Peer-To-Peer Bartering To Replace Money?

from the maybe-not... dept

Nicholas Negroponte was a huge supporter of electronic currencies, even as one after another failed. Now, he’s back, suggesting that the next version of “electronic currency” will simply make use of peer-to-peer technology to complete multi-party barter exchanges. Of course, the whole reason money was invented was to do away with the need for bater, since it’s tough to match up an even exchange in a barter system. Instead, you use cash as a more widely accepted proxy for a product that could be traded in a barter system. However, Negroponte thinks that the ease of money has nothing on… um… the complexities of a peer-to-peer barter system. Why? Maybe because it seems cool. Otherwise, it doesn’t seem to make that much sense. Admittedly, there are new forms of barter currency and things like freecycle catching on to help people give away (or get) stuff for free. However, is it really that much easier to have a P2P system find a limo driver who wants a fish you can provide, and a dentist who wants a limo ride, so that you can get your teeth cleaned in exchange for fish (the actual example Negroponte uses)? Isn’t it just easier, and much more efficient, to sell your fish in the open market and pay the dentist with your cash, while letting the limo driver fend for himself?

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Comments on “Peer-To-Peer Bartering To Replace Money?”

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Robin Upton (user link) says:

P2P Money

It won’t be P2P, it’ll be F2F (Friend2Friend), at least if the trading happens over a social network. Why bother with the complexity?… Because I like to know who I’m dealing with. If I pay cash, I can’t know the results of my transaction. My cheap goods are someone else’s low wage rates. Dealing directly with people helps me know the consequences of my actions, which helps me act responsibly.

Another big reason to avoid centralised money is to escape the control of the banking establishment. I like only to pay people for work done, not because they have secured political privilege, which is a problem, since the banking establishment currently holds a monopoly on credit, and charges interest on all the money in circulation.

Altruistic Economics, Open Money and other decentralised trading systems are coming fast and will offer some people an alternative to the command economy. Others will remain perfectly free to keep using cash if they feel that’s superior.

Omni Solomon (user link) says:

pirates and tax evasion

Just like the crack down on peer-to-peer file sharing, you bet your butt there’d be a strong crack down on peer-to-peer bartering.

Check out IRS topic 420..

In essence, u.s. tax code requires that all barter income be reported via form 1099b, and that it is taxable as regular income.

For a ‘black hat’ peer-to-peer barter network to come close to working, access would need to be via a Virtual Private Network operated by some trusted overseas company, to protect the identity of all who bartered.

Although it is centralized, you might be interested in the company I write code for. We facilitate direct trades, and also provide a barter currency. link: Barterfest

dave rankin says:

barter and personal money

money is the measurement of the exchange of value between people
Michael Linton 1982

barter in its simplest form is inefficient but
personal money as described by Linton is becoming the way of the future
many barter trading companies are charging outrageous percentages for their hosting services
this is so unnecessary
one company i found doesn’t even charge transaction fees like your bank might
they charge advertising fees for businesses
they handle all transactions processing and hosting for the income derived from the ads

personal money is on the rise
and for those who know the theory of multilets as developed by Michael Linton and Angus Soutar IS the way of future economic interaction

John Durrant (Favabank) (user link) says:

Money can be seen as a measurement of IOUs

All money that exists is debt, and the accepted currency tends to be whatever the state demands its tax payments in which gives money its value.

Unless Peer-to-peer forms of currency become acceptable as tax payments, they’ll never replace conventional money, but that’s not really their aim.

Large scale peer-to-peer trading between people, setting up chains of IOUs based on individual reputations, is certainly a conceivable outcome of the culture of trust networks inherent within social media. If they can offer convenience and qualities that real money can’t provide (e.g. abundance rather than scarcity), then perhaps they’ll catch on to be a complement to national currencies in the future. I making my own small attempt to create a peer-to-peer bartering network in the UK called Favabank. The future of money may well be different from the past.

dronesquad says:

Blockchain will revive barter once again

Barter 1.0 was very simple in the early days, limited by in-person interactions and primitive methods such as "dumb barter"which was a method by which traders who cannot speak each other’s language can trade without talking.

Barter 2.0 came with the internet, facilitating remote interactions, leading to a higher chance of success and stories such as one red paperclip.

Barter 3.0 seems to be in early stages of development and is made possible through distributed ledger technology, aka "blockchain" and its ability to electronically transfer value without an intermediary, using smart contracts. Here’s an interesting project that’s building the next generation of P2P barter with multilateral trading and collateralization.

It’ll be interesting to see whether barter 3.0 can really be viable alternative medium of exchange.

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