Reimagining Money, Banks and our Economy for the Wellbeing of People, Communities and our Planet.

Executive Summary: We propose a money and banking system that enables a fair, sustainable and democratic economy. The current financial system is rife with centralized control, leading to manipulation, corruption, and unfair advantages for select entities.

Printing counterfeit banknotes is illegal, but creating private money is not. The interdependence between the state and the businesses that can do this is the source of much of the instability of our economies. It could – and should – be terminated.”

The fact that the ability of banks to create money requires governments and taxpayers to underwrite the banking system:

“Banking is therefore not a normal market activity, because it provides two linked public goods: money and the payments network. On one side of banks’ balance sheets lie risky assets; on the other lie liabilities the public thinks safe. This is why central banks act as lenders of last resort and governments provide deposit insurance and equity injections. It is also why banking is heavily regulated. Yet credit cycles are still hugely destabilising.”

“What is to be done? A minimum response would leave this industry largely as it is but both tighten regulation and insist that a bigger proportion of the balance sheet be financed with equity or credibly loss-absorbing debt. … A maximum response would be to give the state a monopoly on money creation.

Historical instances of large-cap banks like HSBC engaging in large-scale money laundering and imposing unjust fees on customers underscore systemic flaws that demand a radical rethinking of our financial infrastructure.

Recent events, such as the GameStop ($GME) saga, where centralized powers exhibited undue influence upon public financial markets, highlight the urgent need for a decentralized financial system.


  • The state, not banks, would create all money. Customers would own the money in transaction accounts (which would never be put at risk), and would pay the banks a fee for providing payments services.

  • Banks would also offer investment accounts, which fund loans. But banks could only lend money that was actively invested by customers. They would no longer be allowed to create new money out of thin air.

  • The central bank would create new money as is necessary to promote non-inflationary growth.

  • Decisions on how much money would be taken by a committee independent of government (much like the Monetary Policy Committee).

  • Finally, new money would be injected into the economy via a) government spending, b) tax cuts, c) to make direct payments to citizens, d) to pay down existing debts – national or public, or e) to make new loans through banks or other lending firms (such as peer to peer business lenders).

The transition to a system in which money creation is separated from financial intermediation would be feasible, albeit complex. But it would bring huge advantages. It would be possible to increase the money supply without encouraging people to borrow to the hilt. It would end “too big to fail” in banking. It would also transfer seignorage – the benefits from creating money – to the public. In 2013, for example, sterling M1 (transactions money) was 80 per cent of gross domestic product. If the central bank decided this could grow at 5 per cent a year, the government could run a fiscal deficit of 4 per cent of GDP without borrowing or taxing. The right might decide to cut taxes, the left to raise spending. The choice would be political, as it should be.”

Rationale for Decentralization: Centralized financial institutions wield disproportionate power, evidenced by their ability to manipulate markets and exploit vulnerabilities. The concentration of power in traditional banks has facilitated corruption and malpractice, undermining trust and stability. A decentralized system, comprising decentralized banks, state-owned banks, and decentralized financial stock markets, offers a viable alternative by dispersing control and promoting transparency.

Examples of Dysfunction in the Current System:

  1. GameStop ($GME) Incident: The centralized powers of traditional stock markets were exposed during the GameStop saga, where retail investors challenged institutional dominance. The ensuing restrictions on trading by centralized platforms revealed the extent of control wielded by a few entities, hindering natural market movements.

  2. Banking Corruption: Instances of major banks like HSBC being implicated in money laundering for criminal enterprises highlight the systemic failures of centralized institutions. Furthermore, widespread reports of banks imposing unjust fees on customers and engaging in unethical practices erode public trust and necessitate systemic reform.

The Imperative for Decentralized Solutions: A decentralized financial ecosystem offers numerous benefits, including:

  • Transparency: Distributed ledger technology ensures transparency and accountability, reducing the potential for fraud and corruption.

  • Resilience: Decentralization minimizes the risk of single points of failure, enhancing the system's resilience against external shocks.

  • Inclusivity: Decentralized systems can provide access to financial services for underserved populations, fostering economic inclusion and empowerment.

Support for Hard Asset-Backed and Math-Backed Cryptocurrencies: Hard asset-backed and math-backed cryptocurrencies, such as Bitcoin, offer solutions to longstanding challenges in traditional fiat currencies. By providing a decentralized means of exchange, cryptocurrencies mitigate the risk of inflation caused by political interference. Moreover, the cryptographic protocols underlying these currencies address fundamental problems like the Byzantine Generals' Problem, ensuring the integrity and security of transactions.

Conclusion: The shortcomings of the current centralized financial system, exemplified by market manipulation, corruption, and unfair practices, necessitate a transition to a decentralized model. By embracing decentralized banks, state-owned institutions, and financial markets, coupled with robust cryptocurrency solutions, we can create a more equitable, transparent, and resilient financial ecosystem for all stakeholders.

Recommendation: Urgent action is required to implement the proposed decentralized financial system, leveraging decentralized technologies and cryptocurrencies to mitigate systemic risks and promote financial inclusivity and integrity. Collaboration between public and private sectors is essential to realize this transformative vision and safeguard the future of global finance.


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