Why Genecoin?

The story of Genecoin — part 2

Bernardo Monteiro
Feb 2, 2018 · 4 min read

I told you in part 1 of the story of Genecoin that when we created this cryptocurrency token, we wanted to build a marketplace around a bunch of smart contracts to speed up scientific research. And I asked–"why Genecoin?" Why couldn't we use Ether or any of the cool cryptocurrencies available? And my answer was just that: "we designed a whole ecosystem where Genecoins would come to life, into an autonomous and distributed business model." Well, you deserve further explanation. As I promised, this story continues.

So I ask it again: why Genecoin? And now I give you a more complete answer: (i) because we want to bring new money to the scientific community;
(ii) we want to enable the circulation of that money inside that community; and
(iii) we want to offer a new, autonomous, peer to peer, free of charge marketplace, built on trust with smart contracts and blockchain technology.

In this text, I'll talk a little about the two first reasons to use Genecoin. The third reason will be addressed on my third article about the story of Genecoin.

Let's start with the first reason. What do I mean by bringing new money to the scientific community? I mean bringing Genecoins, of course. But what does it represent to the scientific community? Is it worth anything? The Genecoin tokens we are creating on the Ethereum blockchain network can only be a kind of currency, or money, if it is used as a medium of payment or exchange, as a measure of value, as a unit of account and as a store of value. Genecoin can be all that if the scientific community trusts and supports the Genecoin project. Since we are creating 100,000,000 Genecoins from nothing, we will provide a new and complementary supply of money, but this will only be true if the scientific community welcomes Genecoin and our project becomes trusted.

That new supply of complementary currency that we call Genecoins will be designed, distributed, promoted and marketed to the scientific community. Scientists, together with their supply chain, funders and philanthropists, not forgetting traditional communities — owners of traditional knowledge associated with genetic resources — all those persons can become engaged with Genecoins. And they can benefit of Genecoins using it as a social currency.

"Do you know what is a social currency?"— Fabio Gouveia asked me on the first days of December 2017. I had no clue. "I guess Genecoins can be a kind of social currency…" — he said. So I googled it.

One of the first results was a PDF written in Portuguese by Marusa Freire, a Brazilian attorney at the service of Brazil's Central Bank. That document consists of 374 pages about many social currencies in Brazil and abroad. It is her PhD thesis, presented at the University of Brasilia (UnB) at 2011.

A second document from 2011 about social currencies, also written in Portuguese, but a little shorter, was a dissertation by Arilsom Martins do Nascimento, presented at the Federal University of Ceará for his Master's degree.

With those two documents I started my study on social currencies. And I learned a lot, specially on legal aspects of social currencies, from the problems to the solutions. These social or complementary currency experiences result in stronger economies in the communities where they are used. People and companies got richer!

Complementary or social currencies began to appear in the world during the 80s and today there are more than 3000 currencies in more than 20 countries on six continents. These currencies are more common in risky, challenged or poor communities. However, they can emerge in more developed and complex systems as the currency Punto transaciones in the small to medium-sized enterprise ecosystem in El Salvador after the economical crisis in 2008.

But wait… a social currency is not only about giving more money to the community. The currency designed, promoted and marketed to a certain community will be known and accepted by its members. That currency circulates in that community leading to a virtuous circle that tends to enhance its gross domestic product (GDP). Now I'm talking about the second reason to use Genecoins.

One of the best examples of social currency is the Palma currency, created by a poor community in the city of Fortaleza, in northeastern Brazil. When it began to circulate in 1997, only 20% of the wealth generated by the community was kept within the community. In less than 10 years, this rose to an impressive 95%!

The more a currency circulates inside a community engaged with scientific research and development, the more innovation should be produced by its members. So we expect that giving more money to a scientific community will not only increase the demand for existing products and services, but also increase the offer of new products and services.

We all learn at school that when the government issues new money without destroing the equivalent amount, that country risks inflation and the devaluation of its currency. But if you've heard about John Maynard Keynes and its countercyclical fiscal policies, you can suspect the inflation hypothesis is not necessarily true, or that in some cases, it can be avoided.

If you care about scientific research, about technological development and all the innovation that can be produced by the scientific community, meet Genecoin at http://genecoin.science, or at Campus Party, SP, on February 3rd, 2018.

If you want to participate or support the Genecoin project, leave a comment here or send us an email to channel@genecoin.science

You can also follow us on twitter @GenecoinScience, or on Facebook https://www.facebook.com/genecoin/

Stay tuned! This is not the end of the story. See you soon…

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