Digital Currency for Social Good: a Reading List
Resources + WIP Knowledge Map
A year ago I jumped into the world of digital finance.
It’s a steep learning curve.
This field demands a working knowledge of dozen interrelated disciplines, knit together and evolving: ethics bumps up against design principles against banking standards.
But the field is also urgent and timely, with lots of people interested in how blockchain technologies will affect our futures. I get asked all the time: “What do you read? What’s a good primer that would help me understand blockchain and its applications?”
This post will highlight the resources that affected my thinking. If you have suggestions for this list, let me know so we might build a living document.
And here we go, the learnings ordered by discipline.
Anthropology
Let’s start with a sweeping generalization: money is always cultural. The folks at the Institute for Money, Technology and Financial Inclusion (IMTFI) at UC Irvine know this well — in the fall of 2013, I popped into their office and caught sight of this meme up in a cube:
Is a unit of digital currency a commodity? A store of value? Credit? Is it different than the way we use money now? Who decides how it can be used?
Professor Bill Mauer, Dean of the School of Social Sciences at UC Irvine, takes up these questions and directs a whole boatload of researchers around culture and currency. I highly recommend his book: “How Would You Like to Pay? How Technology is Changing the Future of Money.”
Behavioral Economics
Behavioral economics focuses on the incentives of a given system of resources. Small changes in the design of a system — dedicating 5% of your gross income to savings, adding a 25 cent donation to your Whole Food’s bill — can have a huge impact later in life.
The discipline professes to help humans make the best choices in a given system, a design process they call “choice architecture.”
Small choices, according to Richard Thaler, the OG of behavioral economics, can have big influences on behavior. For instance, what happens if a user does nothing?
“Defaults are ubiquitous and powerful. They are also unavoidable in the sense that for any node of a choice architecture system, there must be an associated rule that determines what happens to the decision maker if she does nothing.” — Thaler, Nudge.
As designers, we have the opportunity to provide very important frameworks — Thaler’s work helps me design systems thoughtfully.
Bitcoin / blockchain
Bitcoin is complex and the resources out there don’t help. Here are a few that explain the system in plain language.
One is The Age of Cryptocurrency: How Bitcoin and Digital Money Are Challenging the Global Economic Order by Paul Vigna and Michael J. Casey.
Vigna and Casey identify five phases of learning about cryptocurrency:
For a more visual approach, the “block” visuals here help clarify distributed ledgers:
If it helps, you can think of a blockchain like a wall of safety deposit boxes in the sky. Each box has a unique number (the public address) and a slot in the front so others can put assets into it. The box owner has the key that matches the box address, which means only the owner can access and move their assets. A blockchain is thus a push model, just like cash or other bearer instruments. This is in contrast to systems that operate on an “authorize and pull” model, like card networks. — Adam Ludwin, CEO of Chain
This video from Institute from the Future is recommended:
Cryptography
The Code Book: The Science of Secrecy from Ancient Egypt to Quantum Cryptography, by Simon Singh
I’m slowly unraveling the basic magic of cryptography, from its origins in war and secret romance to granular substitution ciphers, the allure of prime numbers, the calm repetitiveness of frequency analysis, what it means to generate randomness. Here’s a figure that shows how simple encryption mashes up with a secret keyword: an instance of polyalphabetic substitution called the “Vigenère cipher.”
Cryptonomicon by Neal Stephenson. This book is why people should read and write fiction. For instance:
“Then there was nothing left to do but drink schnapps and talk about math.”
Futurism
People who possess the type of vision that’s narrowed to 100–200 years in the future are either lucky or delusional. But to make sense of them, you’ll need a framework to keep up with their warp speed ideas.
I’ve been making a habit of projecting an idea far into the future, designing the world I want, and then working backwards. It’s accelerated constructionism. It’s applied ethics.
“Flash Forward” a brilliant podcast from Gizmodo, does just that. From a multitude of disciplines — for instance, the reputation economy — they jolt you into a future dominated by such technological instruments, and then work you back to present day.
Global Development / Poverty
There are a several approaches to solving poverty, from systemic and structural to projects that support end-users.
I’ve begun to see economic security and stability as a foundational requirement for all other social justice initiatives. My approach is informed by fieldwork in Nigeria and these resources.
The quote that haunts me from this film frames poverty as exclusion, as being cutoff from the rest of the world:
“I’m frustrated with this idea that poverty means living on one or $2/day. That is a very bad way to state the problem. Being poor has something to do with being excluded from networks of productivity and exchange. That means cell phones, internet, banks, financial systems, educational systems”
— Andreas Widmer
Another key resource is Jacqueline Novogratz’s book The Blue Sweater: Bridging the Gap Between Rich and Poor in an Interconnected World where she recounts her efforts to frame development as local, always rooted in economic development, and sustainable without outside intervention.
This idea made sense because it relied on the strength of the local people rather than on the largesse of foreign consultants who would never have to reach into their own pockets. Here was a chance to build on something that was already working.
Microfinance Institutions (MFIs)
One of the best ways to learn about a domain is to see it critiqued — in art, in design, even in the field of microfinance.
Hugh Sinclair’s Confessions of a Microfinance Heretic is a total takedown of the microcredit industry from the inside. Sinclair does a complete 360-degree evaluation of every aspect of microlending, from how interest is measured, the extreme shortcomings of MFI software, how peer pressure to replay loans can have adverse effects in communities, to questionable loan structure, to how large banks engage the microcredit industry.
If you are looking for a more policy-oriented approach to MFIs and digital financial services development, I highly recommend the research coming out of Women’s World Banking — they do amazing work.
Non-Profit Governance and Funder Relations
When I plunged into the world of digital finance for social good, I had to get up to speed on governance for non-profits. Impact metrics, end-beneficiaries, tweaking our logic model — getting these pieces right are integral to a successful non-profit.
But first, I never thought the words “I love my accelerator” would come out of my mouth. Fast Forward is a mentorship program that grows your non-profit network and bridges the gap between technology and social justice. The experience for me was phenomenal, and I would recommend it for anyone running a tech non-profit.
The Stanford Social Innovation Review is a wealth of insight into the world of philanthropy, specifically about how different funders approach impact.
+Acumen will help you construct an ironclad Theory of Change/Logic Model, and their partnership with NovoEd is a really slick learning UX experience.
Payments
Payments were one of my biggest stumbling blocks, but thanks to Carol Coye Benson’s book Payments Systems in the U.S. I can use terms like “push” “pull” “float” and “settlement” with relative ease.
Planet Money’s long-form format gives much-needed context to abstract financial concepts. Their recent episode on an entrepreneurship initiative in Nigeria called “Nigeria, You Win” is especially brilliant.
Quantum
Quantum superposition translates to massive parallel processing power, which helps to answer optimization questions, as in “which is the best route / price / time?”
If you are a poet, quantum will make more sense than another other law you’ve had to endure.
The Path Forward: More Resources, More Distributed Knowledge
As you can probably see by now, synthesizing this information from across domains is a challenge — but a really interesting one. Personally I never thought I’d work on learning design for bankers, travel to Nigeria, or pitch IDEO a “Coinstar for Coffee Beans.”
However, this field needs to distribute the expertise — a diversity of voices, of resources and applications. We’ll be stronger with different points of view.
Let’s start with building a body of knowledge. What else should be on this list? When did digital currency “click” for you?
Drop a line, share a resource, or share this post with someone who might.
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