In the “Ecology of Currencies | Kuneco April 2021” panel discussion, experts in the field of blockchain and finance discussed the topic of ecology of currencies, including the design, incentives, and tools involved. This tutorial provides a summary of the key points discussed in the panel.
Currencies, in any form, serve three main functions: medium of exchange, unit of account, and store of value. Bitcoin, for example, is a great reserve asset but may not be ideal for day-to-day transactions due to its volatility. Stablecoins like the Celo Dollar provide stability and are suitable for daily transactions.
Celo is a blockchain platform that supports different currencies, including stablecoins and fiat currencies. The Celo Euro, for example, enables 50 million micro-workers in Europe to send value home to their families. Celo aims to make different currencies available to users worldwide, providing fast and easy transactions through mobile phones.
Resource is an organization focused on financial inclusion using blockchain technology. They aim to provide banking services to unbanked individuals in Africa. Their app, DuniaPay, allows users to save, spend, and transfer money to any phone number. They plan to launch a stablecoin that is directly exchangeable for Celo Euro, providing convenience and accessibility to their users.
Curve Labs, based in Berlin, is an innovation lab focused on token engineering and decentralized governance. They are interested in Celo due to its stability mechanism and democratic governance. They aim to create effective institutions that combine traditional institutional forms with new social choice mechanisms.
Local currency movements, such as barter systems and alternative currencies, have existed for a long time. Blockchain technology can systematize and connect these movements, providing new opportunities for social innovation. Platforms like Celo are developing tools to support local currency movements and create interoperability among different tokens.
Curacao is working on creating a local currency that goes beyond a simple medium of exchange. They are exploring the use of reserve assets as collateral to mint a medium of exchange currency. For example, they tokenized a food forest as an NFT and used it as collateral in farming contracts and insurance policies. This approach expands the concept of local currencies and offers a wider range of possibilities.
Each project discussed in the panel has different applications and target users. DuniaPay focuses on serving unbanked individuals in Africa, while Resource targets small and medium-sized businesses. They drive awareness through partnerships with merchants, allowing them to advertise their services directly to clients. They are also exploring collaborations with other entrepreneurs to create stablecoins denominated in different currencies.
The panel emphasized the importance of building an ecology of currencies that is inclusive, interoperable, and socially responsible. Through blockchain technology and platforms like Celo, it is possible to connect local currency movements, provide financial services to underserved communities, and explore innovative applications of cryptocurrencies.