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The Facebook Group

With the aim of sharing information and resources on designed currencies, Feasta started a Facebook group in 2012 at https://www.facebook.com/groups/designercurrencies. The group has around 140 members worldwide and would be happy to have more.

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Thoroughly Modern Money at Green Drinks, Dunmanway

Phoebe Bright from the Feasta Currency Group will be whizzing through her presentation Thoroughly Modern Money – how to design your own currency, at The Arch, Dunmanway, West Cork on Tuesday 10th April 2012 at 8pm as part of Cork Environmental Forum’s Green Drinks. All are welcome.

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Liquidity Network 2011

While 2011 was a quiet year on the website, much discussion was happening behind the scenes as we thrashed out our thinking on how the Liquidity Network would work. We were also busy talking to potential test sites and that is leading to some real possibilities for 2012.

The untimely death of Richard Douthwaite in November, the founder of the group and tireless enthusiast, left us stunned. But our determination not to let Richard down has given us new energy.

As we start 2012, we have a number of tools for assessing the suitability for local currencies under development, we are (slowly!) getting together all our material to publish on this website and are progressing two locations for a Liquidity Network, one in Ireland and one in the UK.

If you are interested in becoming involved in the Liquidity Network project, please send an email to us at liquiditynetwork@feasta.org.

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Liquidity Network at Transition Tralee

Transition Tralee have invited us back to talk some more on currencies. Phoebe Bright will be speaking at the Fels Point Hotel on Wednesday February 29th on how to design a new currency and will also be demonstrating the Liquidity Network Prototype.

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LQN at Green Drinks in Cork

The LQN Prototype system had a quick outing at Green Drinks, organised by Cork Environmental Forum in Cork on thursday 16th Feb. Some interesting questions from those gathered and some pointers on how to improve the demo. Thanks to all who shared their time.

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A Liquidity Network would be legal in Ireland

Liquidity Networks would be legal. Just before Christmas, the group obtained a written opinion to that effect from Anthony Collins, S.C. The opinion looked at two issues.

The first was whether quid were currency or money in the eyes of the law and whether, if so, this might make the way we intend to issue them, and other aspects of our proposal, potentially unlawful.

The Opinion was that “Since [the quid] is neither prescribed by the law of Ireland nor is it intended to serve as the generally accepted measure of value and medium of exchange in the State, it is difficult to see how it satisfies the definition of “money” or “currency” for legal purposes. What is proposed …. appears to be a means of exchange that is treated as “money” purely in consequence of local custom and/or the consent of the parties. As such it does not represent or reflect an exercise of monetary sovereignty by the State and thus falls outside the legal definition of “money”. The answer to the first question is thus that Katz is not currency or money in the eyes of the law. As such its introduction is not subject to any prohibition implied by law.”

There’s only one minor problem with this – if my interpretation of the Opinion is correct, the State would not be able to accept quid in payment of its taxes without the quid legally becoming money and this would be in breach of the EU Directive making the euro the single currency. Making the quid money might also affect the basis on which electronic purses could be used by networks. In the past, the EU has insisted that they may only contain euros, or units with a value expressed in euros, whereas we want the quid to be able to float in value relative to the euro. However, these are very much problems for another day, some years in the future.

This should not affect a council accepting quid because a council is not the state itself and would not need to pass a law to enable it to handle quid. I think problems would only arise if central government accepted quid in payment of income tax and VAT as this would require legislation. Such legislation would give the quid “the formal and mandatory backing of the domestic legal system in the State or area in which it circulates” to quote Collins’ authority. This would make the quid money. Whereas “anything which is treated as “money” purely in consequence of local custom or the consent of the parties does not represent or reflect an exercise of monetary sovereignty by the State concerned, and thus cannot be considered as “money” in a legal sense.” would apply to the arrangements made with the local council. So the issue is not the state accepting quid at par (or any other value) with the euro but accepting quid at all if legislation is required for it to do so.

The second question was whether quid were “governed by Directive 2000/46/EC of the European Parliament and of the Council of 18 September 2000 on the taking up, pursuit of and prudential supervision of the business of electronic money institutions, such that the system must comply with the requirements set out therein.” After some analysis, the answer was no, in part because the unit was not money. Obtaining this opinion is a relief because had the answer been otherwise, the compliance costs would have been high.

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Liquidity Network at Transition Towns Tralee

Tralee Transition Towns held an evening on local currencies on 25th November and Phoebe Bright made a brief contribution on the Liquidity Network. There were a steam of good questions from this large and active group. We hope to return to Tralee soon!

Other presentations included an overview of money systems from Steve Allin (hemp guru), local Credit Union, whose loans are down but whose savings rate has doubled in the last 6 months. A happy customer of the Triodos bank, based in the UK but with a few Irish customers. The local LETS group who are restarting after a gap for the Celtic Tiger

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Brochure and FAQs for the Liquidity Network now available

We now have a simple 1 page brochure to give a brief overview of what the Liquidity Network is, how it works and the potential benefits to a local economy.

The Brochure can be downloaded in .pdf format here:

Please share widely!

We have also been working on a set of questions to follow on from the brochure.  If you can’t find the answer to your questions, do add questions at the end of the list and we will get you an answer as soon as we can.  See FAQs on this website.

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Work with Kilkenny proceeding

A group from the theliquiditynetwork.org team is currently making concrete proposals for the implementation of such a system with the Kilkenny local council in Ireland. The presentation already offer concise insights on the procedures. The ideas evolve around simple yet powerful and secure electronic means of payments, building on a lean system to get quickly started and which would be expanded over time.

These are the main criteria for the system:

  • Low barriers to entry for B2B, B2C and C2C
  • Cater for range of technical comfort levels
  • At least as secure as chip and pin credit card
  • Quick to develop trial
  • Extensible and open
  • Use standard, easily available components
  • Plenty of marketing oportunity
  • Innovative and news-worthy
  • Low risk system
  • Focus on user experience and trust

The system components have been so far identified as the following:

  • A lightweight, scalable server to run the LQN accounts
  • A simple web based client that can run on anything from a
    mobile phone, through an iPod touch to a laptop.
  • Scalable security / ease of use trade-off depending on
    levels of trust
  • Extensions for vouchers and cheques as ‘delayed electronic
    transactions’
  • A system that is as anonymous and secure as a credit card
  • As easy as using a phone

Usage of the system is proposed on the following assumptions:

  • We sign up users by giving them a card containing their
    account number and verification number (optionally
    increase security using photo)
  • We forward a PIN to them in a secure manner (not email)
  • We could ask some users (high volume such as retailers) to
    upload photographic evidence (buildings or faces)
  • Users and customers use simple web interfaces where they
    must input some of account numbers, PINs and
    amounts. All these are digits to enable simple mobile
    phones.
  • Retailers choose their input device – we will recommend
    touch-screen smart-phones / PDAs but they can use what
    they like. For QR codes we would recommend 3 types of
    smartphone.

We also plan to introduce self-printed vouchers as physical currency:

  • Use once
  • Change credited automatically to printer’s account
  • Scanning takes trader to

    https://lqn.ie/katz/voucher?id=4829NSLF92

  • Could be printed for users at Kilkenny Katz help-desk

This summarizes the proposals presented to Kilkenny people, both from the public and the council. Discussions are going on to decide on further steps.

Feel free to contact us for more information.

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Paper and electronic quids

There is a highly interesting discussion unfolding at the feasta.org website. It deals with the discussion about paper currency and virtual tokens.

Initially, the LQN had been proposed as an electronic system only. Such a system allows different tweaking, as there is the chance to adjust the currency supply to the economic activity level.

After the auspicious meetings with both the Kilkenny Council and the Kilkenny public, the wish for the introduction of a paper version of the quids has been postulated. The main driver for this being an increased identification and acceptance through tangible units, as well as broader integration of potential members with no interest or reluctance to adopt electronic devices.

The project team has taken up this new proposal very seriously, as it recognizes the validity of its advantages. Several issues need to be addressed, like the costs of production, introduction and distribution/removal, forgery, as well as coexistence issues with the electronic version of the quids.

There is an interesting discussion thread at the feasta website which deals with this subject. You can follow it here.

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