Business TEDTalks

10 alternative currencies, from Bitcoin to BerkShares to sweat to laundry detergent

Posted by: Jessica Gross
Paul Kemp-Robertson talks about how non-government currencies are gaining consumer trust at TEDGlobal 2012. Photo: Bret Hartman

Paul Kemp-Robertson talks about how non-government currencies are gaining consumer trust at TEDGlobal 2013. Photo: Bret Hartman

“Is there a reason for governments to be in charge of money?” asks Paul Kemp-Robertson in today’s talk. Judging by the new raft of alternative currencies—from digital coins to point systems that reward customers of a certain brand—the answer might someday be “no.” Again.

Paul Kemp-Robertson: Bitcoin. Sweat. Tide. Meet the future of branded currency.Paul Kemp-Robertson: Bitcoin. Sweat. Tide. Meet the future of branded currency.As Kemp-Robertson suggests, many people seem to trust brands more than governments these days. Since currency is, in a sense, an expression of the brand value of a government, why shouldn’t commercial brands also make currency?

Kemp-Robertson reminds us that, once, they did. As an example, before the US Civil War, 1,600 different corporations, mainly private banks, issued paper banknotes. The government only issued coins, a mere 4 percent of American currency. The Civil War upended that system (read more) and eventually led to the creation of a single currency issued by the Federal Reserve System.

Here, learn more about 10 kinds of alternative currency in use today, from Kemp-Robertson’s talk and beyond.

  1. Bitcoin. The world’s best-performing currency, according to Kemp-Robertson, Bitcoin’s value is tied to the performance of a computer network. It’s “completely decentralized—that’s the sort of scary thing about this—which is why it’s so popular,” Kemp-Robertson says. “It’s private, it’s anonymous, it’s fast, and it’s cheap.” Bitcoin is a case study in the increasing desire to place trust in technology over traditional institutions like banks.
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  2. Litecoins. A virtual currency based on the Bitcoin model, Litecoins have a higher limit: “The number of coins that can be mined is capped at 21 million Bitcoins and 84 million Litecoins,” explained a recent Wall Street Journal post, which also noted that Bitcoins are worth more and currently accepted more widely.
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  3. BerkShares. While Bitcoin and Litecoins are worldwide currencies, BerkShares are hyper-local: they’re only accepted in the Berkshires, a region in western Massachusetts. According to the BerkShares website, more than 400 Berkshires businesses accept the currency, and 13 banks serve as exchange stations. “The currency distinguishes the local businesses that accept the currency from those that do not, building stronger relationships and greater affinity between the business community and the citizens,” the site reads.
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  4. Equal Dollars. Philadelphia is also trying out a local currency with Equal Dollars. When you sign up to participate, you receive 50 Equal Dollars; to earn more, you can offer your own possessions in an online marketplace, volunteer or refer friends.
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  5. Ithaca Hours. Another hyperlocal currency, Ithaca Hours—usable only in Ithaca, New York—also hopes to boost “local economic strength and community self-reliance in ways which will support economic and social justice, ecology, community participation and human aspirations.” (For a full list of local currencies in the US, go here.)
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  6. Starbucks Stars. Use of Starbucks’ Stars is limited not to a particular geographic locality, but to the corporate ecosystem that is Starbucks. Once you get a Starbucks Card, you can earn Stars—which buy drinks and food—by paying with the card, using the Starbucks app, or entering Star codes from various grocery store products. According to Kemp-Robertson, 30 percent of transactions at Starbucks are made using Stars.
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  7. Amazon Coins. Another company-specific currency, Amazon Coins, can be exchanged for “Kindle Fire apps, games, or in-app items.” You get 500 Amazon Coins, worth $5, by purchasing a Kindle Fire, or can buy more Coins at a slight savings.
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  8. Sweat. Kemp-Robertson points to a particularly innovative business-specific currency in Nike’s “bid your sweat” campaign in Mexico. Your movements, energy, and calorie consumption are tracked and can be exchanged for goods, ensuring a “closed environment”—only people who (a) own and (b) use their Nike products are welcome.
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  9. Tide detergent. This is a barter system that’s about as far from government-backed as you could get: in 2011, it was discovered that across the US, thieves had been stealing 150-ounce bottles of Tide detergent to trade for $5 cash or $10 worth of weed or crack cocaine. An article in New York Magazine from earlier this year details the fascinating story and what it says about Tide’s super-successful branding.
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  10. Linden Dollars. Linden Dollars, usable within the online community Second Life, can be bought with traditional currency or earned by selling goods or offering services to other Second Life residents. Many people earn actual Linden salaries—some to the tune of a million Linden Dollars—says this article from Entrepreneur.com.
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  11. BONUS: Brownie Points. Granted by the universe as a reward for good deeds. Not exchangeable for tangible goods, just self-satisfaction, which we think is also important.

Comments (20)

  • Darren Couillard commented on Jan 14 2014

    Only for those into Bitcoins and that currently have some to reinvest in to mining power check out https://cex.io/r/1/Pinchloaf/0/ Cloud mining, Use your BTC to by hashing power in seconds, and sell it when you dont need/want it any more and get you BTC back. Just trying to get more and keep people involved in BTC. I use some of my Bitcoin to buy Gold and silver, Diversify ;-)

  • Andrew Brown commented on Dec 29 2013

    What is needed is “glue” to translate one currency to another. All currencies share a common problem: are they a form of wealth storage or are they a transactional medium? By creating a common protocol, the currency can finally become one, either, or both.

    Promise Language solves this: http://promiselanguage.blogspot.com It is a free transactional protocol that works with ANY currency (or barter).

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  • commented on Jul 30 2013

    Bitcoins? Whether you want it or not by you reading this post means you could be one of the first to make a lot of money on the people that come after you! The Bitcoin Robot is a unique concept that has very little to do with trading in the conventional way! It is based entirely on the “Human Greed” factor. Making You earn while 90% of the people that run towards bitcoin pay too much to own bitcoins while filling your pockets in the process!

    Go get the full scoop here: http://ezhomefunds.com/btcsm

  • Glenn Diecedue commented on Jul 29 2013

    A Bitcoin is a very new “currency” that allows people to profit without ANY fees of transfer, any freezing of funds, doesn’t require banks and is currently feared by the established financial institutions to the way of trying to ban it but the fun thing is it`s impossible to ban or prohibit because no one owns it!

    There is a free presentation seat to be grabbed so you can be the first to learn more about a brand new bitcoin robot that is due to be released very soon to a small circle of people that follow its development. This was created by a group of clever developers are working on this tool that will allow people to make bitcoins every single day! This is unlike anything you have ever seen or heard off and it makes perfect sense that early birds knowing this info will make a lot of money off the backs of people that come into a new moneymaking market too late.

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  • commented on Jul 27 2013

    Reblogged this on GURU PRASAD.

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  • Alice MAGGIO commented on Jul 26 2013

    Hi Jessica, could you please change the link for the “full list of local currencies in the US”? The website of Schumacher Center for a New Economics now houses this directory. You’ll find updated information there. Here is the correct link: http://centerforneweconomics.org/content/active-local-currencies

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  • Jamie Klinger commented on Jul 26 2013

    What about an evaluative system of money regulated by the population who uses it? Why can’t the people who accept the currency decide what is ‘valuable’ and create the currency when people do things that others consider valuable?

    This is what I’m building and I urge you to have a look, it’s called JOATU and stands for the Jack of All Trade Unit. A detailed photo-walk-through are on the site.

  • commented on Jul 26 2013

    As an idealist I love this, but the overwelming challenge is how to restrict organised crime. Even taking into account the high levels of corruption associated with government intervention we’re already seeing how unregulated monetary systems are easily manipulated and utilised for crime, particularly in the drugs and arms trades.

    I definitely think localised systems of exchange can work well, but things like Bitcoin are now becoming safest way for criminal sydicates to buy, sell and move vast sums of money undetected.

  • john ioannis divramis commented on Jul 25 2013

    Daer Jessica, l regret to tell you that artificial money and alternative coins are useless as soon as the only thing they manage to do is to overwhelm the economy and frustrated the final customer without adding real value. l can’t believe why people are dealing with garbage and nonsense and do not focus on real economy…

  • Lisa Chesser commented on Jul 25 2013

    It’s kind of like we’re buying into the video game mentality of buying coins. I really hadn’t thought of Starbucks Stars as currency but when connected to the other forms of currency, it really is. And, Brownie Points, yes, everybody uses that and understands their infinite value.