The future of money

Facebook Credits becoming more important than the dollar? Not any time soon – but there are some thought-provoking elements in this discussion about the future of money (by Ross Dawson and Gerd Leonhard). Recently Ben Bernanke got the question whether gold is money. The answer was ‘no’. But maybe we’ll have to ask him whether Facebook Credits, Bitcoins or Linden dollars are money.

Gerd Leonhard reacted on Google+ that what he said about the dollar vs. Facebook Credits was meant more as a provocation than as serious prediction.

Previously we posted about similar ideas being presented by Sean Park: ‘The Sixth Paradigm

In the comments on my Google+ entry there’s also a discussion about what Linden Lab says regarding the Linden dollar (the famous ‘You acknowledge that Linden dollars are not real currency or any type of financial instrument and are not redeemable for any sum of money from Linden Lab at any time.’).

The Sixth Paradigm

Are you interested in the proliferation of markets everywhere (think not only the major financial markets but also Facebook, iTunes, Second Life… )? What about cloud computing and concepts such as Everything as a Service? And finally the digitization which transforms so many industries and activities? Now let’s tie those three big trends together and you’ll end up with the Sixth Paradigm of Sean Park.

I attended Park’s workshop about Reinventing Financial Services at the LIFT conference in Geneva, Switzerland, but don’t run away now thinking that “it’s about finance, so it must be utterly boring.” In fact, Park’s thinking about financial services is embedded in a more general philosophy about change in the economy and society, and about the clashes between those changes and culture in big and small companies.

Park is heavily inspired by the work of the economist Carlota Perez who wrote the book Technological revolutions and financial capital (2003). In this video Perez explains five technological revolutions and the new paradigm or common sense they brought along in each case:

This is a trailer video about the possible application of those ideas for the financial services:

You can find Park’s presentation of this re-invention of financial services on his blog.

A fictional narrative written in 2005 by Park explores the future of financial services and markets from the vantage point of December 2015 looking back on the changes that occurred over the past decade. Not to be interpreted literally, the goal was to foster discussion and debate on how powerful secular trends in technology, economics and demography might act to shape a new landscape in how markets operate and financial services are delivered in the future.

Pretty fascinating stuff. You can follow Park on his blog The Park Paradigm and of course on Twitter.