We have decided to create for this event what we named a “Shadow currency”. A few details about this newcomer in the crypto universe, which will be back in 2018:
– It is called the “Lip” (1 Lip, 2 Lips)
– It is indexed on euros (1 Lip = 1 Euro. No speculation permitted).
– It was implemented using the Ripple Blockchain.
– At all the Festival’s locations, all transactions were be recorded on a Blockchain based ledger, allowing each one (partners, festival goers, etc.) to check the direction their lips were taking. Thereby, it also provided a real time accounting for the festival.
Now, let’s answer one of the questions we heard the most during SeaNaps: Why not using Bitcoin or Ether?
1) Because Ether and Bitcoin might be doing great in many contexts, but are not suitable for a festival. For instance:
– Opening and funding an ETH or BTC wallet with Euros is too complex and intrusive for just attending a festival. One needs 2 days with a platform like Kraken and needs to provide sensible information (id information, selfie with id card, proof of residence). We simply could not propose this to persons who just want the piece of pizza they see on the counter to end up in their stomach within 30 seconds.
– Native currencies Ether or Bitcoin are too volatile with respect to Euro for our situation. We didn’t want to take any risk in the payment of our artists, nor to scare some non tech-savvy festival-goers. Moreover, SeaNaps being responsible for paying the “gas” on each transaction, 2017’s market evolution made it quickly prohibitive.
– Average number of transactions / seconds was too low on these two blockchains (4 txs/s for Bitcoin, 20 txs/s for Ethereum). A gastronomy selling situation demands for a quick update of information (in order to show every festival-goer his/her wallet balance after a purchase). Ripple and their 1000 tx/s were more suitable for this context.
2) Because as any experiment, ours needed to have a date of start and a date of end, and creating a token for the four days of the festival only made it accurately observable.
3) Because the fact of creating a currency that is both taking a local (mainly concerning physical and local interactions at first and questioning the way the local economy can be invested by its inhabitants) and a worldwide perspective (using the nation-less and decentralized aspects of the blockchain) is making it twice more interesting.
4) Because the neutrality of our token also allowed it to stay out of parish strife such as the one opposing Bitcoin to Ether. In the same approach, we are also opening the door to any blockchain community wanting to try implementing their model to this particular problem. During the next editions, our data will still be public, and can be implemented on various blockchains on parallel. The research’s outcomes would benefit from this opening of perspectives and methods.
5) Eventually, because we wanted to experiment the compatibility between blockchain solutions and local complementary currencies. We therefore took a similar approach to those.
This brings to another question: what is a local complementary currency, and what does it have to do with the blockchain?
A local complementary economy (LCE) has for first principle and virtue to keep the value within the ecosystem in which it got created in the first place, preventing it from escaping in globalised banking channels. The first interest of a local complementary currency (LCC) is to be exclusively tradable within a circuit from which the actors acknowledge each other. Such local producer, such selling point, such consumer. They all take a risk by accepting to participate in this game. But this risk is getting lower as the number of participants increases. We can say that it is distributed. Moreover, the benefits are being reinvested in goods benefiting, if not to all directly, at least in a common ideal. Local complementary economies hence make the choice of a long term growth. Schools, culture(s), infrastructures… The harvested fruits reflect the commitment and values of its users. They also fit to their material or immaterial needs.
In this sense, LCEs are potentially a wonderful instrument of self managed participative democracy. Instead of expecting a better transparency and decentralization in public policies decision-making processes, leaving to the management of the many only a small part of local budgets.
SeaNaps has hence used the blockchain on a “classical model” of LCE:
Each purchase done within the SeaNaps ecosystem was thought and distributed by and through its actors, adding to the individual gains a notion of common good and local development. As for LCCs, the value transmission was played outside of the traditional banking system. This allows to develop the intuition of a compatibility between LCEs as a model of wealth creation and the blockchain as an instrument for its redistribution.