Aaron Fernando: It is common to see questionable policies enacted by state and local governments under the guise of economic development — policies which appear to serve the interests of private entities rather than the interests of society at large. Yet at the other end of the spectrum, real and sustainable sources of wealth, along with the many non-financial elements crucial to the health of societies, continue to be generated by individuals and small-scale producers, largely without much assistance from local governments.

Recently, the U.K.-based foundation Nesta released an interactive visualization called ShareTown, intended to help people think about what it might look like if local governments used technology and focused on both small-scale local organizations and individuals in creating positive social outcomes within a locality. Described as “an unashamedly positive vision of a preferred future in which interactions between citizens and local government are balanced and collaborative, and data and digital platforms are deployed for public benefit rather than private gain” ShareTown allows visitors to click around and explore an interrelated set of organizations, institutions, and individuals in one vision of a prosperous local economy of the future. These organizations include a makerspace, a community waste and re-use center, a childcare cooperative, a mobile library and resource center, and many others — all in some way utilizing technology and supported (financially or otherwise) by local government.

The ideas in ShareTown were derived from a workshop in May 2018 with leaders from local governments and members of the public, and discussed in light of drastic budget cuts faced by local governments around the U.K. Although ShareTown is U.K.-specific and offers links to “Reference Points,” which are existing projects, similar projects have already been sprouting up around the world. For instance, ShareTown contains a platform co-op which links freelancers with resources and protections against certain types of risks. The cooperative SMart is mentioned ShareTown, but others around the world like the Freelancer’s Union in New York City, New York, operate similarly.

However it is noted that “ShareTown is not intended as a prediction, but a source of inspiration — and provocation.” ShareTown was created by Nesta’s ShareLab, which has “a mission to grow evidence and understanding of how collaborative digital platforms can deliver social impact.” Thus, explicit in this approach is the belief that data collection and specific technological tracking and monitoring solutions will lead to positive social outcomes. This includes certain initiatives with potentially uncomfortable data-gathering, such as a mobile library operated with a mix of public and private funding which also tracks user outcomes.

In light of recent, serious data breaches like those of Marriott and Equifax, along with the reality that digital platforms and big data have been utilized by the few to manipulate the many, this technological optimism is indeed a provocation and something to be discussed. ShareTown provides a thought-provoking angle with which to think about the role of government and technology in maintaining a healthy local economy, and can be thought of in tandem with frameworks such as the Cleveland Model and the Preston Model. These two models in particular illustrate flows of money, time, and other resources between institutions and organizations without focusing on the usage of technology. Taken together, these frameworks can help both local residents and public officials think about and reframe how a locality achieves economic resilience even with limited resources.

Header image is a screenshot of Nesta’s ShareTown interactive

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Aaron Fernando: We recently explored how blockchain is being used as a force for good and conducted a handful of interviews with practitioners in the industry. Yet the blockchain space is fast-moving and constantly brimming with new projects that could make the sharing economy increasingly accessible to all. This is a list of some other projects to look out for in this space:

1. Helbiz

Helbiz is a startup creating a marketplace that allows people to share not just cars, but any vehicle — bikes, boats, and other modes of transportation. Using both hardware and software, the idea is to be able to turn entire vehicles into Internet-of-Things (IoT) devices that it can be unlocked with a smartphone, tracked with GPS, and monitored for problems and maintenance. The Helbiz app will allow users to unlock vehicles and pay for vehicle usage in cryptocurrency. Though innovative, there are other organizations developing similar capabilities in the shared mobility space including HireGo and Xain.

2. Open Bazaar

Though there are other decentralized marketplaces that use blockchain technology, OpenBazaar was the first of its kind and is still going strong. Users are able to pay for goods in over fifty cryptocurrencies. Since there is no company or entity running it, there are no fees or limits to what can be bought or sold. Though significant technical differences exist, for the casual user, up-and-coming challengers such as Swarm City, Public Market, and Blockmarket will offer similar services with different features.

3. Sarafu-Credit

As a country, Kenya has been one of the fastest countries in the world to wholeheartedly embrace mobile money and mobile payments, with two-thirds of the population using it on a daily basis. So, not surprisingly, it is also among the first countries where blockchain-enabled community currencies are being used by merchants who might otherwise be too cash-strapped to transact with each other. The organization Grassroots Economics has been operating multiple community currencies in Kenya and and South Africa for the past few years to increase the buying and selling power of various communities. Recently, in partnership with blockchain-startup Bancor, Kenyan vendors have been signing up to accept cryptocurrency versions of these community currencies which they already accept in paper form.

4. Chamapesa

Another Kenya-based project making use of Kenyans’ high rates of adoption in mobile banking is Chamapesa, which is using blockchain technology to facilitate lending circles with smartphones. The organization has pointed out that it is not trying to change any core behavior, but rather is using blockchain to facilitate this type of community finance scheme — in one tweet, it said “We’re not changing Chamas behaviour except that instead of using paper books were going to be using smart phones.”

5. Holochain

Although the proponents of Holochain proudly stand by the fact that it is not a blockchain, for the layperson Holochain has very many similar use-cases. One main difference is that it comes without the prerequisite of using the enormous amounts of energy required by “proof-of-work” blockchains like Bitcoin and Ethereum, yet it is still possible to run a blockchain exactly like Bitcoin on Holochain. Instead of having only one global agreement about what data is valid (as with a regular blockchain), individual users create their own intermeshed ledgers of valid data and personal histories.

Additionally, whenever we access a website on the Internet, we are really accessing information hosted on servers operated by some third party — usually in a location we don’t care about, owned by a separate private company. What Holochain makes possible is a blockchain-like method and reward structure for storing and accessing data and applications between users themselves, without having to rely on these third parties. This makes it possible to create and run applications of any sort between users, allowing the operation of a truly peer-to-peer internet.

6. Right Mesh

Only about half of the world’s population has regular Internet access, which means billions still do not have the ability to take advantage of web-based peer-to-peer technologies. Right Mesh is working to change that by allowing people can create their own networks with limited access to internet using mesh networking.

In a mesh network, information leaps between phones, computers, and other devices like frogs on lily pads until it gets to its destination. It does this by using these devices’ ability to connect directly with each other via Bluetooth or Wifi without being linked to the Internet itself. By encrypting the information — whether it’s a message, image, or payment — the network can ensure that only the desired recipient can understand and make use of the message, which opens up a host of mesh applications that can run on peer-to-peer devices in the absence of internet. Other mesh networks and mesh software already exist, but by using blockchain, this network will allow users to get paid for providing content to peers and existing as an infrastructure of the network itself, offsetting hardware and battery costs of doing so.

7. Beenest

Just like AirBnB, the platform Beenest connects hosts with potential guests and leverages blockchain technology to keep costs down. If using its own cryptocurrency — Bee Token — no fees or commissions are taken by the platform on booking and listing properties and charges lower fees than AirBnb when using other currencies or cryptocurrencies.

8. Possible

Possible is a Netherlands-based project is intended to increase social capital by giving people incentives to do the work that might not normally earn money, yet is crucial for healthy societies. Possible is a time bank, meaning that it enables individuals to offer up and use each other’s services denominated in hours of time rather than in some other unit of currency. Time banks have been around for well over a century, but they are often volunteer run and administering them using a centrally-managed database can, at times, prove difficult. By using blockchain technology to and decentralize who gets to update the database, projects like Possible could make it easier to operate time banks without having to rely on volunteers.

9. ShareRing

ShareRing is developing an app that uses blockchain technology that will allow users to find and search for nearby services and actually share anything with each other. Like a truly decentralized library of things — both physically and digitally — ShareRing could maximize the usage people get out of physical objects by enabling people to share them easily and fairly. The idea is to have a truly global network, so that the ShareRing app can be used to find and pay for similar services no matter where in the world a person  may be. The app will use two of its own cryptocurrencies: one that allows merchants to access the blockchain, and the other as a currency for paying for services on the platform.

10. Digital Town

Platforms like Amazon, Uber, and AirBnB offer useful services but continuously extract wealth from those who generate it though high fees, which are paid to these companies and their shareholders. Digital Town [one of Shareable’s sponsor] aims to change this business model by linking users in specific geographic localities with the information, resources, and services they need, but instead of extracting high fees, but instead of extracting high fees will ensure more of the profits generated locally, stay local.

With DigitalTown’s blockchain-based solution, merchants and consumers are rewarded for engagement. Merchants receive a free storefront with low commission rates and everyone receives a free SmartWallet, which supports traditional and cryptocurrencies. Businesses pay just a 1% payment processing fee and everyone enjoys free peer-to-peer transfers.

DigitalTown’s tools make it easy for communities to share content, discussions, events, and projects. Users of the platform are rewarded with CommunityPoints. Merchants can use CommunityPoints for marketing campaigns on DigitalTown and consumers can use CommunityPoints with participating merchants.

Header image by John Schnobrich on Unsplash.

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Aaron Fernando: Education can take many forms, including the form of play itself. The TESA Collective is a co-op that creates games for various social justice organizations. It has worked directly with number groups, including unions and nonprofits, and its games now facilitate workshops and trainings that result in real-world social change — in addition to being used during casual get-togethers.

By using board games, groups are able to work through strategies and practice collaboration and organization in a low-risk environment. While this happens, the campaigns and projects that these groups are working on in their daily lives are kept in mind and used as context. Playing these games then becomes self-directed training around how to organize — training which plays out when people actually organize around issues like water management or workers’ rights.

For instance, TESA recently worked with The Nature Conservancy, one of the largest conservation nonprofits, to create a game specifically focused on dialogue and mobilization around water resource management. The resulting game, called “Water for Tomorrow” was built out by TESA hand-in-hand with The Nature Conservancy for its New York water management campaign with the same name as the game.

Organizations can choose to work with TESA and build games related to their causes and missions with varying levels of involvement. The Nature Conservancy took a highly involved approach over eight months and designed a game that would be fun to play, yet serious and complex enough to serve as a real educational material around water management.

“We use it as an engagement tool,” says George Schuler, director of conservation science and practice at The Nature Conservancy about “Water for Tomorrow.” “Instead of going into a community and showing them PowerPoints, we use the game as a way to get people talking about what are the challenges they face in their communities or in their own lives. … It’s almost a community engagement tool — instead of having a public hearing or a town hall meeting, we have game night.”

Photo courtesy of TESA Collective

Schuler and his team have noted that gameplay generates far more engagement and conversation than simply giving a presentation or lecture. “The game is targeted at what we call casual experts all the people that have a stake in water decisions or are affected by water decisions of others,” says Schuler. Each player acts as a stakeholder — farmers, local politicians, business owners, and so on — and often take on a different role than the one they play in reality. This approach helps people bring in their own experiences and collaboratively discuss water management in a much more open and relaxed setting than if they were listening to a lecture.

Although “Water for Tomorrow” is currently only used by The Nature Conservancy, one of TESA’s other games titled “Rise Up: The Game of People & Power” was created with sponsorship from a labor union Service Employees International Union (SEIU) and is publically available.

SEIU,which has approximately 2 million members in the U.S. and Canada, distributes “Rise Up” to its board and local chapters, but also uses the game during its Social Justice Leadership Academy. During this annual meeting of union member leaders, playing this game is one of the activities that gets members to think about strategizing and organizing in a hostile political environment.

Photo courtesy of TESA Collective

In Rise Up’s gameplay, people must cooperate to challenge “The System” in ten areas — internet, environment, government, and campuses. The game is difficult to win because the odds are stacked in favor of The System. “Our members work very hard every day and see that the economy is stacked against them,” says Ragini Kapadia, former Education Coordinator at SEIU who used the game during the trainings. “And through their lived lives, have experienced a rigged system.” Yet that’s the point of the game: for people to learn how to organize and bring about meaningful social change in reality. “We used a lot of real-life scenarios,” says Jeremy Wilson of SEIU about using Rise Up in the Social Justice Leadership Academy. “The game takes place in the context of the specific campaign you’re talking about — so maybe it’s the Fight for $15 (minimum wage) in a specific place. It’s a more accessible, fun way to do some of the hard thinking and hard teamwork before you actually get in the field and have to do it.”

TESA may be best known for its first game “Co-opoly,” which was launched in 2011. In “Co-opoly,” players play characters with different incomes and family sizes and like most games created by TESA, the game is cooperative so all players either win or lose together, depending on the success of their co-op.

In fact, when founding member Brian Van Slyke and a friend started TESA during the recession in 2008, the “intention wasn’t initially to get into games for social change,” says Van Slyke, adding that building games was just one part of the educational programming and development that they had been doing for various nonprofits. “But because of the initial success of ‘Co-opoly,’ that just naturally and organically took us down that road.”

In a piece on Truthout Van Slyke delves into the history of using games for educational and political purposes. Among many, these include a board game titled “Suffragetto” which was created by a women’s suffrage organization over a century ago and a critically-acclaimed computer game called “Papers Please” in which one plays an immigration officer in a corrupt dystopia.

“Rise Up” is TESA’s most recent game, but after the 2016 election, the TESA team observed that perhaps the game was a little too real, with so many social battles being fought against “The System” in reality. “People were playing the game, and they just looked tired,” says Van Slyke. “People just seemed like the world was crushing them.” So TESA decided take a somewhat lighthearted approach to their next game for battle-weary social justice organizers. Its title? “Space Cats Fight Fascism.”

Header image of members playing Rise Up during their trainings courtesy of SEIU

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Aaron Fernando: On July 3, the Co-operative Party in the U.K. launched a report at parliament outlining a strategy to double the size of the U.K.’s cooperative sector by 2030. The report, written by the think tank New Economics Foundation (NEF), was commissioned by the Co-operative Party and comprises a vision of the party’s goals. The report, titled “Co-Operatives Unleashed” reviews the current state of the co-op sector in the U.K., features case studies from other European nations, provides a snapshot of existing hurdles for the co-op sector, and offers policy recommendations for advancing this sector.

The report outlines the economic benefits of economies with healthy co-operative sectors. It cites statistics showing that co-ops have a 25 percent higher chance of surviving their first three years of operation than conventional businesses. They also have lower staff turnover and  lower pay inequality. The report notes that “the five largest co-operatives paid 50 percent more corporate tax than Amazon, Facebook, Apple, eBay and Starbucks combined.” In 2017, the U.K. had approximately 6,000 co-ops with 13.6 million members — lagging well behind most other OECD countries, according to the report. Meanwhile, workers in the U.K. have seen wages stagnate for 150 years and any economic growth has mainly benefitted a very small portion of the population, the report notes.

Yet “Co-Operatives Unleashed” stops short of advocating for co-ops as a total replacement for traditional businesses, and acknowledges that co-ops can face issues regarding scaling and may not be suited for “sectors involving high capital intensity… due to the higher cost and risks that members would bear.” Rather, the report advocates that co-ops should function as complement to traditional businesses. “When you look at the UK economy in light of Brexit and the challenges faced in the U.K. economy, a lot of those problems are symptoms for the fact that in the U.K. there isn’t a strong enough mix of different types of ownership,” says Ben West, communications officer with the UK Co-operative Party.

The UK Co-operative Party was founded a little over a century ago in 1917. A decade later it entered into an electoral pact with the Labour Party, agreeing not to run candidates against each other and sometimes running joint candidates under the Labour and Co-operative banner, says West.

Under this alliance, the 2017 Labour Party Manifesto contained the express commitment “to double the size of the co-operative sector in the UK,” the detailed strategy of which is laid out in this report. Though Labour Party, led by Jeremy Corbyn, is currently the opposition, “this piece of work is saying that if a future government of whatever party wanted to take on that commitment and make it happen, [these] would the steps be in order to actually deliver that,” West says.

It is noted in the report that the governments of counties with highly-developed cooperative sectors are obligated to recognize and promote co-operative businesses just as they would traditional enterprises — and that the same practices should be adopted in the U.K.

“When you look at other European countries, within their economies, a lot of their success is that there’s a really broad mix of different ownership types,” West says, citing the German energy and banking sectors specifically, where there is a mix of municipal entities, private firms, and socially-owned cooperatives.

The report puts forth a specific strategy of five interlocking steps for achieving this goal in the given timeframe:

1. A new legal framework for co-operatives

2. Finance that serves the co-operative agenda

3. Deepening co-operative capabilities through a Co‐operative Development Agency

4. Transforming business ownership

5. Accelerating community wealth building initiatives

These steps include the development of a legal framework which supports the development of future cooperatives and removes disincentives for cooperative growth. Specifically, this would involve the creation of legal structures, financial instruments, and mechanisms that co-ops can choose to use which would allow them to do things like lock in assets and wealth earned in the co-operative economy so that it stays in the cooperative economy.

Another strategy involves legally formalizing the ability for employees to buy existing businesses and transform them into co-ops. According to figures in the report, there are approximately 120,000 family-run small and medium enterprises that will undergo an ownership transfer in the next three years. If only 5 percent of those businesses transition into some form of co-operative model, the U.K.’s cooperative sector would double in size. As such, one of the strategies involves streamlining this type of transition.

Other policy recommendations in the report include technical support and information sharing for the sector, tax advantages for cooperative businesses, and the establishment of a National Investment Bank with “a mandate to supply patient risk capital specifically to the co-operative mutual and social enterprise sector.”

The strategy is multifaceted and ambitious, but the goal is for it to take place gradually over the next twelve years. “The mission now is as it was in the beginning: to stand up for the interests of the co-operatives that exist in the U.K., where there are laws that are holding back their expansion,” West says. “We want to create a favorable environment for cooperatives.”

The full report is available here.

Header image is screenshot from the report.

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Aaron Fernando: Blockchain has become one of those buzzwords that commands attention and carries a powerful social glow, yet in the likes of similar buzzwords that have attained such a prized status, it has lost much of its meaning. Blockchain has become a catchall term for just about any digital ledger system regardless of crucial variations in its design. With so many blockchain projects ranging from social impact initiatives to opportunistic marketing ploys, it can be difficult to discern which projects hold real potential. For this reason, here’s a deep dive on blockchain applications in our niche: social impact.

The volatility in the price of cryptocurrencies doesn’t matter to restaurateur Helena Fabiankovic, who started Baba’s Pierogies in Brooklyn with her partner Robert in 2015. Yet she and her business are already positioned to reap the real-world benefits of the technology that underpins these digital currencies — the blockchain — and they will be at the forefront  of a sustainable, community-based peer-to-peer energy revolution because of it.

So what does a restaurateur have to do with the blockchain and local energy? Fabiankovic is one of the early participants in the Brooklyn Microgrid, a project of the startup LO3 Energy that uses a combination of innovative technologies — blockchain and smart meters — to operate a virtual microgrid in the borough of Brooklyn in New York City, New York. This microgrid enables residents to buy and sell green energy directly to their neighbors at much better rates than if they only interacted with centralized utility providers.

Photo of Helena Fabianokovic of Baba’s Pierogies courtesy of LO3

Just as we don’t pay much attention to the critical infrastructure that powers our digital world and exists just out of sight — from the Automated Clearing House (ACH), which undergirds our financial system, to the undersea cables that enable the Internet to be globally useful, blockchain is likely to change our lives in ways that will eventually be invisible. In the sharing economy, we have traditionally just used existing infrastructure and built platforms and services on top of it. Considering that those undersea cables are owned by private companies with their own motives and that the locations of ACH data centers are heavily classified, there is a lot to be desired in terms of transparency, resilience, and independence from self-interested third parties. That’s where open-source, decentralized infrastructure of the blockchain for the sharing economy offers much promise and potential.

In the case of Brooklyn Microgrid, which is part of an emerging model for shared energy use via the blockchain, this decentralized infrastructure would allow residents like Fabiankovic to save money and make sustainable choices. Shared ownership and community financing for green infrastructure like solar panels is part of the model. “Everyone can pay a different amount and you can get a proportional amount of energy that’s put off by the panel, based on how much that you own,” says Scott Kessler, director of business development at LO3. “It’s really just a way of crowdfunding an asset.”

The type of blockchain used by the Brooklyn Microgrid makes it possible to collect and communicate data from smart meters every second, so that the price of electricity can be updated in real time and users will still transact with each other using U.S. dollars. The core idea of the Brooklyn Microgrid is to utilize a tailored blockchain to align energy consumption with energy production, and to do this with rapidly-updated price information that then changes behavior around energy.

One of the Brooklyn Microgrid’s core goals is to upend traditional energy pricing and change people’s energy use by adjusting pricing in real time. All of this happens on a local level, between neighbors. “I really like the idea of the community sourcing energy to one another,” Fabiankovic says. “I thought it was a smart way of sourcing energy, and we try our best to maintain sustainability as well, whenever we can. So this is just another way to do that.”

Localizing the energy grid is indeed a smart way of sourcing energy that also offers a way to reduce a neighborhood’s carbon footprint. “What we’re trying to do is create a real tight market that reflects the time value and the locational value of where energy is used,” says Scott Kessler, director of business development at LO3. The Brooklyn Microgrid utilizes LO3’s hardware, but it’s the blockchain-based software that really does the legwork, providing a kind of infrastructure layer for the energy-sharing economy. LO3 is not the only organization doing this — groups like Power Ledger, Swytch, and WePower, are experimenting with other versions of blockchain-based P2P energy grids.

Photo of LO3 founder Lawrence Orsini, courtesy of LO3

What exactly is a blockchain?

Before diving further into the uses of the blockchain in shared enterprises, let’s take a quick look at how exactly this emerging technology operates. In its original form, the term blockchain refers to a type of database that is permanent, public, distributed and uses cryptography for security. Here, distributed means that multiple computers simultaneously update and store data once they have come to a consensus about which data makes the cut. Permanent and public means that all changes to this type of database will be visible to all, going back to the moment the database was started.

Yet there are exceptions, and the term blockchain is becoming increasingly vague as many networks marketed as using “blockchain” are often not public or distributed in any meaningful way. Crucially, not all blockchains have a native cryptocurrency, which are the exchangeable digital money-like units with a market price. For blockchains that do have a native cryptocurrency, units of cryptocurrency are usually issued into existence as incentives for running and securing the network. This occurs either through a process of repeated, energy-intensive computations called “mining” or through other means.

Mining has fueled criticism about some blockchains’ enormous use of electricity, especially mining on the Bitcoin blockchain which eats up more energy than many countries. The practice of mining however, is becoming outdated as more efficient mechanisms of securing blockchains crop up. Moreover, as demonstrated by up-and-coming sharing economy entities that utilize blockchains, the technology isn’t limited just for speculative assets like Bitcoin or other cryptocurrencies. Organizations around the globe are finding innovative ways to use blockchain for as a mechanism for good, providing the powerful rails that the sharing economy of the future runs on.

Blockchain for a better economy

One organization creating these rails is Origin, which is working to reduce the cost, difficulty, and barriers to entry for building marketplaces, enabling people to build truly peer-to-peer marketplaces on the blockchain. In creating this kind of decentralized underpinning, blockchains offer communities alternatives to one-size-fits all solutions and economies of scale.

“Decentralization will enable people to self-organize and have more unique or highly-localized offerings,” says Coleman Maher, who handles Origin’s partnerships. “It’s convenient from a user experience perspective, in some ways, that AirBnB is the exact same experience in San Francisco as it is in Rio de Janeiro as it is in Tokyo. But all those cities have different cultural environments, regulatory environments, and different specialized, local concerns. It doesn’t really make sense that the same organization is running the home-share market in these three, vastly different cities. We think it makes sense that home-sharers host self-organized get-togethers and say, ‘Hey, we want to have our own home-sharing decentralized marketplace that’s fair to us and fair to our guests. We don’t want to have to play by AirBnB’s rules.'”

Another crucial part of the sharing economy infrastructure is financial infrastructure. Consider the two billion unbanked and underbanked adults around the world. Can blockchain benefit them as well? WeTrust is one of the blockchain startups working to do this, and has already put out a lending circle product on Ethereum, the second most popular blockchain after Bitcoin.

Lending circles (also called money pools, tandas, susus, chit funds, and a whole lot of other things depending where in the world you are) facilitate shared community finance and peer-to-peer credit for those who do not have the ability to take out bank loans. Plus, lending circles have “been around and used by millions of unbanked people for millennia,” says Jake Kuczeruk, former director of partnerships at WeTrust. Lending circles are democratic and allow people to lend to their peers without requiring any financial institution to mediate them — practically, at least. Regulation is another story. Still, “most of these circles are being done with cash, with fiat currency, which obviously has some real safety and security issues, not to mention just being crazy inconvenient,” Kuczeruk says.

Since blockchain can deal with these issues, reduce administrative costs, and increase transparency, WeTrust sees potential in applying this technology to people’s existing behavior around finances. “We’re realistic here,” he says. “Bitcoin and blockchain technology in general only have about a 15 million person ecosystem. Obviously the global unbanked/underbanked aren’t really familiar with this technology yet … But now we’ve reached a point where it’s like ‘Hey, this is live. Let’s sit down together, we’ll walk you though this.’ Because at the end of the day, we want to make this as easy to use as Venmo.”

Other startups are taking a different approach. Companies like Kora are making the blockchain immediately accessible to populations in need of financial services by finding ways to integrate it with technologies they already use, such as mobile phones.

In addition to creating what is effectively an open-source payments infrastructure, Kora has been working directly with a range of groups — from farmers in Nigeria to coffee producers in Peru to a cooperative in Bangladesh — to make financial products that are accessible and work for groups that may otherwise go without them. The blockchain allows these groups to access financial services at a lower cost, increase transparency around where their funds are and how they get used, and allow projects to scale up more easily. “We just think about what users need, and then blockchain just happens to be a nice way to get there,” Maomao Hu, co-founder and chief operating officer of Kora, says.

Kora staff member with farmers. Photo courtesy of Kora

Plus, the types of groups that stand to gain the most by integrating blockchain into their daily lives are very often the existing sharing economy entities that were disadvantaged by traditional finance and market forces. “Everywhere we go, the co-op has become a centerpiece,” Hu says. “They’re a really powerful structure for raising economies of scale, locally. The blockchain is actually this really powerful tool that almost overlaps, word for word, with some of the academic research that’s been done on co-ops.”

Another player using blockchain in the financial inclusion space is Moeda, a cooperative crypto-credit banking platform. “Moeda provides a transparent impact investment platform to impact investors and a banking-as-a-service platform to entrepreneurs who will be receiving loans to not only fund, but to scale and grow their businesses,” Taynaah Reis, CEO of Moeda, told Shareable in 2017. “In turn, their local communities will directly benefit.” Moeda has provided a round of microloans and seed funding for businesses in Brazil, and has partnered with a network of agricultural cooperatives in Brazil called Unicafes to do so.

Not all that glitters is digital gold

But there are still quite a few reasons to be wary of using blockchains. Emin Gün Sirer is computer science professor at Cornell University and co-director of the Initiative For Cryptocurrencies & Contracts (IC3), a group of academics and researchers working on cryptocurrency and blockchain development. Sirer created a digital distributed currency, Karma, that predated Bitcoin and is also familiar with the sharing economy and its reluctance to embrace blockchain. “Deep down, the underlying ethos is different,” says Sirer, about the two worlds. “In one, you have these highly individualistic, highly profit-driven people and they want to make money. And in the other, you have the exact opposite type of people. They want to make the world a better place and they don’t care about personal monetary compensation, typically.” But, Sirer explains that many in the latter “have a bootstrapping problem, they find it difficult to raise money.”

“But at the intersection of these two worlds are fantastic ideas. If you can come up with something that is easy to bootstrap, that does have some incentives built in for the people operating the schemes, and also makes the world a better place — then we’re talking. And we’re beginning to see such projects.” Some, like Chelsea Rustrum, co-author of the book “It’s a Shareable Life” and a contributor to Shareable, are focused on reconciling these two worlds so that they can work together. Rustrum started a group called Blockchain for Good which runs regular meetups in the San Francisco Bay Area and New York City and has also organized around diversifying this space, since women are severely underrepresented in the blockchain space, and minorities are still underrepresented in the tech industry.

Blockchain for Good meet up photo courtesy of Chelsea Rustrum

But other problems still exist. This ecosystem is still rapidly emerging. As such, applications and code are getting deployed as fast as possible by startups that feel acute pressure to move first — lest they allow competitors to swoop in, dominate a niche, and lock them out of the market. This rapid pace has made it particularly easy to lose funds due to hacks resulting from bugs in code and mistakes, in addition to scams and phishing attacks that prey on those new to the ecosystem.

Furthermore, the regulatory environment around assets issued and sold on a blockchain remains highly uncertain, and laws are playing out differently across countries and individual states. Decisions about whether certain types of blockchain assets are securities, commodities, money, or a new asset class are still being made and are changing over time. On top of that, a few Initial Coin Offerings (ICOs) have been outright scams, and many others are nothing more than honest, but inadequate ideas presented in a whitepaper, along with a website and some team photos.

Blockchain for cities

Still, the idea of crowdfunding on the blockchain goes beyond ICOs. Cities are finding innovative ways to use the blockchain to raise and distribute funds for public projects. In the U.S., the city of Berkeley in California announced that it would be using blockchain as the backbone for municipal bonds, allowing for more flexible funding for small directed projects, along with increased transparency. Importantly, this model would allow the less-wealthy residents of cities to peer-fund small projects in their locality and receive a financial benefit from doing so. “Normally, because the bonds are so expensive — these fiduciary firms  looking to scale their profits,” says Ben Bartlett, Vice Mayor of Berkeley. “They disallow small projects. You have to pay $100 million [to issue a bond], and things like that. But this way you can issue a bond for something small like a firetruck.” And that’s exactly what Berkeley is planning on doing.

Photo of Berkeley City Council meeting by Scott Morris

Separately, the City of Austin recently announced that it plans on using blockchain technology to provide identity services to its homeless population, simplifying the process of offering services and benefits to a demographic that frequently runs into obstacles due to lack of identity.

This is where the concept of a self-sovereign identity comes in. Simply put, a self-sovereign identity on the blockchain is a permanent identity that can only be accessed in full by the person or entity to whom it belongs, yet portions of that identity can be shown to any individual, organization, or agency whenever it becomes relevant. Since self-sovereign identities are decentralized and encrypted, identity theft or incidents like last-year’s Equifax hack become much less of a problem.

The existence of self-sovereign identities could allow individuals and small organizations to verify information about each other without having to go through third parties, again facilitating peer-to-peer uses. For example, instead of waiting on a credit report for a rental application, a landlord would be able to verify an applicant’s rental payment history, after the applicant chooses to authorize the landlord to see that information. Furthermore, the existence of self-sovereign identities would allow startups, NGOs, and government agencies to provide services to beneficiaries  and vulnerable populations while granting agency and protections to recipients of those services.

Blockchain for education and aid

One organization moving toward implementing a self-sovereign identity indirectly by providing a different set of services first is Amply near Cape Town, South Africa. Similar to the way a person could fund a new fire truck in Berkeley, they might also fund an educational center facilitated by blockchain. In Durban, some early childhood development centers receive government subsidies based on how many children attend its programs, but to date, the recordkeeping for these centers have been done on hand, on paper. As a result, the quality of the data is quite low and reporting is cumbersome.

Amply’s smartphone app simplifies the process of recording student attendance, and the organization aims to increase the app’s versatility via blockchain in quite a few ways. “The longer term goal, also here is that each child and staff member gets a decentralized identity (a DID). That identity, we hope, will eventually build up to become a self-sovereign identity,” explains Joyce Zhang, project lead at Amply.

By using a blockchain to track specific outcomes, Amply and partner organization ixo will make it significantly easier and more transparent for the South African government, nonprofits, and individual donors to measure and track impact with high levels of precision. If widely adopted, this won’t just make it easier for entities to see where their funds have the greatest cost-to-impact ratios, but it will vastly simplify and enable the sharing of impact data and information about what works between organizations and across borders — all while protecting the sensitive information of vulnerable populations.

Photo courtesy of Amply

Potential donors can decide that “this is a really cool project, I want to donate $100,” says Zhang, who is also the program manager at ixo. “And then for those attendances, instead of the teachers getting it from the government, they can get it from private funders or whoever else is using this system.”

One of the main aspects of the blockchain is that when any type of information gets put onto it, it is unfeasible and nearly impossible to alter or delete that information at a later time. On a secure blockchain, a record is a record and it always will be.

Blockchain as a public good

This is particularly useful for certain purposes that have nothing to do with transactions or markets, such as sharing information in the face of censorship from powerful or moneyed adversaries. The journalism platform Civil is tapping into this potential to permanently secure information in the public domain. Once something is published on Civil (planned to launch later this year), the platform enables a permanent archive of the content to be logged in the Ethereum blockchain so that no one — hackers, new management, or unsympathetic government — can alter or delete that content for private gain.

This is not a theoretical threat. In 2016, the Hungarian newspaper Nepszabadsag (People’s Freedom) was abruptly shut down and all of its records were taken offline in retaliation for its criticism of Hungary’s Prime Minister Viktor Orban. Closer to home, the Trump administration has taken down the Environmental Protection Agency’s climate change webpages, though its archives are still available.

In fact, the founders of the Civil platform created this functionality in response to incidents faced by local websites recently. In a post Daniel Kinsley, engineering lead at Civil, wrote that, “In 2017 alone, DNAinfo and Gothamist, two of the leading, local news-focused publications in the U.S., were abruptly shut down by their billionaire owner. Eight years of archives were taken down in a single day, and were only restored after vociferous public protest.” Yet by storing or backing up journalistic on decentralized blockchains, inadvertent censorship of this sort, as well as purposeful censorship will be much less of an issue.

Today’s media makes it nearly impossible to be level-headed about the potential for blockchain. It has a few reputations, all of which are extreme: blockchain as a technological panacea; blockchain as the driver of an apocalyptic crypto-bubble fueled by speculators, scammers, and ponzi schemers; blockchain as a force of revolution that will overthrow governments and bring entrenched industry incumbents to their knees.

It’s possible that certain aspects of of all of these visions will be realized, but eventually much of the sound and fury will subside, outlived and overtaken by the use cases that actually serve people on a day-to day level. Originally conceived as a peer-to-peer technology, the brunt of blockchain’s potential still lies in its ability to serve as the technological underpinning for the sharing economy and facilitate financial inclusion, information sharing, and even democratic self-governance and local governance.

When we find ourselves in a world fully immersed in blockchain, we will find that it is a permanently transformed one — one where cooperatives, schools, and neighborhood groups have many of the same technological advantages as governments and multinational corporations. But it will also one be a world that we take for granted and just seems normal — as normal as today’s world of electric light, wireless internet, and satellites in space.

Header image of the Brooklyn Microgrid project courtesy of LO3

Curious to learn more about the projects mentioned in this piece? Read these Q&As for a deeper dive:

• A blockchain for farmers and co-ops: Q&A with Kora’s Maomao Hu​
• Blockchain and the potential for local P2P power: Q&A with LO3 Energy
• Civic crowdfunding with the blockchain: Q&A with Berkeley vice mayor Ben Bartlett
• Blockchain for education in South Africa: Q&A with Joyce Zhang from ixo and Amply
• Blockchain-powered journalism: Q&A with Matt Coolidge of Civil

Do you have any leads for stories about how other organizations are using blockchain for good? Contribute your ideas to Shareable’s Collaborative Storytelling Project. And sign up for our weekly newsletter to stay on top of upcoming events and reader engagement projects around this story and more.

The post Blockchain as a force for good: How this technology could transform the sharing economy appeared first on P2P Foundation.

Aaron Fernando: The concept of ownership is a social contract that allows certain individuals and groups to have rights to certain resources or items while excluding others from that access. Under the mainstream conception of private property, both the ownership of land and anything built on top of it are combined into one. This bundling of land and buildings is often problematic — it puts neighborhoods and residents of cities in an unnecessarily precarious position by making them subject to the whims of land speculators.

This form of land ownership also prices out locals from areas that they historically lived and worked in by increasing costs — catalyzing the process of gentrification. It also privatizes and encloses common spaces and areas that previously benefitted surrounding communities, ultimately leading to a more fragmented society, one required to focus on uownsustainable short-term profits. All this holds true as long as land remains on the market.

Yet what we see today is a resurgence and re-invention of ownership models that allow communities to take care of themselves and steward their own natural resources. The Community Land Trust (CLT) model is one that reduces the socially-destructive effects of market forces by separating the ownership of land with the ownership of any property and equity atop the land itself.

Affordable housing-related CLTs are probably best-known, but this model can be applied for any community goal, including lowering costs for small businesses and ensuring local food production. Though the CLT model has been re-emerging since the late 1960s, it is actually somewhat of a return to indigenous practices around ownership of land and resources.

Winona LaDuke, anti-pipeline activist, water protector, and member of the Ojibwe nation spoke about this during the 1993 Annual E. F. Schumacher Lectures. “Our traditional forms of land use and ownership are similar to those of a community land trust,” LaDuke said. “The land is owned collectively, and we have individual or, more often, family-based usufruct rights: each family has traditional areas where it fishes and hunts.”

Typically, a community land trust works by having a nonprofit (the community land trust’s legal entity) own the land and lease its long-term use to individuals — usually for 98 years. These leaseholders own anything that sits on top of the land, so if they make any improvements to their houses or other buildings, when they sell their buildings they can recover the buildings’ equity.

There is a fitting circularity at the root of LaDuke’s statements, because these lectures are hosted by the Schumacher Center for a New Economics (where I work and where LaDuke will again be speaking), a nonprofit co-founded by Bob Swann, who was also one of the pioneers of the first community land trust in the United States.

The Indian Line Farm. Photo courtesy of Amelia Holmes/Schumacher Center for New Economics

Another CLT started by Bob Swann in the Berkshires region of Western Massachusetts has put in place an additional innovation to ensure sustainable land stewardship. The Indian Line Farm gives farmers equity in not just their buildings, but the soil itself. A soil sample was taken at the start of the lease and another will be taken if farmers decide to move away. The farmers are entitled to the equity generated by any organic improvements to the soil on the land, in addition to improvements on the buildings.

On a deeper level, this leads to the question of whether natural resources can be owned at all. “In our language the words Anishinaabeg akiing describe the concept of land ownership. They translate as ‘the land of the people,’ which doesn’t imply that we own our land but that we belong on it,” LaDuke said.

As LaDuke explained, for the Ojibwe land and resources are managed as a commons.

“We have ‘hunting bosses’ and ‘rice chiefs,’ who make sure that resources are used sustainably in each region,” LaDuke said. “Hunting bosses oversee trap-line rotation, a system by which people trap in an area for two years and then move to a different area to let the land rest. Rice chiefs coordinate wild rice harvesting. The rice on each lake is unique: each has its own taste and ripens at its own time. We also have a ‘tallyman,’ who makes sure there are enough animals for each family in a given area. If a family can’t sustain itself, the tallyman moves them to a new place where animals are more plentiful. These practices are sustainable.”

If this sounds familiar, it may be because Elinor Ostrom won the 2009 Nobel Prize in Economics for analyzing and popularizing these ideas, debunking the belief that a tragedy of the commons was inevitable without government intervention. Ostrom was awarded the prize “for her analysis of economic governance, especially the commons” after she looked into the practices of natural resource management of groups like the Ojibwe, who had been managing their resources sustainably for centuries.

As new economy movements and sharing projects gain traction around the country and globally, it is important and helpful to realize that this models are nothing new; they are a return to centuries-old sustainable practices. As Ostrom, LaDuke, and many others have noted, the main reason why the indigenous resource management and land-use practices were trampled down is because the courts refused to uphold property held in commons. Now, in the nick of time with the CLT models and others, this is slowly changing.

Header image of Winona LaDuke courtesy of Honor The Earth

The post How Indigenous Land-Use Practices relate to Community Land Trusts & The Commons appeared first on P2P Foundation.

Aaron Fernando: The staff at the nonprofit organization HullCoin has done something very unusual in the city of Hull in northeast United Kingdom. Residents of Hull can earn HullCoins, which can be used at various places around the city. It’s an innovative model. But how exactly does it work? To learn more about the group’s approach, we spoke with the two founding members of HullCoin, Dave Shepherdson and Lisa Bovill. Here’s what we learned.

Aaron Fernando: It seems like both of you have had significant experience in civil service before this the start of this project. Can you talk a little about that, and if that influenced you to start HullCoin?  

Lisa Bovill: I worked for the local authority for 20 years. I delivered and managed advice services — so that’s civil rights advice. I was also in charge for developing anti-poverty strategies for the city and as part of that, strategies to combat financial exclusion. So working with those who couldn’t get access to mainstream financial products and were penalized as a result.

At the same time, most local authorities across the U.K. were experiencing funding problems themselves — reductions in the amount they got from central government — which meant that they could do less to help people to manage their finances and less to  combat poverty.

That was really where this whole thing started, and we were looking for creative solutions. We looked at technology and emerging technologies as having potential to help us with that.

I notice many similarities between HullCoin and things like time banks and loyalty reward programs. Could you talk a little bit about the things that influenced you, and what types of programs were you looking at when you developed the concept for HullCoin?

Bovill: We do have a local time bank, and we work closely with the time bank. It’s similar in that we are looking at non-monetary value systems. But we are different in lots of ways: It’s not just an hour for an hour. We are looking for a reward system that isn’t based on time, it’s based on social outcomes. HullCoin has a value, in terms of being able to redeem it for goods or services in a way that a time credit doesn’t have. What we want to do is interact with the time bank in a way that allows us to exchange those non-monetary value systems with each other and to create something like a varied secondary economy.

Shepherdson: When we were looking at mutual credit systems and local currencies — there are a lot of local currencies in the U.K. — the predominant ones are the Bristol Pound and the Brixton Pound — what we saw was that there were mutual credit systems (such as time banks) which are user-to-user exchanges, but local currencies were all effectively pegged to fiat currency. Like Lisa said, we were looking around the anti-poverty strategy in the city and we wanted something that would be generated into existence through social outcomes.

We looked at Bitcoin and blockchain technology as a decentralized clearing house which gave us regulatory freedom. It was 2014 when we started looking at this. In the U.K. certainly, a lot of what was going on with Bitcoin and blockchain was still cottage industry. I mean, kids were still mining cryptocurrency in their bedrooms.

How does an individual HullCoin unit get issued? Is it backed by anything?

Bovill: We will work with a number of grassroots and local organizations that will be given an amount of the currency and then they will be allowed to set their own rules around how they issue it. With some guidelines — quite broad guidelines from us — so it will really be up to those people. We’re not planning to regulate this or be really hands-on in terms of about how you issue or what you issue for. It’s up to those organizations who work with the city to make those decisions.

Shepherdson: And it’s not back by any commodity. It’s backed by the community itself.

When one organization issues HullCoin, will it be the same type of HullCoin as when another organization does? And those can basically cross paths?

Shepherdson: Yeah, absolutely. The only thing that will differentiate between different HullCoins is that into each HullCoin, we insert software which documents evidence of positive social outcomes generated by the coin into the coin itself. An issuing organization — whether that be a charity, a local authority, the NHS, the university, schools, prisons, everybody who signed up for it will be able to insert positive social outcomes and that stays within their own transaction histories.

The person who generates the coin who has done the positive social outcome — that can be for self-improvement or volunteering, or it could be mentoring, or could be caring for relatives — that positive story stays with them on their wallet, on their app. It sits on there and any business or retailer that accepts HullCoin as a form of discount also receives a time-stamped copy of that positive social outcome.

What you get collectively, then, is distributed ledger of all the positive social outcomes that have taken place — in this instance Hull is the city — but essentially, could be spread across numerous geographies or within any context, really.

That’s really interesting. That leads to one of my questions that deals with why you used cryptocurrencies. I was looking your tweets and I came across a question you asked that I wanted to pose back to you: “Why would you create a local currency using blockchain over traditional digital payment systems.”

Shepherdson: We did a full appraisal of all the different systems and which we could use, including blockchain. Because we’d developed links with Feathercoin, we were able to obtain the skills to develop the distributed ledger (blockchain) infrastructure very, very cheaply.

What I think mutual credit systems — and any currency systems — have trouble with, is that at scale they become incredibly inefficient and it becomes more expensive the more successful that that you are.

One the things with local currencies: with paper, the more that you issue, the more your running costs and maintenance costs stack up. While we obviously have server costs around the surrounding tech, the actual payment infrastructure is incredibly efficient. Not only that — it’s incredibly secure at the same time.

We’re a social technology company which specializes in distributed ledger technology. The application of HullCoin in this first instance… This is something that could be genuinely valuable and is complementary to the economy as a whole, but provides that platform for the adoption of the technology.

If we’re able to achieve successful public penetration of [blockchain] technology, then other applications potential the blockchain technology become extremely attractive. If you think of Bitcoin as being the world’s first-ever programmable money then it has become a no-brainer to use the model we’ve landed on — and the fact that we’ve been able to develop the infrastructure and everything at a fraction of the cost of what the industry rates are.

I’ve noticed that there’s often a disconnect between the local currency folk and the digital technology folk — not just crypto enthusiasts but with FinTech and mobile payments generally. Do you encounter this disconnect at all?

Bovill: I think the reason is that one is all about grassroots and people and the other is digital — and therefore automated and not people-centered. But we have come from a background of services that engage with people, so we want to see technology that’s put into the hands of communities in a way that they never thought that the technology would.

But also, I think that it’s difficult when you have a more traditional model that’s trying to achieve something, and then technology comes along and enables you to do it in a different way but you’ve already got an established model. So then you have to switch to a different model, and it’s difficult to accomplish that.

Shepherdson: Now, I don’t know the inner workings of a chip and pin machine. All I need is confidence. As long as I have confidence when I use my contactless payment, I get a reassurance.

So it’s all built upon confidence. What we’ve developed in the last 12 months — the UX on this— it actually resonates with all the communities that were working within Hull and beyond. If you look at what was developed, there’s no mention of blockchain technology. That does not sell to the public. We benefit from the infrastructure internally. All we’ve got to do is build confidence with it.

Once people have done something and they go back to their accounts on the system and see that they have been credited with a balance, they feel that they have been paid. It feels like money. That’s the psychology of money. So we replicate the psychology of money within the system; the technology in terms of blockchain and Bitcoin, from the user side of things is completely irrelevant.

How do you see a local currency scaling? And is it a relevant question for a local currency to scale?

Shepherdson: I think a local currency can scale. I think local communities should own their own currencies.

Bovill: It can be local, but use the same model.

Shepherdson: You can basically share the platform. The way that we’ve designed the whole current platform is that you can take the front and down you can share the back-end and you can have your own customizable set of coins which are specific to your geography or your interests.

It doesn’t just have to be around a local area. You could have one which is specific to a college, education, or health. It’s interoperable in a number of ways and you can white label the same platform and it’s extremely efficient and cheaper to do so rather than developing anything from scratch.

Is there anything unique about the city of Hull it lends itself to success of a program like this? And in the best case scenario what do you hope to achieve with HullCoin?

Bovill: I don’t think there’s anything so unique about the city of Hull apart from the fact that it is a Northern city and every time there’s economic downturn, it’s just battered because the primary economy gets battered. There’s a disproportionate effect on the local citizens.

We were trying to — in our strategies — to prevent that. We were trying to think about some way to create economic resilience for cities like Hull and Northern cities like Hull.

Shepherdson: 90 percent of all of the world’s croutons are made in Hull. [Laughter]

I suppose Hull’s always had a bit of a rebellious streak to some historical extent. I like to think in some ways we plug into that. It is mostly beaten down. But again, when there’s issues like the things that we were looking to address that’s where innovation sometimes comes from— necessity, really.

If we can provide a mechanism which gives people an opportunity to contribute to their economy and their community and also helps themselves and it gains traction — if that achieves success and credibility then our work here is done.

Bovill: In terms ultimate aim, with the local currency, it is about trying to operate a key component in create a secondary economy. A secondary economy which matches unmet need with what would otherwise be wasted resources.

Shepherdson: And also, we have an interest and aspiration to linking with the universal basic income model of welfare. The current model of welfare that we have in the U.K. really is, I don’t think, fit for purpose. And it certainly isn’t fit for purpose in what I think we would determine is a post-automation economy.

You’re going to have to look at “what is value?” In a much broader economic sense then what is currently considered by Western governments. Hopefully what we’ve developed with HullCoin — both within its economic modeling and its blend of technology and application — is fit for purpose for the future model of welfare which reflects the changing economic activities people will be undertaking. You can have a corporate and a communal contribution to your economy, which is somewhat different from what it is now.

And you’re planning on doing an ICO (initial coin offering) as well?

Shepherdson: That’s aligned with our aspirations of creating a parallel currency. We’re working with the number of academics and some people within the blockchain sphere on putting together a draft whitepaper and we’re going to make an assessment whether that draft is fit for purpose, and then we’ll make an assessment whether or not we’ll do an initial token sale on a parallel currency.

The potential is certainly there and I think unlike what a lot of other blockchain crypto startups are doing, we’ve actually got an MVP (minimum viable product). We’ve got a track record, we’re close to market and if we get the economic modeling right we will be able to launch the cryptocurrency.

Image of Dave Shepherdson and Lisa Bovill courtesy of HullCoin

Photo by cactusmelba

The post The English City With Its Own Cryptocurrency: Q&A With the Founders of HullCoin appeared first on P2P Foundation.