Arthur Brock explains why Holochain skips cryptocurrency entirely, instead proposing application-level currencies tied to real needs like energy and food. The first prototype, hosting power, would decentralize server infrastructure away from Amazon and Google by letting users earn credit for running the network.
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I have some very specific schemes and dreams about some of the early currencies to build on Holochain. Let me just clarify, Holochain does not have a built-in currency. Where most blockchains do, because they're so inefficient that they have to pay people to run them. Holochain doesn't suffer from that same inefficiency. We believe that if you want to run a Holochain application, the load that's being asked of you to carry is so small that you will carry it just to participate in that application in a space where you control your own data and, you know, are not the product to surveillance corporations, you know, surveillance capitalism. So the currencies that I want to build as to help us actually transition from how I look at it is from industrial age economies and financial infrastructure to information age economies and financial infrastructure are currencies that are backed by real human needs. So first of all, they have a kind of stability to them. Most of the cryptocurrencies that you see right now are highly speculative and highly volatile. They kind of go up and down all over the place. If you accept money for your business in it this week, it doesn't guarantee you can pay your rent with that money next week, 'cause it might've dropped 50% in value. And that's a very risky proposition to ask people to take on with that kind of instability in the money. So what we're looking at is currencies that are backed by real human needs like energy, food, housing, transportation, and actually the first one that we're working on is hosting power. Now hosting power may not sound like a real human need unless you realize that in the modern world, hosting is really a code word for communication and collaboration coordination on all scales because we carry these little devices around with us now, you know, that we coordinate and communicate with each other through digital applications that are hosted somewhere, right? And being able to have this kind of peer hosting network take away even the centralization of hosting from the big players like Amazon, Google, and Microsoft, you know, is a whole different framework for this, so that's a part of us taking back that power. But when we have these currencies that are backed by value, let's say, for example, let's use energy as an example. You have solar powers on your roof, solar panels on your roof. Now you can sell energy to the network as an energy producer provider, right? And that also lets you become an issuer of the currency based on your past provision of energy, you start getting a credit limit that you can borrow from, basically to have a negative balance to spend into the positive. And this is a different form of issuance. Many people don't realize that there's different ways that you can issue currency. There's fiat and backed and mutual credit, and all of the cryptocurrencies that are out there today are issued via fiat, meaning they're spoken into being, created by decree. Fiat, from the Latin, means to decree. Like the Latin Vulgate version of the Bible starts off with fiat lux, like let there be light. I speak light into being. That's God speaking light into being, right? There was no light, now there is. And that's the way that our national currencies work. There was no money and poof, now there is. The bank gets to speak it into being, and that's the way cryptocurrencies work. They just shuffle around who gets to speak it into being. Mm-hmm.
