Exciting Commerce // Unlimited

Web Currencies: Cyclos as Online Account For New Currencies

In the past years there has been a trend towards community currencies.

The basic idea of such complementary currencies is to facilitate good ol’ fashioned bartering in what has been traditionally limited to a relatively small geographic area.

Particularly interesting is how these new currencies make use of the internet.  In the example of the Havelblueten (German link), a currency used by some communities in the Potsdam region of Germany, the issuers of the currency recently unveiled online accounts for individuals, self-employed and businesses.

The Havelblueten account is implemented by Cyclos, a currency software developed out of Holland and is available as open source. By now, there are several implementations of the software internationally.

As opposed to decentralized solutions like Ripple, which relies on the trust between the participants, Cyclos works in a relatively traditional manner:  The currency issuer can set the exchange rate to the basis currency, input important parameters such as interest rates, circulation fees, etc and then start running.

Cyclos offers a complete package from payment processing to administration of micro-credits and is appropriate for both local currencies and potential web currencies.

Related posts:

• Web Currencies: Social Currencies for You and Your Friends
• Web Currencies: Trust in Distributed Systems
• Geek Credits: Web Currencies vs. Local Currencies

Originally posted in German by Jochen Krisch, translated by Jason Soo.

Web Currencies: WeBank – Can People Replace Institutions?

Maybe it’s no surprise that new initiatives on the web-currency theme are pouring out of Great Britain.

The British pound is down and the decline of the currency is already more apparent in the UK than in other countries that depend on less independent currencies like the US Dollar or the Euro.

Alternative British projects with potential include KuberaMoney (“Banking of Trust”) and WeBank (“Can People Replace Institutions?”), an event based in London which digs into this topic:

"While in the past web-enabled innovation in the sector meant online banking and web-access to front-end customer services, there is today a growing set of organisations which remove banks and other institutions as intermediaries altogether."

A detailed announcement for the WeBank can be found at OpenBusiness. And for everyone who's interested in these topics the Nesta Connect Blog belongs in the feedreader.

Originally posted in German by Jochen Krisch, translated by Jason Soo.

Geek Credits: Web Currencies vs. Local Currencies

In the last couple of years we have seen the rise of local and regional currencies as complementary currency systems. But why do we still focus so much on local currencies in an increasingly interconnected world?

Don’t people think, trade and work increasingly in a cross-border manner? Why should currencies be bound by purely geographic limitations?

Aren't there any other (perhaps social) structures that could be far more suitable? And why can’t social networks such as Facebook, LinkedIn & Co be the perfect levers to bring these ideas into reality? After all, Facebook with its over 150 million global users represents a population greater than many large countries and is still in need for a business model.

How can decentralized financial systems be applied in practice?

In addition to previously blogged Ripplepay (“Social Currencies for You and Your Friends”), Geek Credits is another good example for a currency model in a social context:

"If you provide a service for community (writing free software, providing your band's mp3s for download, etc) you may ask users to pay you Geek Credits.

You may also pay Geek Credits you received or issued yourself to anyone who agrees to accept them. Issuing a Geek Credit means a commitment to provide some service in the future to the community."

Aren’t these any less worthwhile (thought) experiments compared to simply staying trapped in a regional/national context? We are looking forward to more examples.

Originally posted in German by Jochen Krisch, translated by Jason Soo.

Web Currencies: Trust in Distributed Systems

Talking about social currency systems, a good presentation to see is the “Network of Trust” talk by David Hales, given during the ECCS Conference for Complex Systems 2007 in Dresden, Germany, where he explains distributed currency systems like Ripple, too:

Many of the other conference presentations are also available in video format.

Originally posted in German by Jochen Krisch, translated by Jason Soo.

Web Currencies: Social Currencies for You and Your Friends

How could a (social) currency system look like that can be used between friends and family?

It is part of the bigger question: How is value created within social networks and how can we measure it.

Arne, one of our German readers directed us to Ripplepay:

"Ripplepay.com is a payment system where you can be your own banker. Connect to your friends, family, and associates and your credit with them becomes a fully-functional currency."

The principle of the Ripple project is well described in the following concept paper ("Money as IOUs in Social Trust Networks & A Proposal for a Decentralized Currency Network Protocol").

In the social context, people speak less about money and currency, and rather more about (social) favours.  “Go talk to my buddy there, he anyways owes me a favour”.

“Social Currency Systems” operating within a group of friends need to transfer these principles of bilateral favours and the exchange of services (“large and small favours”) into quantifiable units. That’s basically what Ripplepay does.

It remains to be seen if Ripple (see Wikipedia article) in its current form will be applicable in practice. But the effort itself is already notable.

Recommended reading is the book The Future of Money, by Bernard Lietaer.

Originally posted in German by Jochen Krisch, translated by Jason Soo.

Woot! 2009 - A New Look For A New Year

Exactly four and a half years after its launch Woot! presents itself in a totally new look (via):

The proper response according to Woot!: "I'M DROWNING IN PEA SOUP!" and "OMG ITS SO WIDE!" You choose. But, seriously, Woot! leads the pack again - from 2.0 to green.0

Of course Wine.Woot! and Shirt.Woot! changed as well.

Related post:

• Woot! 2008 - The Year in Review

Woot! 2008 - The Year in Review

2008 not only was another record year for Woot! but also a year of optimization in every respect.

For the first time since 2004, the Woot! team didn’t launch any new sites and instead dedicated its energy to building up and stabilizing their existing sites (Woot!, Wine.Woot!, Shirt.Woot!, Sellout.Woot!).

Where Woot! fought every month for its successes in 2007 (see 2nd chart below), a cornucopia of optimization measures significantly stabilized the situation in 2008:

The only substantial disappointment of 2008 was the month of May (9% below the previous year), when Woot! lost previously reliable bestsellers (with expected revenues of over $500,000) and had to settle for a topseller of the month which brought in a relatively weak $357,000.

With some difficulties remaining in June (3% below the previous year), Woot! stabilized from July onwards and even posted revenues in September that were over 50% better than the (admittedly weak) previous year.

Relative to the orderly 2008 fiscal year, 2007 was for Woot! a rollercoaster ride:  Woot! at that time regularly made up to 50% or more of their monthly revenues just shortly before the end of the month.  The overall picture was accordingly bumpy.

The revenue chart for 2007 (below) shows neither continual growth (as we know from the likes of Etsy & Co.), nor a seasonal pattern such as typical with classic (online) commerce.  The first such patterns are only apparent in the 2008 chart above.

Woot! appears to be getting its business more and more under control. Therefore it can doubly benefit from the experiences of the previous years – the core business is still growing. And a one day record of $1.9 million in 2008 (compared to $1.3 million during 2007) shows: there’s still room to grow.

Originally posted in German by Jochen Krisch, translated by Jason Soo.