Rion D'Luz wrote: >> In particular, we could move to peer-to-peer or friend-of-a-friend >> banking in which every individual and organization plays the role of a >> bank. > I've always found your idea about this pretty cool.
The open source Ripple project actually gives a little 'on topic' cover to the thread. Stanley originally asked about local systems, and if/why they might fail. Perhaps local systems fail because they are local? Paypal didn't fail. I don't get the motivation for wanting to keep a payment system strictly local. I can see starting something local (you've got to start somewhere), but I'd design with various scales in mind. Beyond that the local thing, I'll share some of my own experience: 1. It is a lot of work. 2. Economies are nonlinear systems, nonlinear system design is hard. There are dangerous failure modes in this area. 3. There are already other means of exchange, and so it is difficult to motivate what may come across as subtle distinctions. 4. Among other technical issues, people haven't personally embraced digital signature, and they will need to if a distributed approach is going to happen. This isn't a problem when you are dealing with commodities, but we are talking about credit, and identity is the central issue with credit. And finally, anatomy of success and failure: 1. The class of projects we're are talking about don't have kickback profit as the objective for the designers. Stanley specifically mentioned bypassing the vendor fees of the credit card racket. These projects would ideally operate as a set of standards that the public could pick up and use in a distributed fashion. Commons are some of the most valuable human assets, but among the most difficult to get rolling. 2. Some people say that the greatest asset of the Open Source movement is that failure is cheap. If only one in a thousand projects ever goes beyond one developer, and if only one in a thousand of those has success, you can still have a massively successful movement. I don't know if failure-is-cheap logic can apply to the topic at hand, but if it does then a number of failures isn't necessarily a bad sign. 3. This type of thing becomes like the atmosphere, invisible, so in a few generations, people forget how they started. People DO succeed at this type of project. People DID create and evolve the current banking system, it isn't something natural. People DID create and evolve the Internet, but that won't be immediately obvious to the next generation of humans. People DID create and evolve the patent system, just imagine the original bull session, "let's set up a system where I mail an idea to the king, he signs the paper, and then he stops everyone in the land from using the same idea unless I say it is OK." Ya, that's really gonna happen, oh wait, it did! (Maybe Rion is right--I do sound like a broken record). > What about a micro-lending schema similar to what is being done > in 3rd world countries. I guess that is sort of built in to friend-of-a-friend banking. -- Anthony Carrico
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