Socio-Economic Inclusion
Community Currencies Interoperability
Description
While communities that have tackled the path towards their own currency issuance, which might tend to isolate themselves from external economies, local and social economies need interoperability with external economies to be able to grow up and generate wealth in a sustainable way.
Community Currencies (CC) are valuable because they are used and accepted within a limited set of accounts. Therefore, they are tradable for good & services that people can find internally. As CCs are not valuable in the external economy, these can’t be used to trade against goods & services that are not offered from within the community.
One solution that offers the needed interchangeability is to bond community issued credit (or just CC) to a collateral co-owned by the Collective, and stored on a smart contract that will then serve as an automated market maker (AMM). This would guarantee liquidity availability among the local (e.g. CC) and external (e.g. USD, RIFdollar) currencies.
The following is an example from Bancor’s bonding curve:
This way, the price of the CC to be traded against the reserve (e.g. in RIFdollars) will be always a function of the total supply of CCs and the amount in reserves. Setting a target supply where the price of a CC will be equal to 1 unit of its reserve would place incentives, while socially agreeing that goods and services to be traded against CC at such a valuation (e.g. 1 CC = 1 RIFdollar) would set arbitrage incentives to keep the bonding curve price around 1. This way, individuals would be able to enter and exit between the external and the local economy with a proper stability.
Guidelines
The challenge is to consider cases exposed in Community Currency Issuance , while building an application in which users can exchange their currencies among reserve tokens and community tokens
To consider/ emulate an ecosystem with multiple Community Currencies that are interoperable among each other
Building a tool that allows the exchange of community cryptocurrencies using bonding curves
Resources
The following are categorised resources which may be helpful as references while implementing your solutions.
General Resources
Technical Resources
Technical Standards
Community Currencies Interoperability
Description
While communities that have tackled the path towards their own currency issuance, which might tend to isolate themselves from external economies, local and social economies need interoperability with external economies to be able to grow up and generate wealth in a sustainable way.
Community Currencies (CC) are valuable because they are used and accepted within a limited set of accounts. Therefore, they are tradable for good & services that people can find internally. As CCs are not valuable in the external economy, these can’t be used to trade against goods & services that are not offered from within the community.
One solution that offers the needed interchangeability is to bond community issued credit (or just CC) to a collateral co-owned by the Collective, and stored on a smart contract that will then serve as an automated market maker (AMM). This would guarantee liquidity availability among the local (e.g. CC) and external (e.g. USD, RIFdollar) currencies.
The following is an example from Bancor’s bonding curve:
This way, the price of the CC to be traded against the reserve (e.g. in RIFdollars) will be always a function of the total supply of CCs and the amount in reserves. Setting a target supply where the price of a CC will be equal to 1 unit of its reserve would place incentives, while socially agreeing that goods and services to be traded against CC at such a valuation (e.g. 1 CC = 1 RIFdollar) would set arbitrage incentives to keep the bonding curve price around 1. This way, individuals would be able to enter and exit between the external and the local economy with a proper stability.
Guidelines
The challenge is to consider cases exposed in Community Currency Issuance , while building an application in which users can exchange their currencies among reserve tokens and community tokens
To consider/ emulate an ecosystem with multiple Community Currencies that are interoperable among each other
Building a tool that allows the exchange of community cryptocurrencies using bonding curves
Resources
The following are categorised resources which may be helpful as references while implementing your solutions.
General Resources
Technical Resources
Technical Standards
