Currency Systems
Backed Currencies		Ithaca HOURS
LETS		National Currencies
ROCS		Time Dollars
Complementary Currencies

Backed Currencies, Scrip, and Barter

Benefits

How Issued

Benefits of backed currencies:

Backed currencies, which may be redeemed for a commodity or service, may be issued by whoever owns the product or service backing the money.

Backed currencies (depending on what's backing them and how well it holds its value) are usually less susceptible to inflation than fiat money, which is guaranteed only by the authority issuing and managing it and not by anything tangible.

How backed currencies are issued:

Backed currencies and scrip are issued by the owner of a product or service as some form of note guaranteeing the physical availability of the commodity (or service, more recently) which backs the currency. The holder of a backed currency can normally ask for delivery of the physical good or service in exchange for the currency.

How backed currencies are measured:: Backed currencies and scrip may be measured in relation to the product or service backing them--e.g. miles for airline scrip, ounces of metal, hours of service, or units of merchandise.

Exchanges in backed currencies are negotiable.: Backed currencies and scrip are private agreements, subject to whatever conditions the participants negotiate.

Structural incentives in backed currency systems:

Currencies that store value tend to encourage hoarding, and therefore competition. Demurrage, storage fees, and other mechanisms may be employed to outweight this incentive and encourage trade.

Backed currencies, depending on the durability and security of the goods or services backing them, are fairly immune to inflation.

Applications of the backed currency model:

E-gold, for a small fee, will store your precious metal(s) account in full and allow you to make micropayments to other accountholders, or redeem your e-metal for real metal (and vice-versa).
Monrobey Capital Management Network Corporation offers interest-free financing backed by real estate.
Several airlines, rental car agencies, and credit card companies offer some form of corporate scrip.
Eagle Barter Exchange facilitates business-to-business barter.
A directory of Trade & Barter Organizations

Related Resources

Also on the Transaction Net site:
- Pages devoted to other currency models (Time Dollars, Ithaca HOURS, national currency, LETS, and ROCS money); as well as general descriptions of how money works and how currencies can fill complementary roles in the economy.
- reviews of all available Payment Methods
- a glossary of money-related terms and concepts
- a directory of publications relating to complementary currency systems and how the Internet can facilitate them.
A Global Reference Currency in development would use a fixed basket of a dozen commodities as reference and backing, and would pass along the costs of storing those commodities to the bearer by means of a demurrage charge.
The Global Resource Bank issues money that measures the economic value of ecosystem production. Everyone owns a share in the Bank as a birthright. The Project is currently in Alpha.
The I-Barter site features a discussion list on enhancing business-to-business trade and barter.
Open Air Market Net monitors Farmers' markets and other open-air markets around the world.
Why Barter?
Community-Supported Agriculture
The International Reciprocal Trade Association

The Transaction Net site is an independent, open forum where anyone and everyone can explore new economic media, so if you know of another site that deserves attention, please let us know. You're also invited to register and join us over in The Money Conference.

The Money Conference

Join us in The Money Conference, where we're gathering to compare insights on all kinds of money systems--old, new, high- and low-tech, real or theoretical--and to synthesize from our shared experience wiser and more efficient models of exchange media. Sign up for Motet conferencing, then come on in and introduce yourself, or jump right to our conversations on barter, scrip, e-gold, or backed currency.