Bust cycles
- Concentration of wealth
- Destroys community
(incompatible with gift
economy)

-4

Matrifocal Societies

Value Shift
Patriarchal vs. Matrrfocal

Patriarchal Societies

Monopoly of centralizing
Currency with interest
=> Great for Industrial Revolution

But Promotes:

Booms & Bust cycles

Concentration of wealth

Destroys community
(incompatible with gift
economy)

* Matrifocal Societies
Duai Currency Systems
- Partriarchal one for long-distance
- Different type of currency (bottom
up) for local exchanges

Promotes:
-

General well-being for the "little

people
Builds and sustains community

Economic stability for centuries

Value Shift
Patriarchal vs. Matrifocal

Patriarchal Societies

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Conclusions

We need monetary diversity, even to stabilize

the conventional money system

(2) Complementary currencies make it possible

to flexibly adapt to the changes coming in the
21st century

(3) Bitcoin and other crypto-currencies are part

of a systemic solution in an emerging
monetary ecosystem!

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Bernard Lietacr e.i,

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Lictacrh Christian ArmpcrgcT.

Salty Goemcr Stefan Brimnhtiher

Money anu Sustainability

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The Missing Link

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