Making banks obsolete

Competing with them for market share. But at what market share will we be happy, and want to stop? I suggest we won't, so ultimately, replace.

But what we say depends on who we're talking to.
As i said via email:
Yes, it's a tricky path we have to walk.
OCN: we want to make banks obsolete. Potential investors: hmmm, nutters.
OCN: we want to reach 1% of the economy. Early adopters: yawn.
But one thing's for sure, the economy has to change completely, not just a tiny percentage, or there won't be an economy at all in a couple of generations (probably less). Banks are the core of the problem.

We've seen how damned hard Sardex have worked to build a business which isn't yet financially viable, and which still owes a lot to venture capitalists. And we know how the whole sector struggles to be honest, scalable and viable. The regulatory and business environment makes it very difficult to do what we are doing.
Personally I'm not excited at the prospect of replicating the limited success of Sardex, which Guiseppe suggests will be capped in principle at 5% of the economy. Climate change will soon disrupt EVERYTHING. My view of what we are doing is creating an alternative financial system to expose and replace the crumbling system which is still dominant. We are not competing with banks. We are one of the young trees in the rainforest which remains small until an old tree falls and leaves a hole in the canopy.
The stakes are as large as they come - mass extinction, including possibly our own. If we don't achieve massive success we won't achieve anything at all. The odds may be slim, but we are taking it upon ourselves to cover this base.
Its not my wish to spend energy struggling to grow in a hostile environment. I would rather focus on providing scalable infrastructure and preaching about it, so everybody knows where to go when the environment changes.
If Dil and Oli want to make a viable business in the medium and long term - that's not incompatible, but I think it helps us to know where our passions lie.
So to reiterate. I don''t want to compete with anybody, especially not banks. I want to build an alternative financial system which will bloom the next time the financial system implodes.

Well stated, Matt.
As I see it, our job is to refine the design and management protocols of credit clearing, test them in the market at whatever scale we can, and have something ready to be implemented and replicated as conditions change. As the dinosaurs die off, niches will open up for cooperative, decentralized, mutual credit clearing exchanges to begin the thrive. We also need to have plans and structures for quickly networking these exchanges together.
There are a multitude of factors that make all future projections mere speculation, but we must be ready. :slight_smile:

Yes, definitely, and love the rainforest tree analogy. But on the other hand, Dil and Oli are right that we're going to need investment (but Dil's kind of 'ratcheted' investment, rather than anything that confers control) / funding for this, and if a more radical approach will repel them, then I'm happy to just talk in business terms, for now at least. (however, we do still have to replace this cancerous system, and so this would only be a tactical approach). Can we advertise investment opportunities at the same time as economy-replacing opportunities, but to different audiences?

If we are honest with investors, we can't promise to do any better than Sardex have done. An honest pitch would aim for high risk, high reward investors. Aligned investors would be those who are worried about preserving their wealth through the next financial collapse.
We don't want loans, we don't want venture capital, which would tell us how to behave in order to get to the next 'round', but something perhaps more like equity, which gains in purchasing power as we succeed, but also allows us to fail without bankrupting ourselves.

Thinking about it, yes, I think that maybe one message is enough to get investors as well – to stress that this is the future, and returns will begin to diminish and eventually disappear in the extractive sector.
And the debate about whether we’re challenging or replacing banks is a bit academic. Let’s just get going and see what we can do. The only reason we’d stop growing is if we couldn’t grow any more, surely? We’re not going to suddenly decide that we’ve got enough market share and we’re going to stop trying to get more?

I don't see it as either compete or replace: I see it as both/and or neither/nor. I think that within associative ('Club') risk, cost, surplus & data sharing agreements it is possible for banks to operate as platform service providers, managing risk, introducing investors to investments and otherwise providing value-added banking services. What I said in Volos 5 years ago is still pretty much to the point, I think, and potentially describes the backbone of reality-based financial technology.

https://www.youtube.com/watch?v=zl8_tCa7AtA&t=2719s

Thanks Chris, I think that is spot on. We are providing an innovative (disruptive) solution for the value exchange function. As Clayton Christensen describes, as our approach is improved and presented, it will move "up market" to gradually displace the "old technology," but that does not mean that aspects of the existing infrastructure cannot be incorporated in the new approach.