Cryptocurrency-Based Basic Income

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Nathan Schneider:

"Over the past few months, basic income advocates tinkering with Bitcoin and other online currencies have created a series of experiments under the premise that we can start playing with basic income now, whether the government gets in on it or not.

Greg Slepak, for instance, is the sort of Bay Area software developer who reads the Yelp reviews of homeless shelters to learn about their conditions. "We cannot say with a straight face that we provide welfare to Americans," he has concluded. "We don't." His response, of course, is software—in particular, Group Currency [1], a specification for online currency systems that provide basic income–like distributions of funds to all their users. He believes that the technology underlying Bitcoin—a database called a blockchain, shared among its users without need for central authority—makes this possible in ways that it wasn't before. When based on a blockchain, money itself can be a shared resource. "For the first time in the internet's history, mass ownership is possible," Slepak says. "It gives individuals back their self-determination, back their dignity, back their freedom."

So far the two projects Slepak recognizes as fitting the Group Currency spec are uCoin, which gives every member of the system a "Universal Dividend," and (possibly) Swarm, a cryptocurrency investment platform that refers to its payouts for all participants as a basic income. But there are other digital currencies being developed or discussed that include their own variants on the basic income idea, including the Kiwicoin [2] in New Zealand, Cubecoin [3], Strangecoin [4], the Worldwide Globals Organization [5], and the Basic Income Project, LLC. The ones using cryptocurrency have their own subreddit.

In San Diego, Alex Goodwin has more than just a schematic. The initial implementation of his idea, FairShare, is already up and running—it uses a bot on Reddit to pass out portions from a stash of donated bitcoins. Payouts are still small, but they're there for the taking. Slepak considers the FairShare specification "vague," but Goodwin wants to develop the project through practice, not theory. He takes as his motto an utterance of Satoshi Nakamoto, the pseudonymous inventor of Bitcoin: "We shouldn't delay forever until every possible feature is done."

Perhaps the most eyecatching digital basic income out there is the one associated with BitNation—"a collaborative platform for do-it-yourself governance" led by Susanne Tarkowski Tempelhof, a Swedish entrepreneur whose resume includes contracting stints in Afghanistan and Libya. The idea is to use blockchain technology to provide opt-in, state-like services free from the constraints of borders. Basic income is to be one of those services —alongside pensions, marriage contracts, and "contract enforcement"—though the program has fallen short of its initial $20,000 crowdfunding goal.

Tempelhof is outright opposed to a basic-income scheme coming from a government. "At Bitnation everything is done through voluntary means, rather than through forcing people through the use of—or threat of—violence," she says. "We believe voluntary participation is the only morally defendable way of doing things." (http://www.vice.com/read/the-cryptocurrency-based-schemes-that-would-pay-everyone-just-for-being-alive-456)


More Information

  1. Group Currency
  2. Citizens Online Income New Zealand