Collaborative finance

When we turn to the digital economy and cryptographically enabled decentralized economic systems, the state cannot be invoked as the deus ex machina of economic conflicts. There can be no reliance on the state to ‘balance’ the interests of creditors and industry and merchants. But there is a further, more critical, burden that falls to finance in the absence of a role of the state: how to link the present to the future; how to give intertemporal coherence, and the sense that the circuits (or loops) of capital are reproducible over time. This requires techniques to make the future imaginable, tangible and in some sense negotiable. This is the deepest (and broadest) sense in which finance must be collaborative. In a capitalist economy, the state’s monetary, fiscal and industry policies – and not just in their technical mechanisms of economic management, but also in collective the cultural belief in the integrity of those policy institutions – link tightly the present to the future. More than verified success, the system relies on a popular trust that the state knows what it is doing and will get it right or right enough. Mounting evidence of states not getting it right builds political vulnerability – a space cryptoeconomics seeks to build on. Without this role of the state, and a propensity for financial disintermediation, cryptonetworks must build explicit different social mechanisms of collaboration to link the present to the future. The ECSA take on collaborative finance is based on this insight. For more see Dick Bryan (2023): The ECSA Take on Collaborative Finance.