IRTA Conference - Barter 3.0 transition
-
Upload
chrisjcook -
Category
Economy & Finance
-
view
373 -
download
3
description
Transcript of IRTA Conference - Barter 3.0 transition
![Page 1: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/1.jpg)
Barter 3.0
Back to the Future
Chris Cook
IRTA Convention Ocho Rios
14 September 2012
![Page 2: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/2.jpg)
Market 2.0 - Exchanges
Seller
$
Buyer'sBroker
Clearing House
$
Title Title
Seller'sBroker
Buyer
TitleTitle
![Page 3: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/3.jpg)
Financing and Funding Financing People-based creditShort/medium term, medium/high riskFinances circulation of goods & services and
creation of new productive assetsFundingAsset-based creditMedium/long term, medium/low riskFunds completed productive assets
![Page 4: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/4.jpg)
Banking 2.0 – Financing (eg trade credit)
Seller
$
BuyerBank
$
Value Value
![Page 5: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/5.jpg)
Banking 2.0 – Funding
Depositor
$
BorrowerBank
$
Value Value
![Page 6: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/6.jpg)
Banking 2.0 Accounting system – transactions (obligations) and
title (rights)Unit of account eg $Guarantee ('framework of trust') through pool of
capitalSettlement mechanism – payment systemRisk management/ platform provider/system
administration
![Page 7: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/7.jpg)
Barter 2.0
Seller
Trade Credit
Buyer
Operator
Value
TradeCredit
![Page 8: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/8.jpg)
Let's look back to Market 1.0
![Page 9: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/9.jpg)
Settlement 1.0
Merchant A Seller B
Seller C
Seller D
Seller E
IOU
IOU
IOU IOU
IOU
![Page 10: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/10.jpg)
Guarantee 1.0 – Risk Pooling eg Tontines
Member Member
PoolGuaranteeGuarantee
Value Value
Member
Member
Member
![Page 11: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/11.jpg)
Credit 1.0 - Stock
![Page 12: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/12.jpg)
Market 1.0 never went away..... Settlement 1.0Brent/BFOE forward market in North Sea Oil Web applications – Ripple and Circular Multilateral
BarterGuarantee 1.0P & I Clubs have mutually insured big risks (eg
shipping) for 150 years; for 135 years the same broker
Stock 1.0reinvented by Enron (who else?) as 'Prepay' and
used to defraud investors and creditorsbeing used by oil producers eg Saudis to support
price and manipulate the oil market
![Page 13: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/13.jpg)
NewClear - Seller accepts Buyer's IOU
Seller Buyer
IOU
Value
![Page 14: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/14.jpg)
IOU is registered with Transaction Registry
Seller Buyer
IOU
Value
Registry
DataData
![Page 15: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/15.jpg)
NewClear – Transaction Registry Database held by a custodian of all open bilateral
'peer to peer' credit obligationsPositions held gross but the risk may be net: eg +
$8000 and - $6000 gives a net position of +$2000Only members may use the registryUse of registry is subject to NewClear 'club rules'
and standardsRegulatory sanction of suspension or termination
of membership and hence registration Registry maintained and operated by Manager
![Page 16: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/16.jpg)
IOU is guaranteed by Clearing Union of Sellers & Buyers collectively
Seller Buyer
IOU
Value
Pool
GuaranteeGuarantee
![Page 17: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/17.jpg)
Seller & Buyer pay guarantee charge into Pool held by Custodian
Seller Buyer
IOU
Value
Pool GuaranteeGuarantee
Fee Fee
![Page 18: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/18.jpg)
Settlement 1/ - Buyer settles open credits in money or 'money's worth' eg energy stock
Seller Buyer
Value
Pool GuaranteeGuarantee
Fee Fee
![Page 19: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/19.jpg)
Settlement 2/- System identifies a 'chain' of IOUs A<B<C<D<E<A and 'nets' them out
Seller A Seller B
PoolGuaranteeGuarantee
Fee Fee
Seller C
Seller D
Seller E
IOU
IOU
IOU IOU
IOU
![Page 20: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/20.jpg)
Settlement 3/ - Buyer defaults: system pays sellers and collects from buyer if possible
Seller A BuyerDefault
Pool
Collects
Pays
Seller B
Default
Pays
![Page 21: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/21.jpg)
Service provider sets guarantee limits, handles defaults & manages system
Seller Buyer
IOU
Value
Pool GuaranteeGuarantee
Fee Fee
ServiceProvider
FeeService
![Page 22: IRTA Conference - Barter 3.0 transition](https://reader033.fdocuments.us/reader033/viewer/2022061213/5497211bb479594e5a8b45e0/html5/thumbnails/22.jpg)
Outcome – the community is the currency Communities have a 'common bond' eg
geographical or functionalCommunity-based credit provided 'at cost' with
shared operating and default costsService provider's interests are aligned with
system users No 'interest' (money for the use of money) means
system will out-compete conventional 'for profit' credit
Sharing of risk and rewardB2B credit may be extended to B2C