Re-engineering finance as an expressive medium
Econo-philosophical background for the Economic Space Agency
This text is a collective work. It has been co-written and edited with Skye Bougsty-Marshall, Laura Lotti, Joel E. Mason, Jonathan Beller, Pekko Koskinen, Tere Vaden and many other fellows from the Economic Space Agency.
Preamble in the shape of an offering
The power of finance in our hands doesn’t need to be just about raising funds or making money. It can be an invitation to risk and speculate together to open up new possibilities and modes of coming together.
For most of us, finance is a predatory and extractive practice that takes more than it gives. But what if at the heart of finance we found a logic of active offering? A ritual offering gesture — the creation of a time interval in the derivative form of a gift — that both opens up and holds open new economic spaces?
For we are always already at stake with each other, partnered all the way down. Inhabitants of the world, earthlings and earthbounds, creatures of all kinds, human and non-human, we are entangled in series of interlaced trails and creative feedback loops, holding open life for one another. In the economic spaces to come — the world we want — everyone holds pieces of each other’s life, socially and financially. We are entre-preneurs and entre-donneurs — inter-holders and inter-givers — networked together to collectively distribute the risks and opportunities of living.
Toward Programmable and Non-Linear Economic Spaces
This is an historic moment. Following the emergence of blockchain and similar decentralised digital technology, social, economic and financial forms are becoming for the first time integrally programmable.
Every digital platform, from goliaths like Facebook to the fringest of forums, creates a space of encounter and gathering, generating values of different types. We use the term economic space to designate the material and immaterial system of coordinates and attractors that gives shape to how people create and interact with resources, assets, values and their different modes of expression and representation. We conceive of these economic spaces as non-Euclidean. The term may sound strange or even extravagant, but non-Euclidean economic space has a specific meaning.
An Euclidean economic space is defined by the competition of economic agents over scarce resources. The individual agents are deemed to have clear and persistent boundaries, and relate to each other via linear transactions. In a Euclidean economic space, something pre-produced is divided. This is the space the politicians and economic experts talk about when they say there is no alternative to the current economic system and ask us to blindly abide to austere monetary policies.
In contrast, non-Euclidean economic spaces move beyond the imaginary of limitations, austerity, scarcity and powerlessness, foregrounding a continuous unfolding of possibilities, options, connections and creativity. When resources and affordances get shared on a distributed platform, they become nomadicand start to mutate. Non-Euclidean economic spaces call for a non-linear distribution where nothing pertains or belongs only to one person, but all persons are arrayed here and there in such a manner as to make possible a greater range of interactions. Nomadic economic spaces are the associated milieu of the networked tribes of the 21st century. They are the spaces of continuous innovation and metamorphosis. Think of them as n-dimensional programmable and vibratory organizations that allow for the creation and circulation of new types of value. Econauts will navigate these financial and futurial borderspaces that are not hard and bounded — liminal spaces that allow you to fold yourself within and without.
The goal is to opensource finance: to build an easily usable launch pad for rapid creation, deployment, sharing, customizing, copying and remixing of modular, interoperable and self-governing economic spaces. The platform we are building, called Space, enables communities and individuals to make their own offers, issue their own programmable tokens and set their own value systems. As such, the design of economic space becomes a means of collective self-expression, that is: an occasion to enunciate and manifest financial values that escape the disfiguring market logic of generalized equivalence. Through the platform’s template approach, users have access to flexible tools to invent and construct new (or simply reproduce existing) modes of organization to leverage the unrealized value of socially networked production.
Currently, every process of value creation is forced to plug into an exploitative monoeconomy, a core system that flattens out all other forms of value. Like monoculture relies on one crop, monoeconomy relies on one form of value. The resulting financialization of the social has fostered spiraling indebtedness, the decreasing price of labor, and erosion of the welfare state. Yet, from households to cities, from software to trade, the work and very being of people are what backs the underlying value of finance. This unrecognized backing means we are tethered to the current instruments of finance as the sole abstract means by which we access new value. These financial forms depend on us for their vitality, and yet we depend on them as well, having no other means of accessing and sharing value without them.
We are only seeing the beginning of an intensive and multi-faceted process of decentralization and redefinition of socio-financial relations towards greater multiplicity and autonomy. One way of critically engaging with this nomadic re-engineering of finance is to envisage it as an expressive medium. In essence, finance is not primarily about money: it is a mode of coordinating the future and its emerging possibilities through the collective design of attractors and the distribution of flows of desire. Finance thus appears as the opening of a shared temporal interval in which new things can happen by risking and speculating together.
Finance concerns the capacity to bring future potential into the present through monetization, enabling future investments in the present by making them liquid. The possibility for financial actors to manufacture financial instruments out of debt and equity, thereby impacting volatility and liquidity in markets, has become a political weapon to orient and organize the masses. In response, we want to approach finance with a hacker attitude and a poetics of experimentation.
This is our wager: we want everyone to be able to harness the power of finance as a technology for coordinating and sharing the future in which we want to live.
How to do it?
Prior to the innovation of blockchain, there was no way to maintain the state of a distributed ledger in a decentralized manner. It was therefore necessary to rely on centralized control and ownership of data at the application layer by monopolistic corporations like Google, Facebook, Amazon and eBay.
Bitcoin introduced blockchain technology and cryptocurrency to the world, creating a decentralized network of trust, optimized for resiliency, verifiability and anonymity. Ethereum then built upon the consensus-based decentralized architecture of Bitcoin, adding a Turing complete scripting language with which to build applications. P2P crypto-currencies, smart contracts and second-generation blockchain tokens are introducing new ways of coordinating vast networks, as well as new ownership models based on mutual stakeholding in the protocol layer.
While crowdfunding and P2P lending are the first steps toward the disintermediation and personalization of financial relations, the next phase in technological and financial development must involve the possibility for everyone to gain concrete access to the design of their own economic agency. Both Bitcoin and Ethereum are fundamentally based on the same computing platform, a “World Computer”, run by every node on the network, processing every line of application code run by every application in the system. This replication has tremendous benefits in terms of transparency and fault tolerance.
However, the World Computer architecture introduces redundancies and limitations that can be inconvenient and inefficient for many applications. Smart contract-based applications have become varied enough so as to benefit from more flexibility than the World Computer architecture typically offers. A new wave of beyond-blockchain or blockchainless distributed ledgers are appearing, promising scalability and a combination of private and public contracts.
Instead of a World Computer implementation, Gravity offers a platform for building interoperating networks of decentralized computers — a World Computing Fabric architecture. World Computing Fabric is a modular, object capability-oriented architecture for building resilient, verifiable networks of virtual machines. This enables a new approach for creating systems and protocols for the digital economy.
Beyond extractive finance: toward expressive mutual stakeholding
While financial institutions and corporations are seeking to take advantage of blockchain affordances, they merely reproduce old familiar models and logics on these emerging technologies. But the new smart contract platforms have not yet been irretrievably colonized by existing financial interests. We have a small (and closing) temporal window to create something else. As the history of the Internet shows, the early adopters will play a profound role in shaping the sense and direction of the novel, emergent economic and organizational forms that might, one day, be as commonplace as social media today.
The current financial system is essentially based on relations of debt and equity — the former concentrated in the hands of the many and the latter controlled by the elite few. The increasing supply of government bonds (safe means for capital preservation) is possible only through deficit cuts and excluding all inflationary spending. Presently, expansion in the forms of indebtedness is the condition for capital accumulation, just like the growth of labor force participation was for expanding commodity production.
We want to change this state of affairs by promoting relations of equity between the different economic spaces. By doing so, we conceive of the economic spaces built on top of the platform as partners, rather than subjecting them to the extractive relations that characterize the contemporary financial paradigm. Equity acts as the horizontalizing force through which all econauts have access to, share in, and harvest this derivative value made available through the interoperability of heterogeneous abstract metrics. By offering the possibility to participate (i.e. have actual stakes) in occasions for financialization through equity relations, the platform enables the collective steering of financial dynamics and mechanisms for the purpose of collective redistribution and overspilling of values. It does so by concretely giving econauts the ability to issue their own tokens (and other kind of instruments) — that is, providing the capacity to index those values they want to share and sustain according to metrics they determine. This unprecedented move furnishes liquidity to the social and relational insensible production of value, and allows for the circulation/distribution of that liquidity in an ecosystem that collectively acknowledges those values — for the collective livelihood of that ecosystem.
By activating our mutual stakeholding with equity relations, we offer people production power, finance’s future-wielding capacity, rather than merely empty consumption power. As a technology for the de-differentiation of risk and value flows, synthetic finance becomes a powerful instrument for the dynamical creation and distribution of common equity, as the lifeblood circulating through and interconnecting the ecosystem.
Following a crucial insight developed by Randy Martin and further extended by the Volatility Reading Group, we think of financial derivatives as a technology to amplify the power of autonomous organisations, once it is used in the context of self-created economic space and made accessible through easy UIs and ready-made templates. These financial instruments organise — weave together, distribute, branch — economic flows, and thereby create new modes of relation, modes which were previously unavailable, impossible, or even nonexistent. By operating the instruments of synthetic finance, one gets to arrange the attractors of one’s own behavior, to shape the rhythms and patterns of the economic spacetime where behaviour itself expresses. With the Space platform, it becomes possible to express “the way we are social with each other”, the mutual indebtedness and collective stakeholding that compose our common wealth.
Responding to the financialization of the social, the inherent flaws of the sharing economy, the tendency toward the automation of work, and the limitations of current blockchain solutions, our mission is to provide an open yet safe platform for the interoperability of heterogeneous value and risk systems and the scalability of token-based economies to create new social, economic and financial relations. Just as the internet fundamentally changed communication by transforming the role of author, publisher, photographer, and media maker, we want to transform finance, potentially enabling hundreds of millions of people to author economic spaces and control their financial relations.
With the Space platform, you will be able to leverage the power of finance — the power of risking and speculating together — allowing participation in a multi-dimensional ecosystem of economic spaces relying on equity relations and all sorts of optionalities. The time has come for people to take finance back into their own hands so as to make a claim on the enormous amount of wealth surrounding us. In the end, ECSA is committed to support a collective shift from finance as a technology of capital based in debt and primitive accumulation to finance as a form of production of new kinds of equity relations and commonfare production.
Postlude: Félix Guattari foreseeing Economic Space Agency
“It is less and less legitimate that only a profit-based market should regulate financial and prestige-based rewards for human social activities, for there is a range of other value systems that ought to be considered, including social and aesthetic ‘profitability’ and the values of desire. Until now, these non-capitalist domains of value have only been regulated by the State; hence, for example, the esteem in which national heritage is held. (…) Beyond recognizing a universal basic income — as a right rather than as some kind of ‘New Deal’ — the question becomes one of how to encourage the organization of individual and collective ventures, and how to direct them towards an ecology of resingularization. (…)
What condemns the capitalist value system is that it is characterized by general equivalence, which flattens out all other forms of value, alienating them in its hegemony. On this basis we must if not oppose, at least superimposeinstruments of valorization founded on existential productions that cannot be determined simply in terms of abstract labour-time or by an expected capitalist profit. The information and telematic revolutions are supporting new ‘stock exchanges’ of value and new collective debate, providing opportunities for the most individual, most singular and most dissensual enterprises. (…)
It must also be stressed that this promotion of existential values and the values of desire will not present itself as a fully-fledged global alternative. It will result from widespread shifts in current value systems and from the appearance of new poles of valorization.” Félix Guattari, The Three Ecologies, translated by Ian Pindar and Paul Sutton, The Athlone Press, London 2000 (1989), p.64–66.
