I would add also "4. Mutual Risk", as described by Matthew in his blog. If user A fails to fulfill their commitment, then the risk is equally distributed to everyone else (pure mutual credit) or only to those having user A's vouchers (commitment pooling). Technically, this is the innovative approach which could help mutual credit systems to scale: buying someone else's voucher is also a way to endorse their reliability/trustworthiness. I guess, this is the main difference from a "pure mutual credit" system. I'd be curious to know if you thought about others.
What is the commitment in a 'pure' mutual credit. ... Is it....that someone in a group might redeem my positive credit to extinguish their negative balance ...?
Is it pure because it is in some ways devoid of clear obligations?
Note that if you make a generic pool token that is only redeemable for things in the pool and holds no commitment of its own, then the risk of the pool holding bad commitments can fester to the point where the pool token is an empty vessel. ... derivative credit systems are more and more vulnerable to this and I think tend to call apart for this reason.
On the contrary a pool with no derivatives and audited by pool stewards seems like a much more rhobust.
Also note that in some use cases of such pools, one never needs to hold other people's toke for longer than making a payment.
I.e. I swap a Will to pull out a Teo inorder to pay you. I never need to hold other people's vouchers unless I have no credit in a pool.
Sorry, my use of 'pure' was misleading. I wanted to refer to some 'ideal' mutual credit system. In fact, in an 'ideal' mutual credit system there should be also similar elements to a voucher system.
In an 'ideal' mutual credit system:
1. Members join and decide a trading period, which is equal for everyone. For example, one year is the temporal limit within which all the businesses need to set their balance back to zero. This trading period is fixed, while in a voucher system is flexible (every user can decide an expiration date for their voucher).
2. Members 'pool' their commitments by choosing 'what' and 'how much' they can offer, but that rule becomes the standard equal for everyone. In LETSs, this is usually done through a group assessment which 'averages'/estimates the productive capacity of the members and chooses a debt limit equal for everyone. In business networks, this is usually made by 'averaging'/estimating the productive capacity of the business from previous years. In a voucher system, every user decides 'what' and 'how much' to commit.
3. A form of Stewardship is also present in an 'ideal' mutual credit systems. It is often just the group meeting regularly to manage internal issues. In fact, a mutual credit group is usually a closed group which in principle opens and closes only at the end of trading periods. In a more flexible set up, the Stewardship has the formal and legal responsibility on accepting new members. In this sense, the 'openness' of a voucher system is the main difference. A voucher system is open to a new member through peer-to-peer assessment, instead of group assessment.
Sorry, I took too much space. I was very thrilled by reading this post, I liked this exercise of comparing models!
Yes that sounds great. We need to recruit the members first; the Cherokee have three massacres in mind to memorialize and ask repair for, if that’s how i should say it, and we have African American communities here we are already working with who are doing repair and who will be on the catacap.org platform
The coop investment committee of the system entrepreneurs we’d be granting could be the stewards. The common cents fund would create the zero interest patient philanthropic loans, administered by the system entrepreneurs so they are not only grant supported.
That sounds perfect. In case you wanna beta test on the website before we get an app working: Sarafu.Network Beta Test Instructions for voucher and pools:
Ensure you have the latest google Chrome
1🦮Goto sarafu.network and connect your wallet (Valora, MetaMask ... )
2🦮Click apply for a social account (this auto-tops up your gas)
3🦮On the Voucher Menu - create a Voucher. GO through all the steps and lemme know any issue/corrections. You will in the end have to sign 3 times.
4🦮Try to send me some of those voucher to my alias ge@ge
5🦮On the Pool menu - create a Pool. Fill it in and click create - you will have to wait for a long time - but it will eventually say success.
6🦮Once the Pool has been created you can Add a Voucher there - add the one you created, give it an exchange rate (1) is ok then a limit (100) example. You will need to sign 3 times
7🦮Go back to the Pool and add another Voucher, choose cUSD and give it a similar limit and rate of 0.92 (exchange rate to usd from eur). (sign 3x)
8🦮Go back to the Pool and Deposit/Seed some of your vouchers into the pool.
9🦮Then lemme know and I'll try to swap some cUSD in there for your vouchers.
I would add also "4. Mutual Risk", as described by Matthew in his blog. If user A fails to fulfill their commitment, then the risk is equally distributed to everyone else (pure mutual credit) or only to those having user A's vouchers (commitment pooling). Technically, this is the innovative approach which could help mutual credit systems to scale: buying someone else's voucher is also a way to endorse their reliability/trustworthiness. I guess, this is the main difference from a "pure mutual credit" system. I'd be curious to know if you thought about others.
What is the commitment in a 'pure' mutual credit. ... Is it....that someone in a group might redeem my positive credit to extinguish their negative balance ...?
Is it pure because it is in some ways devoid of clear obligations?
Note that if you make a generic pool token that is only redeemable for things in the pool and holds no commitment of its own, then the risk of the pool holding bad commitments can fester to the point where the pool token is an empty vessel. ... derivative credit systems are more and more vulnerable to this and I think tend to call apart for this reason.
On the contrary a pool with no derivatives and audited by pool stewards seems like a much more rhobust.
Also note that in some use cases of such pools, one never needs to hold other people's toke for longer than making a payment.
I.e. I swap a Will to pull out a Teo inorder to pay you. I never need to hold other people's vouchers unless I have no credit in a pool.
Sorry, my use of 'pure' was misleading. I wanted to refer to some 'ideal' mutual credit system. In fact, in an 'ideal' mutual credit system there should be also similar elements to a voucher system.
In an 'ideal' mutual credit system:
1. Members join and decide a trading period, which is equal for everyone. For example, one year is the temporal limit within which all the businesses need to set their balance back to zero. This trading period is fixed, while in a voucher system is flexible (every user can decide an expiration date for their voucher).
2. Members 'pool' their commitments by choosing 'what' and 'how much' they can offer, but that rule becomes the standard equal for everyone. In LETSs, this is usually done through a group assessment which 'averages'/estimates the productive capacity of the members and chooses a debt limit equal for everyone. In business networks, this is usually made by 'averaging'/estimating the productive capacity of the business from previous years. In a voucher system, every user decides 'what' and 'how much' to commit.
3. A form of Stewardship is also present in an 'ideal' mutual credit systems. It is often just the group meeting regularly to manage internal issues. In fact, a mutual credit group is usually a closed group which in principle opens and closes only at the end of trading periods. In a more flexible set up, the Stewardship has the formal and legal responsibility on accepting new members. In this sense, the 'openness' of a voucher system is the main difference. A voucher system is open to a new member through peer-to-peer assessment, instead of group assessment.
Sorry, I took too much space. I was very thrilled by reading this post, I liked this exercise of comparing models!
I will wait until my more tech literate colleague is back from bereavement leave.
Yes that sounds great. We need to recruit the members first; the Cherokee have three massacres in mind to memorialize and ask repair for, if that’s how i should say it, and we have African American communities here we are already working with who are doing repair and who will be on the catacap.org platform
The coop investment committee of the system entrepreneurs we’d be granting could be the stewards. The common cents fund would create the zero interest patient philanthropic loans, administered by the system entrepreneurs so they are not only grant supported.
That sounds perfect. In case you wanna beta test on the website before we get an app working: Sarafu.Network Beta Test Instructions for voucher and pools:
Ensure you have the latest google Chrome
1🦮Goto sarafu.network and connect your wallet (Valora, MetaMask ... )
2🦮Click apply for a social account (this auto-tops up your gas)
3🦮On the Voucher Menu - create a Voucher. GO through all the steps and lemme know any issue/corrections. You will in the end have to sign 3 times.
4🦮Try to send me some of those voucher to my alias ge@ge
5🦮On the Pool menu - create a Pool. Fill it in and click create - you will have to wait for a long time - but it will eventually say success.
6🦮Once the Pool has been created you can Add a Voucher there - add the one you created, give it an exchange rate (1) is ok then a limit (100) example. You will need to sign 3 times
7🦮Go back to the Pool and add another Voucher, choose cUSD and give it a similar limit and rate of 0.92 (exchange rate to usd from eur). (sign 3x)
8🦮Go back to the Pool and Deposit/Seed some of your vouchers into the pool.
9🦮Then lemme know and I'll try to swap some cUSD in there for your vouchers.