The future of money, part 5: the single currency or a million different?
We present to your attention the fifth and final part of the cycle Future of Money in the online publication Quartz, in which five experts describe their vision of financial systems. In this article, David birch, an expert on digital financial services and author of the book Before Babylon, the Beyond Bitcoin his arguments in favor of decentralization of the financial system.
The future of money not a single world dollar or in the galactic standard credit. Rather, the future is in millions of currencies.
It may seem crazy because it would be easier if everyone used the same universal yuan. But the money is more than just a medium of exchange in the store. It’s also something that you will want to keep for a long time. And possibly one form of money better suited to pay for coffee at Starbucks, and another for your pension.
We need to prepare ourselves that the world will be hundreds, thousands, or even millions of types of money. Your phone will show you the price of a latte in London Luty, but the translation will be implemented in California the cabbage, apples, Apple parkovochnyh stamps San Francisco. While all this diversification sounds extremely innovative, in fact its roots in the distant past.
Social anthropologist Jack Weatherford a few years ago wrote that “the e-money world is more like the Neolithic world economy before the invention of money than the market, familiar to us the last few hundred years.”
Then money was the memory: I owe you corn, you have the priest, the cow, the priest has wine. The clans claim on assets kept in the collective memory is a constant mental blockchain.
However, it did not scale. The village began to communicate with each other, trade went beyond their limits, the growth of towns and cities no longer allowed to remember who needs what and to whom. What was needed was a mediator.
We took the means of grace (redemption of debts) and turned them into a means of savings that you can sell. They, in turn, became the medium of exchange: the claim has passed from memory, clay tablets in coins.
Today we no longer live in clan villages and urban anonymity the recent past: we are in a global village by Marshall McLuhan, where the digitization of the world allows us to be connected with everyone everywhere and constantly. Instead of memory we have social media, smartphones and the General registers.
We assume that today are money (currency, controlled by Central banks) is the law of nature. But it’s not. This is a special set of anthropogenic transitional institutional arrangements. The former head of the Bank of England, Mervyn king, in his recently published book “the End of alchemy,” writes that “one cannot completely exclude the probability of extinction of Central banks”.
One size does not fit all: just look at the Euro currency, designed to unite the country, which is increasingly causing political differences. Think how hard it is to support the common monetary policy in countries with different economies (that is, to simultaneously develop the economy of Germany to support Greece during the crisis), and then try to imagine a single world currency. The existence of a single monetary policy for Spain and Slovakia is nothing compared to the monetary policies of our planet or all the planets in the alpha Centauri system.
The king and Waterford right: money is the “global village” will not be limited to a few national or supranational Central banks. The blockchain and cryptocurrencies give us the opportunity to literally everyone to create their money, but it will engage more of the community, not the individual. Such currencies will be filled with the values of the group that creates them. I would prefer to defer Islamic e-dinars that are backed by gold, and you can keep your savings in kilowatt— dollars, provided with renewable electricity, but we can do business with each other because our phones have a exchange with artificial intelligence.
I’m not smart enough to predict what will be the money in the future, but I know what they are not: Fiat wrappers on the blockchain, secured debt.
See also: the Future of money, part 1: the co-Founder of the Ethereum debunks mass delusion
The future of money, part 2: Our data is the currency of the future
The future of money, part 3: Cryptocurrency is a new value, not new money
The future of money, part 4: Smart notes will be the cash of the future