Metabolic Currency: The future of money and sustainable growth

Introduction

Do you know how money is created?It’s okay. Most people don’t. Very few understand how money creation really works. We may have learned in school that the US Treasury prints money and that’s it. The amount of money printed is only a small fraction of the money in circulation. The true story of money is much bigger and more complex.

History of the Metabolic Currency as a Concept

R. Buckminster Fuller was the first person to publicly propose the idea of a metabolic currency based on electricity, the Global Energy Grid, in 1969. Fuller stated: “Because energy is wealth, the integrating world industrial networks promise ultimate access of all humanity everywhere to the total operative commonwealth of earth.”[1] In response to an 11-year-old who asked Buckminster Fuller a question about how to solve for violence in the world, Fuller replied:

Debt and Interest: The System Flaw

Money is simply an agreement or contract that acts as a medium of exchange. In the US, money has held value only in how much trust we put into the agreement. The US dollar only holds value as long as global economies have faith in the ability of US taxpayers to repay treasury bonds with interest. At some point, this system will crash when people, businesses, and institutions stop being able to repay debts. We have seen this happen in a few countries — where debt became too burdensome and the currency failed. This happened in Argentina, Brazil, and Ecuador to name a few. It’s a mathematical inevitability. It’s not a matter of if, but when. In distinct contrast to debt, energy holds inherent value. This debt-based model is not workable for the long-term and we are seeing failures in our environment and economies.

Earth’s Metabolic Rate is the Sustainable Rate of Growth

Earth is a thermodynamic system, with one singular energy input — the Sun. All living things (including humans and all human activities) are governed by a simple set of thermodynamic rules. Nothing, not even economics, is separate from nature or the rules of physics. Even if digital models or short-term market behavior give the temporary illusion that we can defy those rules, ultimately energy drives the economy and the laws of physics will catch up with us. The true basis of all economic activity is energy, harvested directly (solar energy), indirectly (via plants and animals), or from the past (fossil fuel).

How to Build Metabolic Currencies

It could be argued that some commodities as well as carbon credits or renewable energy credits already are metabolic currencies. However, at the moment none of these are easy to trade by average consumers. They aren’t used as a medium for exchange, but rather as a store of value. However, with a little tweak, commodities could be the backing for metabolic currencies.

Energy-derived Blockchain Cryptocurrencies

There are a few early tests of using blockchain technology for metabolic currency. While these currencies are derived from energy, they aren’t true metabolic currencies, in that they aren’t redeemable for the representative unit of energy value. You can’t trade a Solarcoin for a kWh of electricity with your local utility. Other energy-based cryptocurrencies include Solarcoin, kwh coin, joulecoin, power and microsoft’s blockchain currency mined by human body heat and brainpower.

Energy-backed Currency is the Future of Money

Already, cryptocurrencies are being touted as the future of energy. But the instability of these currencies poses a big problem, not to mention the energy consumption associated with mining. It’s only a matter of time until utilities wake up to realize that there is a tremendous value and potential in recognizing that blockchain energy contracts can be traded as a currency. Energy-backed currency can be the future of money.

  1. Brenneman, Richard. Fuller’s Earth, 1983.
  2. McConnell, The Joule Standard. Resilience.org. 2013. https://www.resilience.org/stories/2013-02-06/the-joule-standard/
  3. “Was the Whole World a Ponzi Scheme?” https://www.nytimes.com/2009/01/01/business/worldbusiness/01iht-col02.1.19024758.html
  4. Navigant Research. 2014. Retrieved July 26, 2018. https://www.navigantresearch.com/newsroom/prepaid-electric-meters-are-expected-to-have-an-installed-base-of-more-than-85-million-from-2014-to-2024
  5. Navigant Research. 2014. Retrieved July 26, 2018. https://www.navigantresearch.com/newsroom/prepaid-electric-meters-are-expected-to-have-an-installed-base-of-more-than-85-million-from-2014-to-2024
  6. Helms, Kevin. Microsoft Patents New Cryptocurrency System Using Body Activity Data.
  7. https://news.bitcoin.com/microsoft-cryptocurrency-system/

Background on the Author

As both a social entrepreneur and sustainability consultant, Amber Bieg has been working on world-bettering solutions since the early-2000’s. For the past four years, she has been envisioning, writing, and working with a small team on a localized peer-to-peer energy trading platform. In addition to inventing and developing technology solutions to environmental problems, Ms. Bieg has been supporting the development of emerging clean energy technologies, as well as working on policies and government programs that increase market opportunities and remove roadblocks to clean energy. With expertise in design thinking, marketing, and sustainability, she has worked with Fortune 500 companies, small NGOs, large municipalities to small rural communities on issues ranging from renewable energy to zero waste. Amber has an MBA in Sustainable Management from Presidio Graduate School and a BA from the University of Oregon.

Entrepreneur, writer, artist, thinker — topics: Sustainability, money, gender & power