Valuechains hold the key to unlocking the potential of Regenerative Finance

Rice farmers in Hanoi, Vietnam

We humans are collectively creating a reality that none of us individually want: climate crisis, mass extinction, and climax inequality are all rooted in a web of patterns shaping our interactions which can be summarised as “globalised capitalism”. A new set of stories is needed to replace this dysfunctional system. And fast. One of these stories speaks of an alternative operating system for human life on earth, using decentralised databases and exchanges channeling value flows ignored and excluded by financial accounting. Its protagonists, such as members of the Regen Network, invite us to relate to the more-than-human-world by designing more-than-money-markets. Regen Network focuses on payments for ecosystem services, but similar interventions can be imagined for other aspects of life we value that are externalised by the market, such as art, culture, wisdom, care work, etc.

Current Status of Regen Network

So we made a blockchain. And proved that it works for large farmers and large corporations. Now the question is: does it work for “the 99%”? Or more specifically the 80% of ecologically sensitive areas on the planet stewarded by indigenous people? And the 80% of agricultural land stewards that are smallholder farmers?

The premise of fixing market failure by more markets is counterintuitive, to say the least. This could easily become another Ponzi scheme, a speculative bubble benefiting the already privileged elite with the largest ecological footprints – and thus making matters worse (by providing a false sense of security and postponing behaviour change). But it could also become a platform for people and the planet to retake control over the algorithms that shape our economy. What’s it gonna be: top or flop?

Ways Forward

The answer is: we won’t know until we start implementing minimum viable versions and iterate from there. Because there are too many variables to assume success or failure. We often hear tech innovators describe their predicament as “flying an aeroplane while building it”. But in this case, we’re not even sure if what we’re building is a plane, a spaceship, or a donkey cart. 

  • On the one hand, we are a technology project operating in the payment for ecosystem services market and see similar projects moving very fast to quickly capture commercial opportunities, so maybe we are a Registry – like Verra or Gold Standard, but then for claims beyond just carbon. 
  • On the other hand, we are a community project, serving anyone who wants to get involved with shaping the future of the Regen Ledger and the ecosystem data stored on it, so maybe we are a Wikipedia, but then for ecological data.
  • Or… we could be a combination of the two with a few more identities… 

As Dave Snowden explains in his management framework (see Cynefin): when operating in unexplored territory the appropriate approach is to probe then sense and respond, allowing the path forward to reveal itself. Or, as Fritjof Capra recommends: to design for emergence. What does that look like in the case of Regen Network? I see two key ingredients:

  1. One key to a meaningful probe-sense-response process is to have critical stakeholders in our calls, chat windows, and zoom rooms who understand the implications of our tech deployment for real-world communities and landscapes and care enough about the opportunities to address the risks. Starry-eyed believers won’t expose our blind spots, and cynical naysayers won’t have the patience to prevent chucking the baby out with the bathwater. 
  2. A second key is for these critical thinkers to have access to testing grounds, where
  • Field-based requirements (ie, problems to address with new tools) can be signaled and aggregated to gather critical mass (some pilots require overheads that are too much for a small scale project to bear);
  • End-users can be involved in the design of the tools and processes, so that they have a higher chance of actually being used (eg: which functions require internet access? what kind of devices can the software run on, what language is required, etc?)
  • Teams testing similar tools and designs can learn from each other, keeping up morale and avoiding wasting time on duplication;
  • Promising experiments smoothly find their way to implementation so that the cycle of invention>testing>praxis can be completed allowing teams to move to the next challenge. (this implies integration between LABs, pilots, testnet, and mainnet realms)

The Valuechain Proposition

Disclaimer: I am deeply biased about working with value chains because my background is in organic fairtrade food and fibres. And yet I genuinely believe there is a strong case for bringing the worlds of web3 / crypto and agri-based supply chain development / ethical sourcing together.

Products that move from producers (growers harvesting crops) to consumers, through the hands of processors, traders, and designers, have the potential to bring people together across cultures, religions, and political beliefs. In these relationships, the two key ingredients mentioned above come together to create ideal conditions for collective learning.

Both coffee drinkers and cultivators identify with coffee. Both fashion designers and workers in sewing factories can relate to cotton fabric with a passion. If these material flows are such an important part of the lives of millions of people across the planet, why are we not organising ourselves along the lines of valuechain communities? Such social constellations would be natural multi-stakeholder platforms convening people from different backgrounds, each with complementary expertise and perspectives. I would even go so far as to predict that such alliances are going to be crucial to responding to the increasingly complex challenges our industries will face in the future.

But how does this help Regen Network find out if it has a role to play in the lives of indigenous and smallholder farmers and their soils, crops, livestock, and landscapes? The answer is again two-pronged: Stories and Relationships.

Stories

A ledger (decentralised or otherwise) is basically a logbook. A journal with references we tap into when we need to make sense of our world. In the evolution of Data, we arrived at a point where we realise cold numbers are not enough. As Nora Bateson has been explaining, we need Warm Data (see her LAB).

If we want to know whether we are making the web of life better or worse, we can ask the ledger questions such as “How is the forest doing?” “How healthy is the soil?” “What does the fox say?” (sorry, another disclaimer: I’m a Ylvis fan). Now, who better to ask for such updates than the people living on and with the land (or ocean)? This has a co-benefit that it will pull us Western, urban thinking intellectuals out of our screen-mediated mirror cages and confront us with local ecological knowledge systems. Boom!

Relationships

Apart from certain indigenous communities who live in self-selected isolation, everyone is exposed to markets. That means they are inter bioregional relationships. Buyer-supplier ones, competipeer ones, inspector-licensee ones. Etc. As humans, we all want pretty much the same, but as I said in the introduction we’re not creating a world we want because we’re stuck in outdated patterns propagated by unsustainable value systems and goals. A regenerative economy requires relations that go beyond superficial transactions and commodity exchanges. How?

  • The Regen Registry offers a platform to co-create standards specific to each chain (we call them ecocredits, but you can tokenize to your heart’s content once you get the hang of it, including localised mutual credit systems such as the ones promoted by Grassroots Economics in Kenya or social currencies as promoted by Cambiatus in Costa Rica).
  • Community staking DAO’s allow groups who trade together to form and govern a shared treasury and use this to align incentives with shared dreams. The web2 version of this would be a coop of coops such as Justa Trama in Brasil. Web3 makes this accessible for any group anywhere in the world.
  • Both the warm data and the DAO structure can be ways to include the more-than-human world in human decision making, such as explored by USA-Canada cross border watershed governance groups.

These relationships will shape the stories and are, in turn, informed by them. Let’s look at an example:

A cooperative of indigenous farmers in Colombia who have been custodians of a sacred mountain landscape for generations is also exporting container loads of coffee to the USA. Their wilderness stewarding so far did not feature in the commercial conversation about the coffee, though it is an integral part of the farmers’ approach to growing the beans.

In the USA, busy urbanites craving a sense of connection with the planet are watching Netflix documentaries like My Octopus Teacher but don’t realise that actually their morning espresso already puts them directly in connection with one of the most biodiverse places on earth.

What if the act of buying this coffee would not just be a superficial transaction but a multi-layered exchange of deeply meaningful values? What if the brand who is in between the grower and the drinker would act not as a hoarder of surplus but as a facilitator and catalyst for more direct relationships between the nose and tail ends of the value chain?

In Western urban markets saturated with commodified stuff, authentic relationships are one of the few avenues for growth. In rural areas, respect and dignity are what is needed to keep stewards from migrating to slums and forsaking local wisdom.

Valuechains offer a rare opportunity to cover that famous last mile to reach smallholder stewards and invite them to bring in the grounded voices that the web3 platforms such as Regen Network need in order to keep them on track. The value exchanges already happening are a perfect playground for creative ideas.

With What In Mind?

In this early phase of learning about ecological impact beyond carbon, verification beyond remote sensing, and all the many shapes and colours of true biodiversity, it makes sense to focus on stewards who have one foot in the market and one foot in the wilderness.

But to ensure our learning at this stage serves the next generations of the market as well as non-market-based solutions, we need to adopt an open-source approach and culture, which means:

Copyleft, not Copyright. We are experimenting and learning on behalf of Life on Earth -our results and models belong to Nobody in Particular (kind of obvious if we realise that the problems we are solving don’t belong to anyone -so why would the solutions?)

Interoperable. One of the words in the web3 lexicon that brings discipline to the practice, where we see all our creations as pieces of a larger puzzle (the opposite of laptop or phone companies making sure their customers can’t use their friend’s charging cables!)

Breadcrumbs. Leaving a trail of error logs and bug fixes, cumulative insights, and realisations, so our successors can easily catch up (this reminds me of professional chess players who document their games for new entrants in the sport -like an institutional memory of the fraternity)

Join Us

This was a brief explanation of the rationale behind coupling Regen Network to valuechain projects. If you like to be a part of this journey in any way, please write to me at gijs@regen.foundation. I look forward to learning together!

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