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<nettime> moving to a socially sovereign, post-westphalian, currency
Michel Bauwens on Wed, 28 Mar 2012 11:43:27 +0200 (CEST)

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<nettime> moving to a socially sovereign, post-westphalian, currency

Why the P2P Foundation is paying its salaries in Bitcoin

Michel Bauwens and Nicolas Mendoza:

The P2P Foundation thinks that readers may be interested in the
following recent development.

First, one word about the structure of the P2P Foundation. The
Foundation is first of all a virtual and physical community of
contributors, people who volunteer content for our wiki, blog and
other resources. This is entirely a non-remunerated activity and
creates our knowledge commons, which people in the world can access
for free.

Our wiki has about 17,000 articles which have been viewed more than
18 million times, with an average daily readership of 23,000 for our
p2pfoundation.net <http://p2pfoundation.net/> domain, which includes
the blog.

The Foundation is also a nonprofit association legally situated
in the Netherlands, and the Foundation "enables and empowers" the
collaboration infrastructure of the community. The legal structure
allows us to pay and receive income for activities that are related
for this purpose.

The Foundation also has a cooperative, with a separate legal
status, which will allow us to undertake activities for third
parties. The cooperative is conceived as being a global phyle
<http://p2pfoundation.net/Phyles>, a community-oriented enterprise
that aims to generate income for the contributors to the commons and
the Foundation, so that we become financially sustainable. As a phyle,
we operate globally with cooperators located in different parts of the
globe. The coop is dedicated to the common good of humanity and the
p2p knowledge commons in particular, and is aimed to sustain it, and
those who work for it. It is not a profit-maximising entity, but a
product-maximising entity. It operaties in the market, but Âfor the

However, because of administrative delay issues in the registration
process, our first external contract is undertaken under the aegis of
the P2P Foundation as an association.

In the context of our first contract with external parties, we believe
Bitcoin to be a major development, pregnant with symbolic meaning
about the future structures of the world-system.

First of all, Bitcoin is the first operational, socially-sovereign,
digital currency. While there have been many other local complementary
currencies, they always have issues of scaling them to a global plane.
Bitcoin exists, not through the creation of money by private banks and
national states, but because a digitally literate global community
decided to trust a particular instantiation of a protocol for the
distributed creation of money. It is part of the general trend of
the social design of p2p systems, to enable trust with strangers on
a global scale, and to align, instead of to oppose, individual and
collective interests.

The Bitcoin protocol started running, and generating Bitcoins, in
January 4 2009. It has been over three years now, and yet these
are still the very early days. Bitcoin already has developed
and impressive, if experimental, ecology of operational support
infrastructures and services. These initiatives are autonomous, driven
by no authority other than that which emanates from the needs of the
community of users and the nature of the Bitcoin protocol. At this
point, it is already working as a small-scale global reserve currency,
arguably a better storage of value than the dangerously burdened
Euros and Dollars. Indeed while the value of national currencies is
expected to decline in times of geopolitical dislocation, including
catastrophically at times, the value of Bitcoin is expected to rise
because of its inherent Âdeflationary design.

Value storage through Bitcoin has profound political implications,
as it is the first currency that decentralises the creation of new
units (or, Âmining in Bitcoin terminology), rather than the
current system where new money is created as a byproduct of new
debt. The whole worldÂs Âformal economy is backed by debt, and
debt is backed by violence. This can be verified by defaulting, and
subsequently resisting eviction: state force will be used sooner
rather than later. Bitcoin value storage is revolutionary as it
deflates the dark power of debt, and allows to envision a world where
this power of debt is no longer at the origin of economic activity.
Bitcoin draws its value from peer-to-peer network dynamics, and mints
new currency not through debt but through raw computational activity.
Moreover, this essential difference from the current system, we argue,
is actually in itself the most powerful claim to value of the Bitcoin
monetary system.

You can buy many different goods and services with Bitcoin, exchange
it with other currencies, etc It works on a global scale. Hence, it
is symbolic of the shift of our world system to a Âpost-WestphalianÂ
phase, a phase that goes not only beyond the dominance of the
nation-states, but also beyond the private global powers that have
hijacked global governance, such as the financial system of the 1% .
Indeed, this new currency can be created, under conditions set by the
protocol, by any participating computer. It is a true p2p monetary
system. A socially sovereign currency that can scale globally will be,
and is, a vital part of the emerging distributed infrastructure of
value creation that the P2P Foundation calls for. This does not mean
that Bitcoin is necessarily the final and perfect answer to our needs,
but it is an important step in demonstrating that it CAN be done. We
envisage the development of future Âforks and currencies that have
other qualities embedded in them, and call for monetary bio-diversity.

It is to demonstrate our commitment to such developments, that we will
now pay our collaborators in a mix of currencies, and part of it will
be in Bitcoin. The first of the members of the P2P Foundation to be
paid Bitcoin honoraries is our in-house researcher NicolÃs Mendoza
<http://nicolasmendo.wordpress.com/>. This first income was payed 50%
in Bitcoin, and we are committed to offer all of our cooperators the
possibility to receive Bitcoin payments at their convenience.

P2P Foundation: http://p2pfoundation.net  - http://blog.p2pfoundation.net

Connect: http://p2pfoundation.ning.com; Discuss:

Updates: http://del.icio.us/mbauwens; http://friendfeed.com/mbauwens;
http://twitter.com/mbauwens; http://www.facebook.com/mbauwens

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