For a Sustainable and Fair Economy
We live in a world where many things seem to be going wrong. Growing social inequality, climate change, loss of biodiversity… just to name a few. Are you one of those people thinking that change is needed, however nothing ever happens? Then maybe this project is for you.
Most of the problems of human society have to do with economics. This is why the Viridian Project aims for an alternative way of economic activity. Imagine an economy that takes into account not only economical, but also environmental and social concerns. An economy where people are worth more than profits. An economy, in which sustainable and fair are the default, not the exception.
The main goal of the Viridian Project is to internalize external costs using a new digital currency, making social and environmental concerns a normal part of every business model.
The objective is to create a computer network for the collaborative sustainability assessment of products and brands. This will enable to include external costs in prices. The network shall provide the following benefits:
The network shall be decentralized for increased resilience.
There should not be any single points of failure. It must also be spread to prevent too much concentration of power. The network shall be operated by and in the hands of all people, not of few (or single) corporations or governments.
Thanks to decentralization and transparency, economy and society become more democratic and more equal.
Running the network on many decentralized nodes, the concentration of resources and power can be prevented. Decentralized systems like e.g. blockchains enable to move power away from centralized systems (like banks and corporations) and towards the people using the infrastructure. In addition, the rules of the network, more specifically the assessment of products and companies, shall be set by the users: in an open, collaborative process, similar to the development of open source software. The use of computer networks allows the usage of innovative democratic consensus tools like liquid democracy.
Transparent prices, including external costs, incentivize sustainable and socially responsible business.
Sustainable and socially responsible business and commerce are incentivized by including external costs of economic activity in the prices. If a company generates high external costs that is does not take care to prevent or mitigate, it often receives an unfair competitive advantage. But the costs still arise, for us all (often the taxpayer). They are socialized. If prices include external costs from the outset, companies gain a competitive advantage if they reduce them instead of socializing costs more and more. Socially meaningful solutions are automatically preferred.
In addition, for sustainability reasons, it is important that the blockchain transactions are not verified in a resource-intensive proof-of-work process, but in an alternative way with an ecological footprint as small as possible.
The Viridian market will be fairer and closer to an idealized free market.
If external costs are included in the price calculation, the market is fairer and is approaching an idealized free market. On such a market, all market participants are perfectly informed. The resulting prices reflect the costs incurred to society through production. In other words, everyone affected by the production will receive adequate compensation. Because if someone is not compensated appropriately, they can simply go elsewhere on a free market. In case of external costs that does not work. The market is imperfect and Viridian closes this gap a bit.
Also, because the supply chain can be revealed in the process, inferior quality can be revealed as well. Customers do not have to trust the reputation of a producer, but can choose the best option available. This makes it easier for newcomers to sell their better products. Especially if external costs are reduced. This accelerates the introduction of alternative technologies, thereby increasing innovation and reducing market monopolies.
Problems in the supply chain shall be revealed. In addition to the assessment of a product or company, it shall be visible why this assessment is this way.
The assessment process and algorithm must be as transparent as possible. Changes to an assessment or the algorithm must be accompanied by legitimizing information or verifiable sources. Public data shall be made open to everyone. Because of its importance for society, information on the external costs of any economic activity must be public and cannot be kept a company secret. Because people are more important than profits, there cannot be such “investor protection”.
The network shall be end-to-end encrypted to provide security and privacy.
People should have full control over their data. Private data shall be kept private, instead of being a commodity, which is harvested for profit.
The initial conception phase is slowly coming to an end, the vision becomes more and more concrete and we start with the implementation (see Timeline). Nevertheless, there are still many open questions and unsolved problems. That’s why we are always looking for like-minded people to discuss and exchange ideas. Especially the topics from the tiles under Open questions still need discussion.
Here is the list of the various topics and their open questions. If you can help us with something, please contact us.
Distributed Ledger Technology
Which solution to choose?
Bitcoin, Litecoin, Ethereum, IOTA, blockchain, DAG, smart contracts, DAOs, proof-of-work, proof-of-stake, … — the world of distributed ledgers and cryptocurrencies is full of innovative ideas, with new ones springing up monthly.
If you are enthusiastic about all things crypto, then you might be able to help us decide, which solution is best suitable for the Viridian project.
We want transaction validation to have an as small resource footprint as possible. The incentive system must be designed such that there is no motivation for running a lot of computing power, however there must be motivation to contribute to the network in the long term. Of course, the system shall be as decentralized and trustless as possible to keep it secure and scalable.
Please note: In the meantime we settled to use Hyperledger Fabric, a permissioned blockchain, as a manipulation-resistant decentralized database backend. It does not provide as much decentralization and trustlessness as proof-of-work blockchains like Ethereum, but we believe it to be a good compromise between resilience and efficiency. See the technical paper for more details.
If you think you can help, contact us at or join the Viridian group at the Coinsence community platform.
Good design is the key
The Viridian project’s concept relies heavily on the use of computer technology and software. All this software still has to be built, both on the backend side and on the frontend/UI/UX side.
A clear vision and good design choices are crucial for an infrastructure that is secure and maintainable and that scales well.
One should build upon existing work wherever possible. Especially when it comes to cryptography, there is a good rule of thumb that one should not “come up with a home-brew solution”. Therefore, a first step would be, together with creating the vision, to carefully evaluate which components could be based on what, and how these components must be able to interact with each other, keeping in mind maintainability, security and scalability.
Once these general points are sorted out and the roadmap is clear, one can set up the requirements for the various components and can start implementing them.
A slick UI/UX will also be a crucial part of attracting users.
Please note: In the meantime we settled to use Hyperledger Fabric, an open source blockchain framework maintained by the Linux Foundation. The JSON-based distibuted database CouchDB will be used as the backend of Fabric to store the data. Therefore, on the backend side, we are mostly set and will use the infrastructure and crpytography provided by Hyperledger Fabric. On the frontend side, we currently plan to develop a Progressive Web App (PWA), but might also look into Flutter or Cordova. See the technical paper for more details.
If you think you can help, contact us at or join the Viridian group at the Coinsence community platform.
Currencies and monetary policy
What are the rules of a good currency?
In traditional fiat currencies, a central bank is in charge of controlling the currency, e.g. by regulating the amount of money in circulation, or in fact by setting the key interest rate.
In a decentralized cryptocurrency, there is no central bank, which is a good thing because it prevents corruption and dependency on centralized entities. Instead, the network’s mathematical algorithms take over the role of a central bank.
An important question is: How to design these algorithmic rules? For instance, what is the optimal supply of fresh money? Shall there be a fixed amount of money? Or shall the amount of money increase (causing inflation) or decrease? Shall there be a demurrage imposed on the currency, constantly devaluating it over time?
What role will the financial system play?
In the Viridian economy, will banks still be important players? Private banks currently create almost all the money that enters the economy. With a decentralized cryptocurrency as dominant payment medium, this would not be the case anymore.
So, how shall banks be treated in the Viridian economy? Will banks’ services also have associated “colors”? Will banks be superseded by innovative new concepts, e.g. peer-to-peer credit systems with risk scattering by spreading investment money on many agents?
What to do with interest rates on investments? Shall there still be interest rates? Or are interest rates not acceptable anymore since they are drivers of limitless growth in a world with limited resources?
If you think you can help, contact us at or join the Viridian group at the Coinsence community platform.
Would the Viridian economy be closer to an “ideal” free market?
The concept of free market economy goes back to the influential economists Adam Smith and David Ricardo. Smith introduced the idea that a free market results in fair conditions for all participants. Ricardo formalized and abstracted Smith’s ideas and had to simplify it a lot. This resulted in a well working theory, but many people also started to neglect the limitations of the model and the fact that it does not necessarily represent reality.
Adam Smith was very aware of the limitations of his concept and warned about them. For instance, a market with few corporations is a bad idea because the corporations can choose to require higher prices than they need to. It becomes even worse when big business and government make each other gifts, abusing their power, leading to high profits for few capitalist leaders and corrupt politics. This is why Smith was a fierce opponent of corporations and preferred an economy with many small competitors (like most of economy still was at Smith’s time, which changed over the course of the 19th century).
The Viridian economy, with its decentralized power and easily adjustable rules, might help to prevent such situations and create a market that is closer to Smith’s ideal.
Another flaw of our present-day capitalist economy is the exclusion of external costs. Many economists argue that this leads to a distortion of the free market. In Smith’s ideal free market, all prices reflect the actual cost that a product’s production imposes on society. For example, if a worker needs to spend more time on one product than on another, then it must cost more to reflect this. If the production leads to external costs that society (ultimately everyone, including the buyer and the seller) must pay for, then the product should also cost more, to pay for these costs and also to regulate the demand for the product.
Again, the Viridian project might help to remove this flaw from the economy.
What do you think about it? If you have any opposing views or ideas how the Viridian project can improve our market economy even more, feel free to contact us at or join the Viridian group at the Coinsence community platform.
What are the likely concerns and needs of businesses?
The Viridian project would necessarily interfere with the way people are doing business. For example, “color” must be considered when determining retail prices.
From the business perspective, what would the main concerns and objections be that might disturb the adoption of Viridian? How could these concerns be addressed? What are the possibilities to make a transition easier for businesses? Can we provide services that would simplify a business’s life?
How to attract businesses?
How can we create business models that would make the adoption of Viridian lucrative for businesses, e.g. through improved image or intensified customer relations?
How to attract consumers?
There should be benefits for consumers as well. If the system’s cumbersome to use and most products cost more, no-one will use it except some idealists.
What are the legal implications of creating an alternative currency?
What are the legal risks? Are there any subtle differences in the handling of the alternative currency that would influence if it’s deemed legal or illegal?
Transparency vs. secrecy
Are there any laws protecting company secrets that would conflict with an open and transparent economy like in the Viridian project?
Of course, one cannot force companies to reveal information unless one changes the law, in which case the conflict would be removed. But in an ideal world, one would manage to encourage companies to reveal information voluntarily until everyone is doing it and it becomes normal practice.
But still, are there any legal obstacles to the whole process?
Any other law problems we didn’t think about?
Law can be very unintuitive and incomprehensible for laymen. Maybe there is an obvious legal obstacle that did not occur to us yet?
Life-cycle analysis, external costs, sustainability
How can the Viridian project benefit from existing LCA work?
Life-cycle analysis (LCA) is the assessment of environmental impacts associated with the entire lifetime of a product, from the extraction of raw materials, via production and use, to its disposal and recycling.
Databases and dedicated software products for LCA already exist and are regularly updated by researchers. These would provide a solid base for the determination of many products’ “colors”.
A problem is that existing LCA products like ecoinvent are usually not freely available and open sourced. Unless there are APIs allowing to interact with them, it will be rather complicated to use those third party software products. A very welcome open source software project is openLCA, which solves some of these problems. However, another problem is licensation, which might even prohibit the use of the data for such purposes as the Viridian project.
The problem of course is that LCA is a very labor-intensive task and the researchers doing it must use licensation to ensure that they earn a living. In the Viridian economy, LCA researchers would turn into “color miners” that are paid fair rewards for their services, but only if they open up all their data. Therefore, they would be in a much different (and much more important and powerful) position than they are now. The question is: how to organize the transition from here to there?
Are there better ways to assess external costs?
Apart from LCA, can you think of alternative ways to determine external costs that are easier to use?
Are there any other tools in the sustainability and external costs scene that would be really useful for the Viridian project?
If you are an LCA/external costs/sustainability expert and think you can help, contact us at or join the Viridian group at the Coinsence community platform.
Auditing, e.g. organic or fair trade
Any learned lessons from auditing practice?
Already existing sustainability certifications of products (fair trade, organic standards, etc.) usually involve audits, i.e. systematic and unscheduled visits to producers to check if the required standards are met and that there is no abuse of the certificate label.
Do these kind of audits need to be a part of the “color” determination? How can they be organized as efficient and corruption-safe as possible? Are there any mistakes that can be avoided? Any thoughts on how to scale audits up in a good way? Or do you think audits are actually a bad thing and there are better alternatives, e.g. using social networks and personal contacts to people?
If you have experience from the auditing business and think you can help, please contact us at or join the Viridian group at the Coinsence community platform.
Psychology and Sociology
The rational brain and the emotional brain?
Economic decisions seem to be driven mostly by rational thinking and self-interest in the lines of “cheaper is better” and “more is better”. Negative effects on others or the environment are usually not considered when people buy things, or (to a lesser degree) even when they look for an employer.
But people are not just rational, but also social and emotional beings. The hypothesis is that while conventional money stimulates mainly the rational part of the brain, there could also be a component of money that stimulates the emotional part. With the emotional component putting an emphasis on empathy and ethics, the perception and use of money could become much more balanced and less one-dimensional and mechanistic than it is now. The “color” dimension of the Viridian money could provide this extra mechanism.
Does this hypothesis have a sound foundation in psychology or is there a contradiction with psychological research?
How to use psychology to make Viridian attractive?
Capitalist advertising makes use of all kinds of psychological tricks to entice people and encourage them to change their behavior (mostly to buy stuff they don’t really need).
What kind of psychological tricks could be used to convince people to use the ethical Viridian money? Could peer-pressure be used in a positive way to attract new users? Maybe in the lines of “Three of your friends already use Viridian, when do you come and join us?”
What about socio-economic aspects?
The socio-economic situation of the people is important because it ultimately decides about what people perceive as “good” and “fair” and what they accept and support. If there is a perceived threat to peoples’ lifestyle, there will be opposition.
Environmental action and climate action is often put on the shoulders of the weakest. For example, when stricter regulations lead to higher prices, it is the poor that suffer most from it, while the rich might not even feel a difference. Therefore, it is very important to implement sustainable development in a way that improves the socio-economic status of the vast majority of people and especially the poorest. The rich are the biggest polluters, so they are also the ones that should pay for the transition towards a safe world.
How can we design Viridian so that the improvement of the socio-economic status of most people is guaranteed, while the economy gets more sustainable at the same time?
Do you have any thoughts, ideas, comments, suggestions, improvements? Contact us at or join the Viridian group at the Coinsence community platform.
Politics: Democracy and Voting
How to organize ourselves?
Politics is all about power and who gets to decide what. Conventional political systems use centralized structures for political decision making. Computer technology may enable us to use better alternatives.
In the Viridian project, we want more decentralized and bottom-up decision making to minimize corruption and increase societal acceptance. But because direct democracy can be very inefficient or prone to demagogical manipulation, a middle way between direct and representative democracy might prove very useful. Delegative democracy, also called liquid democracy, is a process, in which political decisions are not delegated completely to just one representative, but each voter can decide by topic whom to delegate questions to. Or, if the voter feels competent in the subject matter, she can choose to answer the question herself.
Direct democracy has the general problem that it does not scale well. It works well in small groups, so that cooperatives, for instance, can be operated very efficiently. But a whole society, operated like a cooperative, is difficult to achieve. Liquid democracy might combine the best of both worlds: The direct involvement of direct democracy and the stability and efficiency of representative democracy. Liquid democracy involves a lot of communication between people, making use of social networks. That means, it can profit heavily from the use of information technology, without which it might be too cumbersome and slow and therefore inefficient.
If you have any other ideas on how decisions in the Viridian project might become more democratic and legitimate, or if you have experience with liquid democracy or similar tools, contact us at or join the Viridian group at the Coinsence community platform.
How is this any different from what already exists?
There are already many good concepts for a sustainable economy. See how they compare to the Viridian project.
Existing ideas for a more sustainable economy include:
- Transition Towns and Permaculture (see also: here)
- Cradle to cradle (see also: here)
- Ecological economics (see also: here)
- Sustainable Economics
- Gemeinwohlökonomie (German)
- Öko-Bilanzierung (German) (“Richtig rechnen!”)
- Bioökonomie (German)
Look at this comparison to see the pros and cons of selected existing intiatives and what they lack compared to Viridian.