Introducing Cyclos - an Open Source complementary currency software

[Max Stirner]

I was often asking myself- if there is an economic breakdown, how can we install economic "life saving boats"? 
Then I found the open source Cyclos project - that was before I found Bitcoin though.

http://project.cyclos.org/


"Cyclos is open source online banking software for complementary currency systems like Barter networks and exchange systems as C3 (commerce and consumer circuit) that are introduced in order to stimulate the circulation and the availability of credit in regions or countries with under-use of capacities..."

As far as I know - you can also pay other cyclos members via SMS on your mobile phone.

So the cyclos platform has an internal currency that cannot leave the community - and vice versa - everyone who wants to participate in this local economy has to live close to the other members of the cyclos network. The reason why I prefer bitcoin over Cyclos is that I can start exchanging goods and services right away - I just have to use the mail service for example. If there is no imminent NEED for a local alternative economy to grow (like a lack of food or employment) the cyclos net will not grow.
This Cyclos platform can only work - in my opinion - when people offer goods that are directly useful to
everyone in the community- like growing food or selling tobacco. But the problem is, that the people most likely to join a cyclos platform aren't farmers. That is the reasion why I think bitcoin is a more succesfull approach for the moment.

Still, I wanted to share this link - maybe somebody gets inspired by this software or finds a way to integrate it with bitcoin.

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[Anonymous]

I wonder if you could replace the internal currency with bitcoins?

[Max Stirner]

Good question.

The next disadvantage of cyclos - it is not anonymous. And how do you get your
money out of the system? Someone in the Cyclos network could offer Bitcoins for the
internal money. That is a possibility.

But in the end the flexibility of bitcoin with its decentralized structure beats the cyclos
system.

[Anonymous]

Good question.

The next disadvantage of cyclos - it is not anonymous. And how do you get your
money out of the system? Someone in the Cyclos network could offer Bitcoins for the
internal money. That is a possibility.

But in the end the flexibility of bitcoin with its decentralized structure beats the cyclos
system.

True.It might offer a solution for a local exchange trading system using bitcoins though?

Say if I wanted to mow someones lawn and didnt want cash but this "favour" could then be used to purchase something in the local community or redeemed for bitcoins.A central record is the essential thing needed for a LETS type system.A hybrid beast could be created.

People might offer a t-bone steak for bitcoins from their local butcher or get some trash collected,house maintenance or babysitting without the need to ever use cash which would then benefit the local community you live in.

I found a LETS system that is operating close to my area and Im going to contact them to see if they would be interested in a co-operative arrangement.It could be the easiest way to incorporate/gain acceptance for bitcoin within a local community.

This is one system where you want to be known to your community rather than be anonymous imo.

[Max Stirner]

"A hybrid beast could be created."

That's right.

The whole idea of an functioning economy is to work productively - and that work is
increasingly productive with people working TOGETHER and specializing in certain jobs.
But that requires people living close to each other - at least when real goods and services
are to be exchanged. This is where the LETS system starts.
Bitcoin users on the other hand are not (yet) living close to each other and either have to exchange
virtual services or they need a postal service for exchanging real goods.
Combining LETS systems and and bitcoin is a great idea. Of course you could just create
a LETS systems running on bitcoins - but who is going to do the programming?


I think you already pointed it out, it is not even necessary to buy the LETS currency
with bitcoins - which is probably not possible anyway because the LETS currency is trapped
in the LETS system. You just join the LETS System and instead of mowing someones lawn you
offer bitcoins as a "service". The only thing you have to do, is to convice the people
who are running the LETS System that they let you do it.

Hey, I'll keep my fingers crossed.

[mizerydearia]

I found a LETS system that is operating close to my area and Im going to contact them to see if they would be interested in a co-operative arrangement.It could be the easiest way to incorporate/gain acceptance for bitcoin within a local community.

This is one system where you want to be known to your community rather than be anonymous imo.

It would be interesting to establish a kind of global set of procedures, guidelines, documentation in a kind of system that local communities could then use within their own confined areas to help establish usage of Bitcoin within localities.  Perhaps maybe a wiki page or a dedicated website could be set up to help establish this type of community of communities?

[Anonymous]

I found a LETS system that is operating close to my area and Im going to contact them to see if they would be interested in a co-operative arrangement.It could be the easiest way to incorporate/gain acceptance for bitcoin within a local community.

This is one system where you want to be known to your community rather than be anonymous imo.

It would be interesting to establish a kind of global set of procedures, guidelines, documentation in a kind of system that local communities could then use within their own confined areas to help establish usage of Bitcoin within localities.  Perhaps maybe a wiki page or a dedicated website could be set up to help establish this type of community of communities?

There is no need to reinvent the wheel - there are existing tools that are available within the LETS community which could be modified for bitcoins.

http://communityforge.net/how%20community%20online

[Anonymous]

"A hybrid beast could be created."

That's right.

The whole idea of an functioning economy is to work productively - and that work is
increasingly productive with people working TOGETHER and specializing in certain jobs.
But that requires people living close to each other - at least when real goods and services
are to be exchanged. This is where the LETS system starts.
Bitcoin users on the other hand are not (yet) living close to each other and either have to exchange
virtual services or they need a postal service for exchanging real goods.
Combining LETS systems and and bitcoin is a great idea. Of course you could just create
a LETS systems running on bitcoins - but who is going to do the programming?


I think you already pointed it out, it is not even necessary to buy the LETS currency
with bitcoins - which is probably not possible anyway because the LETS currency is trapped
in the LETS system. You just join the LETS System and instead of mowing someones lawn you
offer bitcoins as a "service". The only thing you have to do, is to convice the people
who are running the LETS System that they let you do it.

Hey, I'll keep my fingers crossed.

    Yeah I actually thought of how I could purchase bitcoins for use in the group.    You could even make up bitcoin iou's or cheques to hand over when you have a service performed for you.As it is a local community system people are less likely to rip you off as it risks their reputation.People are way less likely to crap in their own backyard.

[mizerydearia]

There is no need to reinvent the wheel - there are existing tools that are available within the LETS community which could be modified for bitcoins.

http://communityforge.net/how%20community%20online

Thanks for the reference!  I wasn't aware of that.

Member groups rent an instance of the software, which they can in principle configure and adapt to their needs.

However it appears there is a need to reinvent the wheel due to control over the underlying software/system as well as required reciprocal gifting.

Cforge is a Drupal application which uses around 30 publically contributed 'modules' + one private 'glue' module.

I am familiar/semi-skilled with Drupal and can implement an equivalent and offer using open source, however, I am also not sure that using Drupal is best environment to implement for.

Additionally, to use Community Forge in a kind of Bitcoin established LETS system that is to be used by local communities as their own system, seems like it could establish into a lot of work unnecessary or potentially costly work for Community Forge.  This is so because the Community Forge system is a service offered instead of a product (software) offered to let the community handle the service for themselves.

The only comparable service to our is Community Exchange Systems (CES) based in South Africa.

Perhaps a third competitor, but primarily based on implementing functionality with Bitcoin, and one that is released/distributed as open source would be worthy?  If anyone is interested in establishing this idea, perhaps I can help to create/establish a community to develop this under.  Any ideas for a name?

-

I just noticed http://en.wikipedia.org/wiki/Local_Exchange_Trading_Systems and I see that there are more than two competitors, and Cyclos is one too.

[Anonymous]

There is no need to reinvent the wheel - there are existing tools that are available within the LETS community which could be modified for bitcoins.

http://communityforge.net/how%20community%20online

Thanks for the reference!  I wasn't aware of that.

Member groups rent an instance of the software, which they can in principle configure and adapt to their needs.

However it appears there is a need to reinvent the wheel due to control over the underlying software/system as well as required reciprocal gifting.

Cforge is a Drupal application which uses around 30 publically contributed 'modules' + one private 'glue' module.

I am familiar/semi-skilled with Drupal and can implement an equivalent and offer using open source, however, I am also not sure that using Drupal is best environment to implement for.

Additionally, to use Community Forge in a kind of Bitcoin established LETS system that is to be used by local communities as their own system, seems like it could establish into a lot of work unnecessary or potentially costly work for Community Forge.  This is so because the Community Forge system is a service offered instead of a product (software) offered to let the community handle the service for themselves.

The only comparable service to our is Community Exchange Systems (CES) based in South Africa.

Perhaps a third competitor, but primarily based on implementing functionality with Bitcoin, and one that is released/distributed as open source would be worthy?  If anyone is interested in establishing this idea, perhaps I can help to create/establish a community to develop this under.  Any ideas for a name?

-

I just noticed http://en.wikipedia.org/wiki/Local_Exchange_Trading_Systems and I see that there are more than two competitors, and Cyclos is one too.

The obvious name is BETS.  Bitcoin Exchange Trading System?

[mizerydearia]

mm, BETS seems interesting

Maybe Satoshi could sponsor such an establishment by offering use of http://bets.bitcoin.org?

Satoshi : Any comments on this idea?

[chaord]

I think that BETS, or something similar is a great idea!  I would be interested in getting involved in a BETS project.  However, since LETS type systems are mutual credit based, and bitcoin is closer to a commodity, I think the best of both worlds would be a Mutual Credit Clearing Network.  By this, I mean that goods and services are exchanged in the BETS system on credit (denominated in bitcoins of course), and each account is periodically settled in bitcoins.  This essentially means that each BETS account is a margin account.  Parties can then decide whether to transact with one another (or at what price) based on the counter party's history of maintaining their margin.

For any given time-frame in a LETS system there will be some accounts with trade surpluses and some accounts with trade deficits.  Most LETS/GETS type systems focus much of their time and effort in determining "how much maximum credit" to grant it's individual account holders so as to keep the system stable.  However, I think that the history of markets has shown that a more incremental solution is better.  I have not checked the facts on this, but I have never heard of a clearing house going bankrupt.  But even if there are a few examples in history of clearinghouses failing, I think the list is quite a bit shorter than LETS systems and local currencies going belly up .

[Anonymous]

    I was reading this article which describes how such a system would work http://www.realitysandwich.com/evolving_toward_local_credits

    Bitcoins are certainly "outside the banking system".Basically it would start with "trusted issuers" and allow lines of credit and so forth through "overdraft privileges".This would help manage cash flow for a small business as they wouldnt have to go outside their community and beg for credit from a bank.It would also provide working capital which is often starved from small or micro business. I think "Kiva" performs this service where it matches donators up with microbusinesses in the third world and allows poor people to access loans to start a business.

    On further investigation I found the author of that book Thomas H. Greco at http://www.reinventingmoney.com/documents/bio.html who is an expert on  complementary community currencies. I sent him an email letting him know about bitcoin and this thread to check out. If he is interested I hope he might give some input.

[Anonymous]

I think that BETS, or something similar is a great idea!  I would be interested in getting involved in a BETS project.  However, since LETS type systems are mutual credit based, and bitcoin is closer to a commodity, I think the best of both worlds would be a Mutual Credit Clearing Network.  By this, I mean that goods and services are exchanged in the BETS system on credit (denominated in bitcoins of course), and each account is periodically settled in bitcoins.  This essentially means that each BETS account is a margin account.  Parties can then decide whether to transact with one another (or at what price) based on the counter party's history of maintaining their margin.

For any given time-frame in a LETS system there will be some accounts with trade surpluses and some accounts with trade deficits.  Most LETS/GETS type systems focus much of their time and effort in determining "how much maximum credit" to grant it's individual account holders so as to keep the system stable.  However, I think that the history of markets has shown that a more incremental solution is better.  I have not checked the facts on this, but I have never heard of a clearing house going bankrupt.  But even if there are a few examples in history of clearinghouses failing, I think the list is quite a bit shorter than LETS systems and local currencies going belly up .

This is the drupal module that cforge uses.
http://drupal.org/project/mutual_credit  

I quite like the look of this software also
http://www.hughbarnard.org/content/alternative-currency-software

# Multilingual ready via HTML templating Simple::Template
# Support for payment via SMS, Encrypted email and Jabber
# Simple services directory
# Experimental rss feeds for trade items, offered, wanted, matched search

I especially like the sms and encrypted email bit  

[chaord]

    I was reading this article which describes how such a system would work http://www.realitysandwich.com/evolving_toward_local_credits

    Bitcoins are certainly "outside the banking system".Basically it would start with "trusted issuers" and allow lines of credit and so forth through "overdraft privileges".This would help manage cash flow for a small business as they wouldnt have to go outside their community and beg for credit from a bank.It would also provide working capital which is often starved from small or micro business. I think "Kiva" performs this service where it matches donators up with microbusinesses in the third world and allows poor people to access loans to start a business.

    On further investigation I found the author of that book Thomas H. Greco at http://www.reinventingmoney.com/documents/bio.html who is an expert on  complementary community currencies. I sent him an email letting him know about bitcoin and this thread to check out. If he is interested I hope he might give some input.

Pretty interesting stuff.  I'm actually familiar with Greco and his research.  He definitely has done quite a bit with regard to alternative currencies.  I'm curious what his ideal relationship between bitcoin and a local currency system would be.

[Anonymous]

    I was reading this article which describes how such a system would work http://www.realitysandwich.com/evolving_toward_local_credits

    Bitcoins are certainly "outside the banking system".Basically it would start with "trusted issuers" and allow lines of credit and so forth through "overdraft privileges".This would help manage cash flow for a small business as they wouldnt have to go outside their community and beg for credit from a bank.It would also provide working capital which is often starved from small or micro business. I think "Kiva" performs this service where it matches donators up with microbusinesses in the third world and allows poor people to access loans to start a business.

    On further investigation I found the author of that book Thomas H. Greco at http://www.reinventingmoney.com/documents/bio.html who is an expert on  complementary community currencies. I sent him an email letting him know about bitcoin and this thread to check out. If he is interested I hope he might give some input.

Pretty interesting stuff.  I'm actually familiar with Greco and his research.  He definitely has done quite a bit with regard to alternative currencies.  I'm curious what his ideal relationship between bitcoin and a local currency system would be.

He replied to my email with this.

I may be missing something, but I see no real need for it.
Mutual credit clearing is perfectly suited to mediate the exchange process without interest or inflation; it is well established and needs only to be optimized and taken to scale.

[mizerydearia]

http://www.alternativesmagazine.com/53/noyes.html

What is Mutual Credit Clearing?
Mutual credit clearing is a measurement of account for direct seller and buyer relationships. It’s used to track the exchange of money or trade credits—whatever your medium. Your banks use it. So do trade exchanges. Trade exchanges have brokers, and brokers determine how to allocate credit to facilitate transactions amongst members. Unlike barter, trade exchange participants may trade with anyone in the network. The bookkeeping system has two types of balances: 1) positive, i.e. credit for the seller; 2) negative, i.e. the buyer’s account is debited.

For the past forty years, trade exchanges have proved to be a useful complimentary (not replacement) system of exchange. It can be local or regional, and it can network with other exchanges across the continent. Today, there are over 500 exchanges nationwide helping business members increase sales, conserve cash, turn unproductive assets into valuable products and services, and reduce unit costs. As a result, trade exchanges now partake in an international, $650 Billion dollar industry.

I found the author of that book Thomas H. Greco at http://www.reinventingmoney.com/documents/bio.html who is an expert on  complementary community currencies. I sent him an email letting him know about bitcoin and this thread to check out. If he is interested I hope he might give some input.

He replied to my email with this.

I may be missing something, but I see no real need for it.  Mutual credit clearing is perfectly suited to mediate the exchange process without interest or inflation; it is well established and needs only to be optimized and taken to scale.

Is that his expert advice?  O_O  What a pity...  Perhaps we should presume that his advice truly is "expert" and cease Bitcoin establishments and focus on uhm, "mutual credit clearing."

Although, he is ~74 years old.  Perhaps he can elaborate on his perspective just a tad more.  Maybe he will blog about it?  Maybe we, as inidividuals comprising part of the community need to actively discuss more with him?  Perhaps someone can help us to establish a kind of interview or irc-based discussion panel or something?  That would be AWESOME!  If that would be a  possibility, perhaps we could gather up some topics for discussion and that may help to establish a better perspective as to how Bitcoin could be useful and THEN he may blog about it and perhaps it could help awareness?


http://www.theecologist.org/reviews/books/328601/the_end_of_money_and_the_future_of_civilization.html

What then is the solution or solutions? Greco proposes a variety of solutions from a complete web-based trading system to creating local, community- based exchange systems which can be linked to regional, national and international networks. Examples of the ‘banjar' system in Bali, Indonesia and the Mondragon cooperatives in northern Spain shows a workable community based exchange system.

If he proposes one solution as a web-based trading system and Bitcoin offers opportunity to establish a web based trading system (e.g. Mt. Gox, Bidding Pond) and there is plenty opportunity for anyone else to contribute even more web-based resources for exchanging/trading systems, then why does he also respond with "I may be missing something, but I see no real need for it?"  He must clearly be missing something if he responds with such contrasting views.

[Anonymous]

I was going to offer to buy his book using bitcoins 

To be honest I have encountered this resistance almost everywhere Ive mentioned it. Most of the time it takes a second look before people understand bitcoin. The brainwashing of the current way of doing things is extremely hard to break through, even amongst libertarian minded individuals. Reaching out to other communities is still worthwhile but most of the groundwork will have to come from the existing userbase.

I dont know if bitcoin is the answer or some other digital currency. Maybe an alternative currency "chamber of commerce" could be built that comes up with standards for the industry ? Historically standards come from the industry itself but it gets disheartening when no one wants to collaborate. There does seem to be a lot of siloing happening where each project thinks it is the only answer to the problem!

[mizerydearia]

Maybe an alternative currency "chamber of commerce" could be built that comes up with standards for the industry ?

"The industry"  -- As word spreads "the industry" or the individuals that comprise of one or more of such industries will offer their skill, expertise, talents to provide Bitcoin-related works, however, more research and development is needed.

More leadership roles within the Bitcoin community are necessary to organize, produce and to make things happen.

[chaord]

He replied to my email with this.

I may be missing something, but I see no real need for it.
Mutual credit clearing is perfectly suited to mediate the exchange process without interest or inflation; it is well established and needs only to be optimized and taken to scale.

Ha, what a joke! I kinda figured he would say something like that. He, along with most of the "mutual credit clearing" folks, in my opinion are just fiat advocates in disguise.  They essentially think that scarcity is not a required property for a medium of exchange.  The one thing I do give them credit for, pun intended, is that they are at least usually all for decentralization.  Beyond that, however, the reality of their economics seems pretty screwed up.