Comments on: On the importance of Convertibility for Mutual Credit currencies

By: Matthew Slater

Matthew Slater — Tue, 15 Oct 2013 14:22:34 +0000

I think ‘convertability’ is not desirable, although informal exchanges with other currencies should not be prevented.
More important is dual payment solutions, where people can pay partly in commercial credit and partly in community credit. Cash makes this very easy, but there are challenges to dual electronic payments involving the banking system.

By: @mikeriddell62

@mikeriddell62 — Tue, 15 Oct 2013 12:49:58 +0000

Mutual credit shouldn’t be self issued as an IOU. It should be self earned as a You Owe Me. Do the work, earn the credit, redeem the credit from someone willing to accept in exchange for something they possess that you want at a price you both agree on (price discovery).

By: Graham Barnes

Graham Barnes — Mon, 14 Oct 2013 14:06:48 +0000

Don’t follow the logic here. Currency is self-issued in a MC system (maybe up to a maximum level specified) as an IOU for future provision of goods or services. If a guaranteed exchange rate is set then there’s nothing to stop joiners from issuing their credit up to the limit and then immediately cashing it in. If exchangability is important (you have outlined the different views about this) it has to be provided via an exchange which essentially matches buyers and sellers and ‘discovers’ the market price.

By: @mikeriddell62

@mikeriddell62 — Sat, 21 Sep 2013 08:38:54 +0000

For me the ‘problem that has haunted’ complementary currencies isn’t convertibility it’s fungibility, sustainability and adoption.
Developing the marketplace so that CC’s can be ‘burned’ is a job in itself. It requires resources to generate sufficient buyers and sellers to populate both sides of the marketplace at once. Funding these resources remains to be the main challenge for CC developers since any platform will need maintaining and developing if it is to continue to grow and add value to people’s lives.
If the CC can begin to function just like money, then it will become an attractive means to produce contribution to communities and or the common good, and will be an ultra-competitive means of turning unused and underused resources into productive use. Over time that currency will grow into an attractive proposition for capital because of its highly productive nature and currency exchanges will emerge to satisfy the need to convert $capital into a community or complementary currency.
Really the problem to solve is the business model – how it sustains itself in the beginning – how it can flourish and blossom in such a way that it doesn’t compromise the values and ethics that are so important to developers of community and complementary currencies.