Tips to help a local currency flourish

Is your community having problems with getting your local currency to gain traction, to have a significant amount of usage?

In the USA and many countries in the West, local currencies have had a hard time staying alive. In Brazil on the other hand local currencies are flourishing and make up a significant amount of the total currency flow in that country. Why is that?

Its because in Brazil they create regular exchange fairs in their communities. People bring their used stuff to the fair. They also think of services they can offer, that they might not normally do as a paid job – e.g. dog walking, cooking a meal for someone, babysitting, cleaning someone’s garage. They can be one off services so you don’t have to build a whole business around it.

The problem with many local currencies in the US and the many countries in the West is that people do not engage in creating new services and passing around used goods because of the currency. It is the activation of that new segment of the economy that makes it so powerful. And what makes the Brazilian local currencies work.

Along this line of thinking, a new way to activate new services is to have many Local Currency Circles in your community. In a Local Currency Circle people sit in circle and express their needs or services they have to offer. Others can then help or receive with a local currency exchange. These local currency circles also activate many heretofore unused services.

The Local Currency Circles (LCC) activate more informal business, which are a complement to more established businesses using the local currency.

Usually local currencies take a bit of effort and town wide coordination to startup, but using Local Currency Circles (LCC) one can get one up and running very quickly. Simply create a currency and invite people over for one of these Circles, where people can exchange the currencies in return for helping each other with their needs. Over time the community can help grow the LCC, and then create more LCC’s. Then gradually formal business owners can be invited to these LCC’s, and then the flow of currency can happen outside the LCC’s too, in the business’s around town.




Related Links:

How to start a local currency

Four steps to beginning a local currency

Local currencies in Brazil

Shareable’s article on community currency

The Atlantic’s article on local currency




Social design and the cultural forms we are embedded in

Until we figure out the cultural forms we are embedded in, we will be limited by them. That is the role for the social archaeologist (which exists in all of us), to excavate and bring to light the centuries of structures, processes, systems, memes, etiquettes, and organizational structures that have been unconsciously informing our everyday lives. Brought to light we then find new dimensions of freedom in which to live.

It is into these new dimensions the social architect, the social designer can come in to create new social forms, forms that hold open these new dimensions, so that society will not collapse back into its old state.

Symmetry breaking, timebanks,& capitalism

In a capitalistic system the flow of money can be unsymmetric, with a certain amount of people accruing more and more, at the expense of others. In such a system there has to be growth in the total amount of money  for the economy to survive. In a timebank, the flow of money is symmetric, people oscillate around the zero point of credits, but are never continually increase or decrease.

One can make the argument that a symmetric flow of money in an economic system is usually healthier, that it creates balance. When symmetric breaks a phase transition to a higher level in a social system happens.


Making things affordable, and funding activism through a hybrid currency system

Money is not always what it seems to appear to be. It may not be the problem. In fact, it may contain the solution.

Take going to yoga and cool workshops. It may seem that it is money that makes it not possible for many attend. And it may seem that it the moneyed world we are in that makes it so that yoga studios and workshop organizers need to charge the prices they do, in order that they can pay the rent, and make a living.

Take doing activism or good for the world. It may seem often there is no money to be rewarded for doing what you see can help the world.

However lets step back and look at what money is. Its an agreement to use something as an medium of exchange. While we have been conditioned to believe that only one form of money is available, there are in fact many kinds of money we can create. Different forms of currency can coexist in the same society. We have the option to create different kinds of parameters on how each currency is used and when.

A currency is a system of exchange. If people have things of value to give, and things of value they want, then one can design a currency specifically to enable those things to happen. So lets say you want to take yoga classes and workshops, and you have a service to give, whether it be massage, editing, dog walking, gardening, and that there are also people who want those services, then we can set up a currency system that can enable that exchange to happen more easily.

First we need to do is setup some boundary conditions that makes it more likely that when people perform those services that they will be more likely to use the currency they earn for yoga or other workshops, and not spend it on things that benefit unhealthy multinational corporations and the such.

What we can do is create a complementary currency, lets call it the Yog. And then put on some minifair in say a yoga studio, where people can set up tables to offer their services. Others can come and buy Yogs with mainstream money, with which they then pay people for these services. These Yogs can then be used to pay for yoga classes and workshops, as well as other services at the fair. We can also create an online page where people offer their services which can be paid for, and only paid for in Yogs.

The yoga studios and workshop organizers when they receive these Yogs can then either spend it on services, or they can cash it in.

This system is very similar to most local currencies like Ithaca Hours or the Berkshares, with the key difference being the way the local currency can be converted back into money. By limiting it to one place where they can be converted back, which here would be by the class/workshop organizer, we are creating a flow into these classes/workshops. This kind of limited local currency can be powerful because it is enabling one entity to make money, which means they will focus efforts into organizational and marketing efforts to get this local currency flowing. If they don’t get the local currency going it can adversely affect the attendance in their classes. So they will make efforts like organizing fairs in the yoga studios where people can exchange their services. Which results not only in them having more financial stability, but also enables a local currency flow to happen.

So basically the formula is

Business + limited complementary currency + fair + online platform

And you do this for all sorts of different businesses.

You can also substitute charity or activism work for business in the equation. People can donate the earned complementary currency to the charity or activism work which can then be converted into mainstream cash if needed.

A new, easy to create, type of alternative currency : Multi-coupon currency

Here is an idea for a multi-coupon currency, which is based on the concept that each person can issue coupon for services or goods they offer; coupons that can then be traded for other coupons.

An example of how this alternative currency works. We were at a gathering where 5 of us there formed a smaller group to launch this multi-coupon currency. Each of us in our group made coupons for what we could offer- like language lessons, a video workshop, massages, travel consulting, and intuitive readings. We then traded these coupons with others in our small group. You could trade for a coupon you did not necessarily want, because the idea was that you could keep trading these coupons for others. So lets say you traded your massage service coupon for a video workshop from someone else. You may not want the video workshop but you can go to others to trade this coupon.

We then went back to the larger gathering and started trading the new array of coupons we now had with others. Soon there were a lot of coupons flying around. Like others, I had people coming to me for services that I had not directly traded me. And I had coupons for a variety of services that I could use.

One of the powers of this multi-coupon system, which a normal local currency does not have, is that it is a mutual referral and marketing system – for instance in our case if you work to trade the video workshop coupon you received, you are in fact then marketing that workshop.

Another difference of this system from that of local currencies, is that there is no central group in charge of issuing this currency. Instead there are multiple points of creation and de-circulation of the currency. It empowers the individual to affect the currency in a system, to increase the abundance of the economy, by putting in its services into the mix.

A third difference, is that it can launched easily, as two or three people is enough to get this coupon currency going, and then when they talk to others about their coupons, it can easily entice others to come on aboard and throw their services into the mix. A new person who is approached may be hesistant to accept a local currency if only a couple of other people accept it. With a coupon currency, however, it is different, because they know they are going to be able to get a service with the coupon they accept in the trade.

A fourth difference is that the coupons help spread the word about each persons services, and provides an ongoing narrative of the gifts and interests of the community. And each person, who usually holds a multiplicity of coupons, acts as a co-facilitator of the flow of goods and services in the community.

Coupons already exist in our world, and people trade coupons. People at times also may trade one coupon for another. So the multi-coupon system one could say already exists in our world. The idea here is to focalize what is already happening, and create a higher density of such trades, organize circles and events at gatherings where people actively engage in such coupon generation and trade. Then a multi-coupon flow emerges in a community which becomes a significant economic system that creates new wealth.

This multi-coupon based currency is a system that is between that of one on one bartering and that of a local currency. It’s more formal than bartering and less formal than a local currency. Its more abstract than bartering, and less abstract than a local currency. In the sense that in bartering one is trading object for object. In multi-coupon currency one is trading one type of coupon for another type of coupon, or trading a type of coupon for service. In local currency you are trading a currency where the information about the specific service or good has been erased.

In agriculture it is beginning to be recognized that monocultures are not as healthy as a biodiversity of plants, for the different plants interact in ways to support each other. In city design neighborhoods which are mono-zoned are not as healthy, multipurpose neighborhoods flourish with more life (see Jane Jacobs work on cities). Bernard Lietaer, who has written  a number of books about complementary currencies, as well as help architect the Euro, talks about the danger of having only one type of money, we need a complexity of flows, and hence we need a number of different currencies ( heres a video of him speaking about this). When we have a multiplicity of coupons flowing, we have a healthy biodiversity of currencies.

This multi-coupon currency is useful at gatherings, conferences, schools, and organizations where it can get people quickly trading underutilized services to help unmet needs. One can also setup local fairs where people can trade in this multi-coupon currency and help a local community to increase its wealth by helping it access the richness of services in its community.

Workshop co-ops: Making workshops affordable and profitable.

How do you get people to go to your workshops? And whats a more affordable way to go to all the workshops you want?

The idea: Workshop co-ops. A cooperative owned by participants and workshop facilitators that organizes collective investments of time, space, marketing, money, and education. These co-ops would be self-replicating and mutually supportive.

Say 50 people get together, some of who are workshop facilitators. Everyone puts up a certain amount of money like $10 a month, and agrees to market workshops for x hours a month. People can then go to each workshop for a discounted (or free) price, and can trade marketing, admin, or space setup or workshop help for discounts on workshops. Workshops can have a set price which you can get discounts on ( they could also work if they prefer on gift economy, meaning people give what they would like.)

When there is a base of people to draw from and large marketing outreach from that base, workshops find it much easier to fill up.
As new workshop co-ops form, they can also cross promote for each other, furthering increasing marketing outreach. The workshop co-ops thus forms a larger network where people can also get discounts across the whole network.

The vision is that people can take a lot more workshops, and that workshop facilitators who want to concentrate on doing that more full time, can make a living income from it. Other members may also make money from their help. Surplus money can also be funneled into social movements, and to workshop co-ops that may be servicing the less privileged populations.

This workshop coop model can also have a variation where the workshops, and memberships are done on gift economic, donation based style. In this case a kind of workshop commons is created which is co-governed, creating a people centered business network ecosystem. For the donation style approach to work best, requires also inner transformation, where workshop facilitators are non-attached to outcome, and participants also let go of belief systems and attachments around money, and it requires growing a culture of generosity and mutual help.


Addendum: After writing this article I heard from someone who is starting something that has parts of this model. People contribute membership fees each month (which is up to you how much). Then people submit proposals for workshops, which get selected. Workshop facilitators get paid from membership fees and have a base workshop income per hour. Members can can help get the word out about workshops. The more people contribute in membership fees, and the more the word gets out, then the more workshops they can put on.!connect/c1g0

Nonhierarchical groups and complex systems

Heirarchical systems can to first order approximation be understood by linear thinking and simple cause and effect – the people at the top tell those beneath them what to do.

More nonhierarchical systems require more complex systems thinking to understand what is going, how decisions emerge. There are feedback loops of dialogue from which decisions emerge.

Different facilitation systems lead to different types of feedback loops and attractor states the group can get into.

What decisions get made can be very sensitive to small changes sometimes eg who speaks first, or how where people are seated around the table. At those points of extreme sensitivity one can the system bifurcated. One could argue better facilitation systems display less bifurcation points