ucos:use-credit_obligations

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-Store of value: we’ve been promoting the idea of [mutual credit](/mucr/mutual_credit) as a means of exchange for a few years, explaining that if the exchange and store-of-value functions of money aren’t separated, the means of exchange will be extracted from communities and concentrated. If mutual credit is the means of exchange, use-credit obligations are used to save / store value.+_Store of value: we’ve been promoting the idea of [mutual credit](/mucr/mutual_credit) as a means of exchange for a few years, explaining that if the exchange and store-of-value functions of money aren’t separated, the means of exchange will be extracted from communities and concentrated. If mutual credit is the means of exchange, use-credit obligations are used to save / store value._
  
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-The market currencies that Paul Grignon talked about in ‘[Money as Debt](https://www.youtube.com/watch?v=2nBPN-MKefA)’ were really UCOs – that were eventually banned by the state.+_The market currencies that Paul Grignon talked about in ‘[Money as Debt](https://www.youtube.com/watch?v=2nBPN-MKefA)’ were really UCOs – that were eventually banned by the state._
  
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-Chris Cook came up with 2 inventions to reduce the risks of investing in UCOs, and to avoid regulatory capture (below). He explains more [here](http://lowimpactorg.onyx-sites.io/posts/storing-value-in-a-mutual-credit-world-chris-cook).+_Chris Cook came up with 2 inventions to reduce the risks of investing in UCOs, and to avoid regulatory capture (below). He explains more [here](http://lowimpactorg.onyx-sites.io/posts/storing-value-in-a-mutual-credit-world-chris-cook)._
  
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 +### Avoiding 'regulatory capture'
  
-### Avoiding ‘[regulatory capture](https://www.youtube.com/watch?v=udoqK5AfYpw)’ +Another important Chris Cook invention was to make UCOs assignable, not transferable. To explain: a £10 note is transferable. Anyone who gets it can spend it, and it doesn’t matter where they got it from. They might have found it, or got it from someone who stole it – but they can still spend it. No-one will question where they got it. Transferable is clean and anonymous. That’s not the same for a cheque, which has someone’s name on it. It used to be that cheques were assignable – you could cross out the name on the cheque and write another one. The banks didn’t like this, as circulating cheques meant that people needed to borrow less money from banks. Plus it made the money supply hard to control, and there were fraud issues etc. But you could make a cheque non-assignable by drawing two lines through it. That was called a crossed cheque. Now, crosses are automatically printed on cheque books. So cheques became non-assignable _and_ non-transferable. Banks were very happy to make cheques non-assignable, because it increased their hold on everyone’s finances.
- +
-Another important Chris Cook invention was to make UCOs assignable, not transferable. To explain: a £10 note is transferable. Anyone who gets it can spend it, and it doesn’t matter where they got it from. They might have found it, or got it from someone who stole it – but they can still spend it. No-one will question where they got it. Transferable is clean and anonymous. That’s not the same for a cheque, which has (had? Does anyone use cheques any more?) someone’s name on it. It used to be that cheques were assignable – you could cross out the name on the cheque and write another one. The banks didn’t like this, as circulating cheques meant that people needed to borrow less money from banks. Plus it made the money supply hard to control, and there were fraud issues etc. But you could make a cheque non-assignable by drawing two lines through it. That was called a crossed cheque. Now, crosses are automatically printed on cheque books. So cheques became non-assignable _and_ non-transferable. Banks were very happy to make cheques non-assignable, because it increased their hold on everyone’s finances.+
  
 So – looking back at our energy example above – what assignable not transferable means is that the local energy group holds the register of who’s got the ECOs. If I own some, then I’m the registered holder of those ECOs in the ledger. If I want to sell them, I can only do so to those registered with the energy group, and the energy group can refuse to register anyone they don’t like, for ethical reasons, or because they think they’ll siphon profits out of their local area. The commons groups have control of who they have on the register. This means transparency – anyone who owns the ECOs can find out who else owns them, so the group can make sure that ownership doesn’t become too concentrated, and they’re not used for speculation. So – looking back at our energy example above – what assignable not transferable means is that the local energy group holds the register of who’s got the ECOs. If I own some, then I’m the registered holder of those ECOs in the ledger. If I want to sell them, I can only do so to those registered with the energy group, and the energy group can refuse to register anyone they don’t like, for ethical reasons, or because they think they’ll siphon profits out of their local area. The commons groups have control of who they have on the register. This means transparency – anyone who owns the ECOs can find out who else owns them, so the group can make sure that ownership doesn’t become too concentrated, and they’re not used for speculation.
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-Regulatory agencies are open to being influenced or corrupted by wealthy corporations that they’re supposed to be regulating – so big energy companies, for example, who may not like energy supply being brought into common ownership, might try to influence regulators to move against it. The fact that issuers of UCOs are membership organisations with registers of member-investors makes them less vulnerable to this.+_Regulatory agencies are open to being influenced or corrupted by wealthy corporations that they’re supposed to be regulating – so big energy companies, for example, who may not like energy supply being brought into common ownership, might try to influence regulators to move against it. The fact that issuers of UCOs are membership organisations with registers of member-investors makes them less vulnerable to this._
  
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-Tally sticks were UCOs used by Kings of England from Henry I to allow subjects to pre-pay taxes at a discount. Notches were made on hazel sticks that were then [split in two along the grain](https://en.wikipedia.org/wiki/Tally_stick#Split_tally) – one half for the taxpayer and the other for the state / tax authorities. When the two halves were put together, the notches had to match. It was an early form of very natural encryption!+_Tally sticks were UCOs used by Kings of England from Henry I to allow subjects to pre-pay taxes at a discount. Notches were made on hazel sticks that were then [split in two along the grain](https://en.wikipedia.org/wiki/Tally_stick#Split_tally) – one half for the taxpayer and the other for the state / tax authorities. When the two halves were put together, the notches had to match. It was an early form of very natural encryption!_
  
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-Deli owner Frank Tortoriello wanted to move his deli to a new premises in Great Barrington, Massachussetts, in 1989, but couldn’t obtain a bank loan. He issued ‘deli dollars’ – vouchers for future produce that were a roaring success, and allowed him to make the move.+_Deli owner Frank Tortoriello wanted to move his deli to a new premises in Great Barrington, Massachussetts, in 1989, but couldn’t obtain a bank loan. He issued ‘deli dollars’ – vouchers for future produce that were a roaring success, and allowed him to make the move._
  
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-[Island Power](https://www.island-power.net/) are helping set up renewable energy systems on islands, from the Pacific to the Channel Islands, using energy-credit obligations (ECOs).+_[Island Power](https://www.island-power.net/) are helping set up renewable energy systems on islands, from the Pacific to the Channel Islands, using energy-credit obligations (ECOs)._
  
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 Commons groups can provide sustainable infrastructure – renewable energy, natural buildings, compost toilets and reed beds for sewage, organic food etc. Commons groups can provide sustainable infrastructure – renewable energy, natural buildings, compost toilets and reed beds for sewage, organic food etc.
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-It’s been difficult to challenge the current housing system via housing co-ops, community land trusts and various other mutual-ownership approaches, because of the need for groups to go into debt to get started. Rent-credit obligations allow community-based housing to grow without debt.+_It’s been difficult to challenge the current housing system via housing co-ops, community land trusts and various other mutual-ownership approaches, because of the need for groups to go into debt to get started. Rent-credit obligations allow community-based housing to grow without debt._
  
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- 
-We’d like to hear from people willing to co-design robust legal and governance models. Once these are in place, we’d like to support some candidate groups with promising ideas. 
- 
-The [Credit Commons society](https://creditcommonssociety.org/) is progressing a design for commons housing, so we'd especially like to hear from anyone willing and able to contribute to that work. 
  
 We’ll be adding new topic introductions on how UCOs can be used in all sectors – housing, energy, land, care etc. There are already developments with which you can be involved from the start - [housing commons](/hoco/Housing_commons) and [energy commons](http://lowimpactorg.onyx-sites.io/posts/building-the-energy-commons-marcus-saul-of-island-power). We’ll be adding new topic introductions on how UCOs can be used in all sectors – housing, energy, land, care etc. There are already developments with which you can be involved from the start - [housing commons](/hoco/Housing_commons) and [energy commons](http://lowimpactorg.onyx-sites.io/posts/building-the-energy-commons-marcus-saul-of-island-power).
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 ## Further resources ## Further resources
 +
 +- [Growing the Commons Forum](https://forum.growingthecommons.org/categories) - post queries on the commons
 +- [Growing the Commons Blog](https://growingcommons.substack.com/) - subscribe for commons news
 +- [Split tally sticks](https://www.core77.com/posts/67600/A-Medieval-British-Anti-Counterfeiting-System-Split-Tally-Sticks) - medieval anti-counterfeiting system
 +- [Mutual Credit Services](https://www.mutualcredit.services/) - designing commons models via UCOs
 +- [Deli Dollars](https://www.independent.co.uk/news/business/delidollar-offers-route-to-business-funding-1071370.html) - a type of UCO used in Massachusetts
 +- [Island Power](https://www.island-power.net/) - installing renewable energy using UCOs
 +- [Stroud Housing Commons](https://stroudcommons.org/housing-commons/) developing housing using rent-credit obligations
  
  
  
-## Specialist(s)+## Specialist curators of this topic
  
  
  • ucos/use-credit_obligations.1765708045.txt.gz
  • Last modified: 2025/12/14 10:27
  • by dave