A currency that gains value through abundance, not scarcity? That’s the object of a $3.3 million EU research project which doubled the value of an associated token overnight.
A little-known blockchain project more than doubled in value overnight following the announcement of its involvement in a European Union digital economy research program.
The spot price for the Ethereum-based Streamr (DATA) token increased 116% leading into Feb. 12, after it was revealed the project would be used as part of an EU pilot aimed at creating a new kind of money.
Announced on Feb.11, the ATARCA Consortium was awarded €2.75 million ($3.33 million) by the European Commission as part of an initiative to address the “economic inefficiencies” incurred by artificially limiting the supply of digital goods.
In a radical left-turn away from one of the economic principles said to give Bitcoin (BTC) some of its value, the program will try to construct a medium of exchange that gains value through being shared, rather than being scarce.
ATARCA claims to offer an alternative to mainstream economics with its concept of “anti-rival goods” which become more valuable the more they are used. ATARCA, led by Professor Pekka Nikander from the Finnish Aalto University’s Department of Communications and Networking, stated:
“The current economic system is not fit for the 21st century, in which humans increasingly trade abundant goods with a finite medium of exchange. The term ‘anti-rival goods’ denotes a new theoretical category of goods that are characterized by abundance and that, unlike rival or non-rival goods, become more valuable the more they are being used.”
ATARCA proposes the creation of “anti-rival tokens,” which will be tested in the upcoming two-part pilot in conjunction with Streamr, a peer-to-peer blockchain live data streaming network. Streamr will reportedly be used to test-drive the concept of sharing as a means of payment, using its real-time data-sharing network as a sandbox:
“Unlike cryptocurrencies, such as Bitcoin, the value of anti-rival tokens will not be based on scarcity but on the underlying human relations. Their value reflects the way relationships are built over time through repeated interactions, by default benefitting all sides of transactions.”
The first part of the pilot program will initially take place in Barcelona, using the city’s own digital social currency, the Real Economy Currency. Streamr, an open-source project founded in 2017, saw the value of its native DATA token climb to a three-year high upon announcement of the news, climbing from $0.08 to $0.18 in less than 24 hours, according to data from CoinMarketCap.