What might the Future of Money mean for FCDO?

The Frontier Tech Futures programme started as an interactive group experience for FCDO (then DFID) staff intended to develop their confidence, knowledge, and skills using frontier tech. When switching to virtual delivery during COVID-19, we evolved to a programme that transcends sectors or countries and instead asks fundamental questions about how technology might affect the future. The first of these themes is the Future of Money, and this post outlines our process and the insights collected as we explored what this might mean.

We are witnessing the three characteristics of money transforming: as a medium of exchange, as a measure of value, and as a store of value. COVID-19 has accelerated the rise of e-commerce and digital payments, while in parallel we’re witnessing the rise of new digital currencies. These currencies are being created and backed not only by central banks, but also by individuals, communities, and private companies.

At Frontier Tech Futures, we have spent the past three months exploring the trends in frontier technology that might impact how we think of money. These technologies have the potential to change money, our lives, and the context in which FCDO seeks to meet its objectives⁠ — so we asked: what might money look like by 2030? Will money remain the domain of governments, or will there be a rise of transnational currencies? What role might institutions and technology play in determining access to money? The following 5 points outline what we did.

1. Scanned the literature for key trends, challenges, and emerging solutions

We began by reviewing what others have been thinking. Our aim was to uncover current trends to better understand how they could shape money in 10 years time, ranging from the role of governments adopting cryptocurrencies to the effects of personal data on digital identity. We also looked for weaker signals that might hint at competing futures.

A plethora of insights emerged during this stage. We explored how the digitisation of money will affect inclusion and whether cryptocurrencies could erode monetary sovereignty. We dived into concerns around transparency, asking ourselves if money will foster security or if it will eventually become a security risk for states. We also considered its impact on identity, and asked what this might mean for privacy?

We synthesized the research to provide us a starting point to our conversations with FCDO.

2. Surfaced priorities, insights, and questions with FCDO teams and experts

Integral to designing our exploration is understanding what FCDO is currently doing in relation to the topic of money. Once we uncovered what is already being investigated, we could narrow our exploration to what was most relevant and interesting

We held workshops with a number of FCDO staff, where they shared their perspective on money and what trends they foresee around money based on their own experience. While some had a lot to share, we also engaged with others whose work is less related to the topic but were taking the opportunity to think laterally and imaginatively about it.

3. Built future scenarios by clustering common factors and insights across trends

Next, the fun part. To uncover the extent and limitations of each trend identified throughout this process, we needed to imagine several scenarios for the year 2030 that would enable us to think about their effects on the world and on FCDO.

These scenarios did not aim to predict the future, but rather presented a range of plausible futures, helping us identify potential challenges and opportunities that could emerge. With them, we could envision and develop robust strategies to help us prepare.

For 2030, the three scenarios were:

• Decentralised cryptocurrencies are mainstreamed
• Fintech technologies as primary disruptors
• Central Bank Digital Currencies are mainstreamed

4. Added meaning to the future scenarios and identified implications to existing and future work

We invited FCDO advisors as well as key experts on money, cryptocurrencies, and digital identity to a workshop to dive deeper into the Future of Money. We built a skeleton structure for each scenario, but looked to those in the room to contribute their thinking, planning, and working with money to flesh them out.

We used the Government Office for Science’s Futures Toolkit to shape our thinking on running a horizon scanning workshop. This helped us to understand how to embed strategic long-term thinking into the process of building these scenarios, as one outcome is that they might contribute to high-level decision-making.

12 experts were split into groups, each of which explored a plausible scenario. They asked:

1. If this is the future, what are the main characteristics that define this world?
2. What are the crisis points that have led to it?
3. What are the second level effects? In terms of identity, security, prosperity, and inclusion?

The insights gathered developed our scenarios further, and our next step is to paint the picture of the three futures for those who couldn’t attend.

5. Collective reflection and surfacing recommendations

When we first started thinking about the Future of Money, our assumptions were that this topic would resonate with FCDO. We believed we would be able to map the networks across FCDO to tap into and invite the right people who are able to act on our scans of the future. We believed that if this engagement was a success, we would have supported FCDO teams and staff to think about the potential implications of changes in money and finance for their areas of work. We thought that this might lead to changes in strategy or to an increased capability in thinking about and discussing these issues with partners.

We learned that, for a topic this technical, three months was too short a timeframe to delve into every nuance and possible future of money but still long enough to identify some of the trends and issues to consider. There was also a need to bring experts in at an earlier stage to develop the direction of this engagement. Since the topic chosen resonated with every FCDO member we engaged with, we wished we had identified external experts sooner rather than later to guide our thinking, help us find diverse perspectives, and provide reassurance that we were minimising blindspots.

What next?

There is a clear demand for further investigation of these thematic cycles and, given that this was the first prototype, we can now use these reflections to inform the rest of our engagements. We’ll close the Future of Money by sharing our final insights, through a set of creative outputs, but we’ve already begun planning our next exploration cycle! Whether it will be the Future of Food, Work, or Security, we will be working with a new team of FCDO “futurists’’ who will help us define what these futures might mean for the organisation.