Intention:

These are questions to get the creative juices flowing and open the inquiry wide enough to glimpse new ways that currencies could facilitate healthy flows in your community. The FlowSpace process helps people plan and understand flow in their system design like a relief map helps predict and understand water flow in a landscape. It helps you shape your community landscape to create the interactions and resource flow that you need for a healthy community.

1. Membership

Building a lively flow system may mean adjusting your perception of who your target community actually is. You may need to expand it to include other people and create enough diversity of what people have to offer and share. You may need to contract it (you probably can’t appeal to everyone) to focus on a community with a shared language and worldview such that you can find common problems, interests & needs to address. Your membership serves as the points between which everything flows. Goods, services, trust, faith, acknowledgment, appreciation, acts of kindness, wisdom, donations, prizes, promises, requests, information, gifts, admiration, commendations, myths, stories, and a sense of belonging are some of the things flowing between them.

• 1. Who are the key groups of people that are part of your community?
• 2. Who isn’t a part of your community but wants to be?
• 3. What kind of people do you want to attract to your community?
• 4. What types of people distract or detract that you don’t want to draw more of?
• 5. Who are the other people or groups who have things that your members value or would want to connect with?
• 6. Who are other people or groups who want to connect with your members or value what they have to offer?

2. The Money Trap

All too often people think of currencies in terms of money used for exchanging goods and services. This is one small aspect of flow. Think back to the long list in the membership section of things that can flow between people. Avoid the pitfall of thinking solely of “commercial” exchange.

• 1. What kinds of participation and citizenship do you want to encourage?
• 2. What ways do you want people to experience belonging, reward, or acknowledgment?

We all know that money doesn’t necessarily provide those things, but it doesn’t mean that currencies can’t bring them to life in a community. We use currencies unconsciously every day that are not like money. The grades you earn for school coursework are a kind of performance measure and incentive. The credits earned for completing that course are unit of account. Neither are transferable or cashable, but combined, a person can redeem them for a token of status currency called a degree.

Dr. Joyce Brothers, Sir Lawrence Olivier, eBay ratings, a Four Star Hotel, the Honorable Judge Anton Scalia, Employee of the Month, Olympic gold medal winner, “Two thumbs up,” Academy Award winning nominee, Summa Cum Laude, black-belt, merit badge, Congressional medal of honor, Pulitzer Prize winning writer, Nobel Prize winner… We have innumerable measures and symbols of status, quality and respect. These serve in their circles to incent particular kinds of behavior and discourage others. People don’t want to get disbarred, they want to be exalted.

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• 3. What are the forms of exaltation that will be valuable and meaningful to the people in your community?
• 4. What are there forms of recognition which will speak deeply to the members of your community?

Learning from Flow Systems

We are going to use some metaphors to illustrate aspects of different flows. In each case we’ll emphasize particular features of the system hoping to spark a connection to the needs in your project and community.

3. The Water Cycle and Landscapes

Water evaporates from the oceans, rising into the air as vapor. The vapor travels in clouds and condenses as rain (or snow, mist, etc.) falling on land. The water then flows downhill finding its way back to the ocean. Perpetuity/Balance: There is a complete circuit – a way for the water to get back to where it started and begin the process again. The system has what it needs to replenish itself. The oceans don’t dry up from the evaporation and the land releases the water back its source.

• 1. How does your system function as a complete circuit where the currencies can flow freely to return their source to flow forth again?
• 2. Where are your currencies issued or created?
• 3. Where are they redeemed or retired?

Diverse Paths: Rain may run off a hillside into a creek which works its way to a river which in turn is a tributary to a major river like the Mississippi or Amazon. Rain may soak in to the soil and be absorbed by a tree and become incorporated into its sap. It may gather in a puddle or a lake and be drunk by a person or animal and only to be urinated into a sewer system where it is processed and recycled into a municipal sprinkler system to become a puddle once more.

• 4. How can allow your currency to be flexible enough to flow different paths?
• 5. Should you be focusing on the major arterial rivers or the tiny run-off paths?

By-Product(s): Places with no water are called deserts because they are largely deserted of life. Places with abundant water flow, such as rainforests, have rich ecosystems teeming with life. Life itself is a natural by-product of the water’s flow even though it is not the final destination for the water. This is not a cause and effect relationship, but rather a relationship of essential ingredient. Dumping water onto a patch of desert does not spontaneously cause life. It simply enables or permits it to emerge. Other ingredients (such as seeds) are also required. Over time, if you keep dumping water there every day, the chances are good that new life will naturally begin to appear. However, engineered by-products, such as electricity from a hydroelectric dam, do rely on water as the immediate causal force to fuel them.

• 6. How are you including all of the essential ingredients, instead of relying too heavily on one and hoping that the others appear?
• 7. Are the intended outcomes of your project engineered or naturally emergent?
• 8. Do you have the staying power to keep things flowing until the emergent by-products show up?
• 1. All designed systems have both kinds of by-products. It is smart to make sure both types of by-products create desirable outcomes. It is wiser still to make sure that that the immediate engineered by-products are compelling enough to keep things flowing such that the natural ones have time to emerge. How are you doing that?

Interlaced Flow Systems: When the water becomes part of tree sap or a person’s bloodstream, it has been converted to a different “currency.” It then participates in that flow system until it is “converted” back to water.

• 10. How can you allow your currency to convert to other forms necessary to support local and diverse sub-systems?
• 11. Is your project a small sub-system or something which is intended to nourish many others?
• 12. If it is a sub-system, do you have adequate nourishment from the larger system to survive? (This often means viable cash-flow in hard “money.”)

Flow Pressure: There is always “pressure” to keep the system flowing. On land, gravity keeps water in motion flowing downhill to the lowest point it can reach. When gravity is thwarted and the water pools in puddles, lakes or oceans, then evaporation takes over and ensures that the water rejoins the rest of the cycle.

• 13. What is the pressure to keep things moving in your system?
• 14. In what ways might it benefit you to build in circulation incentives (such as expiration dates, demurrage or increased reputation)?
• 15. If you had multiple kinds of flow pressure, what would those be?
• 16. When currency is pooling in your system, how can it be re-mobilized?

Co-Evolving Shapes: The landscape guides the water in fairly predictable flow paths. It is tempting to view this as a causal relationship where hills, valleys, rocks and gullies determine the flow of the water. However, over time it is more of a dialogue between the water and land where the water flow is reshaping the landscape with effects as large as the Grand Canyon.

• 17. Identify the “landscape” of your community. How would you describe it?
• 18. Where is there enough disparity of your members to create a “downhill” for flow? (If everybody has the same needs and gifts to offer, why would there be any flow?)
• 19. How are you and your members prepared to allow for the natural evolution of your flow paths?
• 20. How are you setting up the flexibility to adapt to changing resources, needs and members?

Scarcity vs. Sufficiency: There is a common mythology among economists and money theorists that currencies have to be scarce. This may be true for certain kinds of currencies which are arbitrarily created and have no inherent value to them, but it is certainly not true of all flow systems. Three-quarters of the earth is covered in water, yet it is clearly one of the most essential “currencies” for life. Its abundance does not diminish its value. In fact, if life primarily required scarce ingredients, this would be a pretty dead planet. It is typically feasible and desirable to design flow systems for precise sufficiency, where the amount of available currency expands as the need for it increases, and contracts as the demand diminishes.

• 21. Where does your system require sufficiency or artificial scarcity?
• 22. How can you measure the demand?
• 23. How can you adjust the availability of your currency?
• 24. Who gets to create it or issue it?
• 25. How does it get retired or removed from circulation?
• 26. Will you achieve enough flow if you create the currencies value through scarcity?

Multiple States: In the water cycle, the currency (water) actually flows in different states and forms. It evaporates as a gas, condenses and falls as droplets or crystalline snow or ice, and collects or flows to the ocean in large liquid masses. Although it is fundamentally the same H20, it behaves differently in each state. In fact the state change is required for the full circuit to be completed. Most people don’t realize that our national currencies do this too. When you deposit a $100 bill into your savings account, your money just changed states and starts to behave differently. You now earn interest on it. Your bank can now “create” more money by loaning 90% it to another person or business. As soon as you convert it back to paper it loses those properties. There are other “states” that dollars can be in, which we unconsciously convert in and out of every day by writing checks and using credit cards.

• aa) Does your system require “state changes” to allow your currency to flow in specific ways or to specific sub-groups in your community?
• bb) Can you maintain consistent value across these states?
• 200. Do you need to have people view the currency in each state as the same or different than when it is in another state?

4. An Electrical Circuit

You turn on your car headlights and a flow path (called a circuit) gets created between the two poles of your battery. The electricity follows this path through the bulbs in each headlight, causing a filament to light up. Complete & Bounded Circuit: Again a flow path with a complete circuit is required, but in this case the path of flow is carefully engineered with little left to chance. Unlike the unbounded flow of water on a landscape and the multitude of permutations in its flow path, electric circuits have narrow paths (wires) to which flows are constrained.

• 1. How would unbounded flow paths accomplish your goals?
• 2. How would carefully engineered boundaries of flow accomplish your goals?

Engineered By-Products: The focus is on deterministic outcomes of the flow, such as powering a light, starting the engine, moving the wipers, rather than emergent ones. In fact all the emergent by-products are viewed as undesirable “side-effects.” (Static which interferes with the radio, a person getting zapped by the current, accidental sparking during fueling which blows up the car, etc.)

• 3. What is the focus for by-products in your system?
• 4. What are there undesirable outcomes you may want to safeguard against?
• 5. What are the engineered outcomes necessary for your success?

Single Path: When an engineered flow path fails by either a “short-circuit” (closing the circuit too soon), or a gap (like a wire jiggling loose) failing to complete the circuit, then the headlights don’t turn on. In an unbounded flow system, there may be thousands of ways that a circuit can be completed (ways for the raccoon to find water), but in a bounded flow path, a single failure can interrupt all flow.

• 6. Where are there places in your system where you may need to create redundancy?
• 7. How can you safeguard better against shorts or gaps in some of your critical activities?

Disparity & Differential: The differential between the positive and negative poles is what causes electrical flow in the circuit. Just like water gushing downhill, disparity is required for the flow to take place.

• 8. What are the clear pockets of resources in your community which map well to other clear pockets of needs?
• 1. How could you engineer a circuit to connect them?

The Light Switch: Energy flow is started and stopped by throwing a switch. It’s much like the opening and closing of the Stock Exchange – one minute there’s a flurry of activity and flow, and the next, it’s all been turned off.

• 10. Where are there places in your system where you are able to turn the flow on or off at different times?

Stored Energy & State Changes: There is a state change for the currency in this system too. The flow through the circuit is from the difference in electric potential, so electrons flow through the wires. The energy in the battery is stored as chemical potential. Electricity is converted to chemical potential when it is used to charge the battery, and converted back again when needed to flow through the circuit. Interestingly this maps to two different roles of currency, storing value and facilitating exchange.

• 11. What are the reasons to create long-term stores of value for people in your system?
• 12. What are the reasons to create currencies which are designed to flow rapidly and smoothly?
• 13. If you need to convert between them, when and how would you do this?

5. The Circulatory System

Blood flows through your body bringing oxygen, nutrients, enzymes, antibodies and other special purpose goodies throughout your body where they are needed. Different Elements in Single Flow Path: Red blood cells, white blood cells and platelets flow through the same veins and arteries, but they each fulfill play different roles. Red cells are carrying oxygen, white cells are carrying immunities, and platelets are ready to block leakages. Each is vitally important, but their flow is inseparable. Unlike an engine (next section) where flow of fuel, air & electricity travel quite distinct paths, the circulatory system relies on a single flow path.

• 1. Does your project need currencies to fulfill varied roles, yet still exchange through the same hands?
• 2. How does trust travel with payments?
• 3. What are ways to design transactions to combine multiple currencies in your system (like paying 50% cash, 50% points)?

Main Pump: The circulatory system relies on the heart to pump the blood throughout the body. The heart provides the pressure required for movement. No pressure, no movement.

• 4. What are the main drivers for your system which can provide the motivation for flow throughout?
• 5. How are you setting yourself up to be able to “pump” flow in your system?

Inflows & Outflows: The circulatory system has two main paths. Arteries carry the oxygen rich blood out to the extremities and it travels back to the heart through the veins.

• 6. What different paths might your system require for sending currency out and receiving it back again? (Example: A city government could issue a currency through special grants, and receive it back again from the community as taxes.)

Central Juncture: The heart is not only a pump, the central junction point where the flows converge. It receives oxygen depleted blood back from the veins, and exchanges the carbon dioxide through the pulmonary system for new oxygen.

• 7. What is the key juncture in your system? A place where the resources can be collected and redistributed to other places they are needed?
• 8. What are the ways that “depleted” resources can be renewed?

Self-Repairing: One of the main ingredients of blood (platelets) has as its primary job fixing leaks in the system.

• 1. What are the ways that you can have your system be self-policing / self-monitoring / self-correcting?
• 10. Who detects problems and how?
• 11. What kinds of problems? How will each be addressed?

6. Combustion Engine

Convergent Currencies: For an engine to function it requires multiple essential flows. Fuel to burn, Air for the fire to breathe, and Electricity to ignite the fire. The engine’s power comes from the convergence of these three at the right time & place to create an explosion.

• 1. What are the special ways currencies can converge in your system to provide additional power? (Examples: Allowing a person to redeem points for prizes when they’ve achieved a particular reputation standing. Providing a way for feedback scores to affect the price people pay for things.)
• 2. Is there a special chemistry to connect the flows in your project?
• 3. How will your currencies be strengthened by specific interactions between them?

Multiple Flow Paths: Unlike the circulatory system where the different ingredients all flow along the same paths, the three ingredients needed for an engine to function are scrupulously kept in separate flow paths until the moment of combustion. Then a fourth flow path is required for the exhaust. Each path is separate and critical. You can stop the engine by blocking its exhaust flow as well as blocking its fuel flow.

• 4. How have you ensured healthy flow paths for all of the critical ingredients for the success of your system?

Meta-Flows: The engineered by-product of your engine is used to move your car. This allows you to participate in another flow system – traffic flow. Isn’t it interesting how a breakdown in fuel flow in the engine (running out of gas), can cause another whole breakdown in traffic flow (while people have to drive around your stalled car)?

• 5. What are the subsystems which you need to be sure are flowing smoothly so your main system can flow unobstructed?

7. A Busy Beehive

One last model – we’ll keep it short. Bees flit around from flower to flower collecting pollen. They bring it back to the hive and make honey. Serving Different Masters: From the perspective of a beekeeper, the purpose of a beehive is to make honey, but from the perspective of the surrounding ecosystem, the purpose is to provide cross-pollination and fertilization services. A business is much the same way. From the shareholder’s perspective, it should make money. But it must provide value to its surrounding community, or it will fail. Currencies are no different. Frequent-flier miles serve a particular purpose for the airlines, but have a different appeal to their customers. Many currency projects fail because they only emphasize the “greater good,” so they don’t acquire the tangible resources provided by sponsors / beekeeper / shareholders.

• 1. Who are your beekeepers?
• 2. What are the groups that bring to bear the necessary resources for this to succeed, if you identified how it was to their benefit?
• 3. How is your project structured to provide a win-win-win to all parties?

Wash. Rinse. Repeat.

Before moving on to the Targeting Process to pull your ideas together into a coherent design, you may want to start back at the beginning and run through the FlowSpace brainstorming again. The early sections may spark different thoughts and questions now that you’ve thought through some other approaches for tackling the issues in your community. We hope that this process broadens the horizons of your perception of what is involved in building healthy flows in a community so that we can include the vital ingredients for your project’s success.

Intention:

We want you to be able to take the results of your FlowSpace brainstorming and focus it to ensure the success of your project. Some of the keys to success are to establish the relevance and credibility for it to be taken seriously. Another important factor is to keep the emphasis on the difference that it is making for your target community rather than roping people into conversations about currency theory.

1. Identify Your Community

It is tempting to think of a community in very general terms such as “people in Denver” or “Cultural Creatives.” This will set you up to have very abstract, theoretical conversations about “currencies” which generally won’t make sense to people or compel them to participate. Not everybody in a category or geographical region will participate, the trick is figuring out who the real participants and early adopters are.

• 1. How have you defined your community for this currency? Who are the key individuals groups that comprise it?
• 2. What worldview or perspective do they share that you will be able to appeal to? What language will you need to use to appeal to it?
• 3. What metaphors will capture the imagination of the people in this community and give them the means to communicate about this to each other?

2. Demonstrate Relevance

We tend to believe that people need to “understand” something in order to participate in it. However, very few people understand how the Internet works, but they still use email. Almost nobody understands how our current monetary system works, but they use it every day. The worst position to put yourself in, is one of explaining currencies to people in order to have them be able to understand why they’d want to join in. For example, try appealing to people in an affluent area like Marin County, California why they’d want to participate in a local currency by explaining the limitations of the existing monetary system and extolling the benefits of supporting local businesses even if they cost more. You would find yourself fighting an uphill battle, causing people to defend a monetary system you weren’t even trying to attack. (Ironically, this isn’t much different in an economically depressed area, since many of those people aspire to be wealthy. You’ll find them defending it just as strongly.) But tell people in Marin County that you’re creating a way that the community can help solve their traffic problem that rewards people for living near their work and shopping near their homes, and you’ll immediately have their attention and eager participation.

• 1. What compelling needs does your flow system address?
• 2. What well-known problems can your currency solve?
• 3. What long-time unmet goals does the community have that your system can help them achieve?

3. Establish Credibility

Currencies are fundamentally about belief and trust. People need to believe in the value of what the flow system rewards and trust the system to reward it fairly. If you can’t get people to believe in your system, it will never get off the ground.

• 1. What are the key organizations you could have endorse your project? Who are the highly trusted individuals whose participation or stamp of approval would lend credibility?
• 2. How can you “back” the currency with something of value to its members? Can you create ways of redeeming it for something they already know and trust?
• 3. Are there key organizations who would participate in your project? What are the local governments, corporations, foundations whose participation would automatically have people believe in your project’s stability or success?
• 4. What are the common needs which would have people easily believe in the currency’s “value?” (Like being able to buy groceries or pay their electric bill or mortgage.)

System Integrity & Design

Intention: Currencies with flawed system designs end up failing and having people lose faith in these kinds of solutions. It is important to ensure that a currency design is approachable, stable, easy to adopt and flexible enough to evolve with the needs of its community.

4. Usability / Accessibility / Facilitation

People are typically creatures of convenience. Anything that is difficult to use will have difficulties acquiring active participants. Currencies used for exchange should be as seamlessly integrated to the point of exchange as possible. Feedback and reputation currencies shouldn’t require more than a brief note and couple mouse clicks.

• 1. When will transactions take place? Where will people be at the time they need to transact? What are the easiest ways to facilitate those transactions?
• 2. What are the primary barriers to participation and frequent usage that you will need to overcome?
• 3. How can you surmount those barriers?
• 4. If you could wish for some magical thing to make the system work more easily, what would it be?

5. Participation Incentives

Beyond the good idea that might have people be willing to sign up, there should be visible rewards for their continued participation. These rewards can be, but do not need to be concrete. We have seen numerous people actively participate in an online community, just because of the positive feedback, acknowledgement and reputation it was providing.

• 1. What forms of positive feedback and acknowledgement are you providing to reward regular and active participation?
• 2. What are the specific types of participation you need from each segment of your community? How is each type being rewarded?
• 3. What tangible resources are available in your community which can be used as rewards?

6. Sustaining Value

To continue to keep people’s faith, a currency must be designed to maintain its value over time. When you create a new thing of value like a currency, it can be tempting to keep pumping more of it out into the community. This can cause a surplus of the currency relative to the demand in the community for it which may start a spiral of price inflation and currency devaluation. Even reputation currencies can become devalued and lose their meaning if given too freely. We can help you understand the strengths and weaknesses of various approaches to your system design to avoid these problems.

• 1. What are the ways can you measure the demand for your currency? How will you tell when your system is in balance or falling out of balance?
• 2. How will you retire, expire or reclaim your currency as more of it gets issued?