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Communities

Claim currencies enable self-assembling communities due to the interaction of two mechanisms. This dynamic is important because it allows individuals to join communities better aligned with their preferences, beliefs and values while still incenting tolerance across communities.
To bring this about, the first mechanism to understand is the proportional payment.

With claim currencies, when you transfer payment to someone, the recipient of the money gets a piece of each of your claims.
Here’s a visual explaining how that works.
Imagine this is someone’s wallet. Each bar represents a token of some value:
image.png
You can see a $1 payment to the left of the line. It’s made of a piece of each token in the wallet based on token value.
image.png

This means that if one of the tokens in their account was the claim “the Earth is flat” and you don’t think the Earth is flat, then you might not want to receive that token. You might want to avoid it either on preference grounds (”there are bad consequences from believing the Earth is flat”) or on pragmatic grounds (”one day that claim will be tested enough that it will collapse in value, I don’t want to be left holding it.”)
So what can someone do when a flat Earther tries to transfer them a payment that contains a claim like “the Earth is flat”? That’s where the stance mechanism comes in.

The economy would grind to a halt if you had to check each transaction for claims you were comfortable accepting.
Instead, we can allow market participants to set stances that discount claims.
Let’s say the flat Earther agreed to pay
$100.00
to you.
You set a stance that discounts the claim “The Earth is flat” at
100%
0
1
If
000
20
dollars of the
$100.00
payment was staked in “The Earth is flat.”
The payment to you would be:

base:
$100.00
+ premium:
25.00
= total:
125.00


Here’s a graph showing how the total the flat Earther has to pay you changes as they increase the amount of money they have staked in the claim, “the Earth is flat.”
000
0.8
← Try changing your stance

Need help interpreting the graph?

If you set your stance to 0.8:
image.png
then hover your mouse over over 100
image.png

this tells you that $100 of the $100 payment (100%) is staked in a claim “The Earth is flat.” which you are discounting at 80%. The Total Payment section shows $500, which means that this small $100 payment would cost a total of $500 to send since there’s so much disagreement. $100 from the original payment plus $400 due to the disagreement premium.
You can see that this strongly incents you to have lightly held stances when there’s disagreement, and for beliefs to be widely accepted before they are strongly held.
This graph simulates the disagreement premium for a payment containing a single discounted claim. Handling multiple discounted claims isn’t difficult. If you have two discounted claims you just sum up the disagreement premiums.
This is the equation that sets the Disagreement Premium:
Proportion Discounted = Value Discounted / Requested Payment
Disagreement Premium = (Requested Payment / ( 1 - Discount * Proportion Discounted )) - Requested Payment
Total Payment = Disagreement Premium + Requested Payment
To read more about why this is the equation, go see


You can see that the more fanatical the flat Earther, the more expensive it will be for them to pay you. But what will the flat Earther think of this? They’ll certainly tell you, “No way. I’m not paying that. Either reduce your stance or reduce your price.” This means that your underlying beliefs and preferences have become part of the negotiation. This is exactly what we want, as right now our economic systems ignore or paper over differences in values.
What would it look like if instead of a flat Earther, someone with highly aligned beliefs and preferences was trying to pay you? Well, you’d still have to agree on price, but overall the total payment would be cheaper for them than it was for the flat Earther, meaning they would prefer to pay you, and you would prefer to pay them.
You can see how this naturally causes economic communities to spring up. People with aligned preferences and beliefs will tend to transact more because it’s cheaper, leading them to create economic relationships that mirror their underlying epistemic and preferential orientations.
The immediate concern then becomes, “But won’t this create a tendency for economic silos to exist, where certain groups are excluded?”
This is no different than today, where it’s possible for a country to levy a tariff against an ideological rival. And, just as in that case, both countries are always economically better off with free and open trade (no tariff). This is enabling that ability to institute tariffs down at the level of the individual.
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