Money is no object: Money,cryptocurrency,fiction

Abstract

Georg Simmel depicts money as an evolving entity that will continue to evolve to a state of ‘perfect money’ disconnected from any external guarantor of value. This article examines some of the different approaches to substantial value underpinning money, suggesting that they represent different types of fictional underwriting. Money is then contrasted with cryptocurrency, suggesting that their respective value is not only derived from different fictions but from different standards of value as major and minor currency. This analysis suggests that far from evolving into a fully abstract and functional instrument for creating stable social relationships, the divergence in currencies and currency fictions is a force for overturning such ‘expedient’ stability.

Introduction

The meaning of money lies in the fact that it will be given away. When money stands still, it is no longer money (Simmel, 2004: 517)

Money is the rhizome of all evil, created by holding back from consumption, thus originating with denial. Money transforms but is not teleologically drawn towards a state of perfection, disconnected from any source of value (see Simmel, 2004). Money is an event, a narrative technology, an assemblage, a marketplace icon, a catalyst for desiring production but it is also a materialised fiction. Money is thus a means of communication but also has the capacity to ‘buy’ silence (Moor, 2018: 557). Although money is currency and has currency, the scope of this study is the type of currency prefixed by the word ‘crypto,’ which, as much of the literature insists (see Rotta and Paraná, 2022: 3–4) is not money at all. The insistence that a matter is not about money tends to draw attention to the way in which it is about money. This analysis concerns money in all its denominations, focussing in particular on addressing the following set of claims about money:

Beyond the state it’s money that rules, money that communicates, and what we need these days definitely isn’t any critique of Marxism, but a modern theory of money as good as Marx’s that goes on from where he left off (Deleuze, 1995: 152)

The assertion underpinning the argument developed here is that key insights for a modern theory of money (not to be confused with Modern Monetary Theory) can be found in focusing on cryptocurrency through a Deleuzian lens. Before presenting this argument, it will be useful to begin by examining other influential ways of conceptualising money and their limitations.

What is money and what does it do

As with Deleuze’s body of work in general, there is no pivot on which a Deleuzian understanding of money turns, there is no privileged entryway; each route alters the map, assembling and conceptualising money through different components and facets. Beginning with a clear definition of money and an evaluation of the consensus view of what constitutes money is also not straightforward. Nor, indeed, is the more Deleuzian approach, embodied by assertion that the: ‘question posed by desire is not “What does it mean” but rather “How does it work?”’ (Deleuze and Guattari, 1984: 109), which amounts to shifting emphasis from defining money to asking how money works. The twin difficulty with this is in large part because the ontology and functionality of money seem to be inseparable, even for economists; indeed, as every economist since the ‘founder of modern economics’ William Jevons (1879) knows, money qua money must perform specific transcendental functions: a medium of exchange (acceptable form of payment), a unit of account (measure of value for different goods), a standard of value (a means of deferred payment), and a store of value (see Davies, 2010: 27–28). These functions are linked to specific properties of money, such as: cognizability or identifiability; divisibility; durability; fungibility or interchangeability; portability; scarcity. The problem, of course, is that this gives a very misleading and superficial understanding of value, and by implication, does not explain money (see e.g. Smith and Kumar 2018: 1541–1544), as will be shown in the discussion of cryptocurrencies later in this article. This is important because focussing on these characteristics tells us very little about the most insightful aspects of money (what it does) and its underpinning value, in particular those suggestive of the route to pick up where Marx left off.

Before turning to Marx, a few considerations on what money is/does will be useful. Georg Simmel’s work The Philosophy of Money (Simmel, 2004) examines money and value through a variety of registers, focussing on the implications of perceiving money to be an instrument that is not dependent on a specific intrinsic value, but instead in terms of its ability to bridge other relationships (see e.g. Simmel, 2004: 129–131). What money does can be demonstrated through a variety of its empirical economic functions, but in an abstract sense, money cannot be reduced to these functionalities. Instead, such usage represents and expresses variations of an idealised form that Simmel terms ‘perfect money’ – a form that does not resemble any real manifestation of money. Money in this ‘perfect’ sense is an ideal type, as are the different forms of value underpinning it and the ideal social order corresponding to it (see Dodd, 2012): 149–152). Money, in this abstract sense, is not an object but a fiction: ‘correct, pure, or perfect concepts in Simmel’s work are fictions’ (Dodd, 2014: 317). This approach to money will be encountered later in this article, but it is not the only influential approach to deny money a substantive character. David Graeber’s observation, from a historical and anthropological perspective on exchange practices, is that: ‘money has no essence. It’s not “really” anything; therefore, its nature has always been and presumably always will be a matter of political contention’ (Graeber, 2011: 372). This does not mean that for Graeber money is ineffable but is instead to be understood in terms of debt, both as a precursor to money and as an obligation to pay tax using money, which implied the need to engage in monetary transactions. Indeed, Graeber insists that money continued to exist even in the absence of it physical symbols, through financial instruments, such as promissory notes or primitive letters of credit, and it was money rather than barter that was the pre-eminent mode of exchange for the past two and a half thousand years (see Graeber, 2011). For Graeber, the relationship between money and debt is crucial, particularly in disrupting attempts to reduce social relations to exchange. Indeed, to introduce yet another component of this argument, Maurizio Lazzarato (2012) observes that money as debt produces an asymmetry of power, imposing modes of future exploitation, domination and subjection. Lazzarato’s approach synthesises key aspects of Simmel’s relationist theory of value with Graeber’s framing of money as the violent servicing of debt through military–coinage–slave complex, concluding: ‘Money is first of all debt-money, created ex nihilo, which has no material equivalent other than its power to destroy/create social relations’ (Lazzarato 2012: 34). This suggests that how money - or the fiction of money - is conceived genuinely matters, whether it is a thing or not, created from something or nothing.

If, as Simmel, Graeber and Lazzarato insist, a closer inspection of the origin of money is required, then there are several competing ideas concerning the ontology and operation of money. There is some overlap between these different ways of conceiving the structural features of money, but the differences can be approached strategically by focussing on the contrasting assumptions in how the value of money is sustained. In this sense, money can be conceptualised in the following ways: as underpinned by debt or credit, or as a commodity, or due to its fiat/state-backed form, or in terms of other tax-paying attributes, or in terms of other representative/symbolic functions or, indeed, as a combination of these characteristics. Unlike the list of transcendental features and characteristics outlined earlier, the operation of money helps to map the assemblages through which it circulates. For example, the commodity theory of money identifies the value of money with a commodity having an intrinsic value. The credit theory implies money is not a material transfer, but an opportunity to transfer or cancel a debt, while the fiat theory suggests that the value of money is maintained and guaranteed by third parties, such as nation-states, particularly for monetary form accepted as tax payment. These characteristics are further assembled through other socio-political conceptual forms: Marx’s universal commodity form, Simmel’s claim upon society, Zelizer’s diffuse social media, Ingham’s social technology, Hart’s instrument of collective memory, Parson’s generalized symbolic medium, Maurer’s social process of commensuration, Karatani’s communal illusion, Lazarrato’s coercion by debt and Land’s technocapital machine, to name just the more intriguing examples (see also Dodd, 2014: 4). As Nigel Dodd observes: ‘The diversity of notions of money within the literature provides us with ever-present opportunities for reinventing it’ (Dodd, 2014: 9). By extension, this plurality of money theory discloses that a common measure of value or a common purpose of money is: ‘a pure fiction, a cosmic swindle’ (Deleuze and Guattari, 1984: 230) and, in addition, that ‘stable’ money or purely circulating money is an ‘essential fiction’ (Simmel, 2004: 191). The fiction of money is therefore an asset of (potentially) considerable value.

Fiction and myth were founding conditions of money or are themselves founding fictions of money. Ritual sacrificial distribution involving ceremonial killing as an offering to the gods as an act of worship (and an equal distribution of the meat to all male members of the tribe) is a crucial component in accounts of the emergence of value and money (see also Graeber, 2012: 413–414). Through this propitiation fiction, an equal distribution of spoils becomes coupled to an equal obligation to communal survival, which in turn created a universal concept or scale of value:

When the ultra-modern technologies of the East – literacy, numeracy, and accounting – were combined with the idea of a universal scale of value incubated in the barbaric West, the conceptual preconditions for money were at last in place. (Martin, 2013: 60)

This universal scale of value suggests a paradox: that exchange without markets or without a focus of self-interest or money are at the core of human sociability, but such sociability, with its socially enhancing gift exchanges, is a fundamental element in the emergence of money. For Graeber, the focus of sociability implies a justification for the reciprocal economy: from each according to their ability to each according to their need. For Marx, there are many more stages of myth-building through which money must circulate, before eventually, and in Marx’s view inevitably, withering, like the State. It is to this logic that the article will now turn.

Marx and money

Deleuze’s final, unfinished project was to examine the grandeur or greatness of Marx (Dosse, 2010: 454–455). Deleuze’s intellectual relationship with Marx is complex but productive, particularly:

[Marx’s] analysis of capitalism as an immanent system that’s constantly overcoming its own limitations, and then coming up against them once more in broader form, because its fundamental limit is Capital itself (Deleuze 1995: 171)

This is of crucial importance as Marx’s analysis of the emergence of capitalism begins by examining commodities and money (Marx, 1990: 125–244). These first three chapters of volume 1 of Capital are often reduced by commentators to a number of simple relationships expressing a rudimentary commodity theory of money: money, as the value of the standard of prices, is attached to a commodity possessing use-value and possessing intrinsic value, such as gold. Such a commodity circulates because it has value, unlike banknotes, which have value because they circulate (see e.g. Nelson, 1999: 1–3). Although Marx’s thinking was, of course, shaped by the bullion-backed forms of money he encountered in contemporary life, it must also have been shaped by observing the powerful financial institutions of London and the credit money that formed the British bourgeois economy. Careful observation shows that Marx defines ‘commodity’ in a specific way that presents a more nuanced account of the complex nature of these different encounters with money. This approach encompasses a broader understanding of the relationship between money, value and labour. In short, money originates from the exchange of commodities, which in turn is itself a commodity: the money commodity. Money receives a specific value form through exchange, standardised through its circulation. Money is, therefore, the measure of value immanent to commodities as embodied in (abstract) labour-time. In contrast with a conventional commodity theory of money, such as David Ricardo’s (see Ricardo, 1811), Marx develops a (unique) theory of the money commodity, a theory which is invoked ‘partly to kill any idea that the social system might be reformed through monetary management’ (Nelson, 1999: 79), that is, Marx presents a material basis for revolution. In this way, money is both universal (measure of value) and particular (medium of circulation) but it is also a store of wealth and thus valued as a commodity (to be acquired – and fetishized – for its own sake) not merely as a token representing commodities or symbolising value. Marx’s theory of money reveals that the capitalist is little more than a ‘rational miser… throwing his money again and again into circulation’ (Marx 1990: 254–255) and through these circulating channels, money becomes the full body of capital, flowing to maintain and sustain itself. In this way, the material properties of money melt into the social conditions of its fabrication.

It is clear that fetishisation, flow and circulation, as conditions of money, are themes likely to resonate with concepts central to Deleuze (and principle collaborator Felix Guattari), but there is an additional theme to be drawn from Marx: the fictional character of money as a ‘complex and contradictory ensemble of social relations’ (Dodd, 2014: 63). There are several elements to this, but an entry point can be found in Marx’s theory of credit (see Kerslake, 2015). Through his version of credit theory (Capital III) Marx shows that capital accumulation requires capital to adopt a cycle of various forms (money, commodities and means of production), forming a credit bubble. In this form, inflating credit money gives the impression that capital is self-expanding and leads to the formation of fictitious capital (financial assets drawn from prospective future additional production), which nourishes the speculative bubble … and intensifies its inevitable crash. Marx’s notion of fictitious capital approximates an ‘auto-multiplication of money’ (see Karatani, 2003: 22) and contrasts with real capital, that is, commodity/productive forms of capital (see De Brunhoff, 1990). Fictitious capital encompasses a credit system of speculative assets – stocks, shares, securities, government bonds, state debt and similar forms of imaginary wealth premised on the assumption that money inevitably earns interest: ‘everything in this credit system is duplicate and triplicate, and is transformed into a mere phantom of the mind’ (Marx, 2005: 603). The distinction debunks the illusion that there is a single monetary mass. The difference or ‘dissimulation’ between real capital/payment money and fictional capital/finance money reflect the dualism of money; however, the operation of the different facets of money exists in a dynamic tension, with profound socio-economic implications: ‘the boom of fictitious capital is also the product of unresolved social and economic contradictions’ (Durand 2017: 8). This includes the weaponisation of fiction to promote exuberant versions of the future to rationalise bubbles (see Gisler et al., 2011; Huber and Sornette, 2020) either as signals that something else – an untapped potential – is possible, or, in counterpoint, to construe the signs of a system, spent and on the edge of crisis, as a coercive call for allegiance and blind trust:

Left to itself, fictitious capital would collapse; and yet that would also pull down the whole of our economies in its wake. In truth, finance is a master blackmailer. (Durand 2017: 129)

In Marx’s time, it could be argued that the banking system itself was ‘the most artificial and elaborate product brought into existence by the capitalist mode of production’ (Marx 1992: 742) a system engendering and maintained by competing fictions of value lacking any material basis in production. It is no coincidence that it was in 2008, in a moment of (global financial) crisis, when the fiction underpinning this system could be glimpsed as nothing more than a fiction, that a new system emerged from a source afforded by the most artificial and elaborate produce of our time, that is, the internet, and based on an equally implausible fiction: the alchemical transformation of a perpetual peer-to-peer journey of a chain of blocks of numbers into digital gold, that is, cryptocurrency. To paraphrase Nick Land, cryptocurrency teaches us, even before it is fully established as an alternative currency, that we are not yet confident to address the fundamental question of what money can do (Land, 2018).

What is cryptocurrency and what does it do

There is a sort of vast cycle of flows of production and chains of inscription, and a lesser cycle, between the stocks of filiation that connect or encaste (encastent) the flows, and the blocks of alliance that cause the chains to flow. (Deleuze and Guattari, 1984: 149)

Cryptocurrency derives from and creates these blocks and chains through which a new monetary fiction emerges. The components of its fiction and the characteristics of cryptocurrencies offer insight into hidden aspects of money (see Dodd, 2014: 226–236). It is in many ways the clearest illustration of a fictitious commodity in the sense that Polanyi applied to money: it cannot legitimately be bought or sold but is merely a promise (see Polanyi, 1957): 76). One bitcoin is worth one bitcoin, which is an unbreakable promise. The implications of this promise underpin all cryptocurrencies and explains how they relate to other forms of money and value. This is important because even the most established and widely accepted of cryptocurrencies, such as bitcoin, might encompass none of Jevons’ functions of money and have few of the properties that economists associate with cash. Instead, cryptocurrencies are currencies, assets or transferable credit by virtue of rather different features. The story of the development of cryptocurrency is now relatively well known, but a short account of its initial conception and establishment will be useful at this stage.

On 1st November 2008, an individual or collective using the pseudonym Satoshi Nakamoto (another fiction), announced on the Cryptography mailing list the publication of a ‘white paper’ (Nakamoto, 2008) briefly explaining the protocols for a peer-to-peer electronic cash system (bitcoin). The system is based on relatively simple premises: individual units of cryptocurrency themselves are created and tracked through a decentralised/distributed peer-to-peer network using an open source ‘blockchain’ protocol. Although the technical aspects are somewhat ‘technical’ the logic of the development and scaling of bitcoin, which remains the most influential and traded cryptocurrency, is straightforward, as indicated by the brevity of its white paper (Nakamoto, 2008; see also Karlstrøm, 2014; Vigna and Casey, 2015; Swan, 2015; Dodd, 2018; Land, 2018).

An important clarification is that a cryptocurrency is not merely a digital currency/electronic payment system but is also, in addition, a network that establishes (through a chain of blocks) which account ‘owns’ which crypto assets at each point in their virtual existence. This is not trivial: establishing unequivocal ownership addresses specific problems that had previously required resolution through a guarantor or being underwritten (maintaining its promise) by a third parties, such as a bank. These problems include the following: 1) the double spending problem, which requires determining if (and when!) a unit of currency has been spent, and 2) the Byzantine fault tolerance problem, which requires establishing a coherent global view of the state of the currency’s system (under conditions of potentially unreliable actors). The strategy to address problems without trusted third parties is through a distributed public ledger (the ‘blockchain’). The mechanics of the blockchain ledger are set out in the white paper in short sections on: transactions (digital signatures/data as currency), timestamps (proving when data existed), proof of work (full agreement of exchanges), running a network (validating the latest ‘block’ of exchanges), incentives (creating and ‘gifting’ new units of currency), payment verification (defining valid payments) and privacy (using anonymous public keys) (Nakamoto 2008). This might sound complex, but it merely describes the features of a virtual network enabling incentives to store part of a distributed record of transactions and a ‘system for participants to agree on a single history of the order in which [cryptocurrency transactions] were received’ (Nakamoto, 2008: 2). In essence, crypto was born free but everywhere is in blockchains.

That this flow of transactions and storage of balances has value can be explained in terms of a variety of narratives: enforceable contracts, ‘trustless’ exchange, a digital gold standard, a counterfeit-resistant commodity, a hoardable digital resource, a fictional catalyst, a credit from the future and so forth. These narratives can be anchoring in the forms of value described by the various theories of money. Through these different theories of money, the features that cryptocurrencies share with money, that guarantee the value of money, transform into new, but no less powerful, hybrid-fictions: virtual commodities, virtual fiat and virtual credit.

A cryptocurrency, such as bitcoin, is not backed by a commodity, such as gold or some other guarantor of its value, yet the features defined within the blockchain mechanics make it appear to be commodity backed. The metaphors of digital gold, the mining of a strictly limited number of bitcoins (6.25 per 10 minutes as of 2022) extracted using customised PC rigs imply that bitcoins are not created from nothing but are backed by a scarce commodity: ‘The steady addition of a constant amount of new coins is analogous to gold miners expending resources to add gold to circulation’ (Nakamoto, 2008: 4). Cryptocurrency is fictional commodity money: ‘a kind of virtual gold standard. Bitcoin is gold money without gold’ (Bjerg, 2016: 60) but it is a ‘robust’ fiction founded on an obligation that is coded into the machinery of its blockchain structure.

To ensure that a virtual commodity is not counterfeited requires a system suggestive of a further hybrid fiction: digital fiat. Cryptocurrency emerged in response to the failure of the banking system, ‘in the throes of the 2008 financial crisis’ (Vigna and Casey, 2015: 9). It was designed explicitly to serve as a peer-to-peer electronic cash system; however, the blockchain system makes demands and makes claims on its community and, in turn, reintegrates with fiat money systems through currency exchanges. These two factors are crucial to the value of cryptocurrency. In being tradable for other currencies, cryptocurrency is accepted by a community of crypto traders – it is a claim on society in the narrow sense of the society of crypto enthusiasts. In this regard, it has an intrinsic value in assembling and sustaining this community; trust is decentralised and distributed but it remains trust, in particular the trust that other enthusiasts will remain enthusiastic, that the community will hold, and that people will want it, value it and exchange for it. Cryptocurrency is, in this regard, a virtual or post-fiat currency, functioning in a similar way to a fiat currency but through a broad user-community rather than a state. The book The Age of Cryptocurrency (Vigna and Casey, 2015) begins with the story of Film Annex, a US social media platform, which pays hundreds of Afghanistan-based women in bitcoin to produce its digital content. Through this account, it is Film Annex, not the US military that fights the Taliban, and its weapon is cryptocurrency: ‘it allows women in patriarchal societies, at least those with access to the Internet, to control their own money’ (Vigna and Casey, 2015: 2). Similarly, Bjerg uses the example of Palestinians using cryptocurrency to leverage some independence from Israeli monetary policy. These two examples illustrate that virtual fiat money creates communal sovereignty and not vice versa (see Bjerg, 2016: 63–64)

A third way of conceptualising the value underpinning money that can be applied to cryptocurrency is through credit and debt. David Graber suggests that money has always been widely perceived as representing debt (Graeber, 2011), while Alfred Mitchell Innes defines money itself as credit and nothing but credit (Innes, 1913) in the form of transferable debt. Debt is also a way of clarifying key differences between currency and money, as Felix Martin argues: ‘But currency is not itself money. Money is the system of credit accounts and their clearing that currency represents’ (Martin, 2013: 13). Indeed, contemporary fractional reserve banking only works because of the fiction that account holders can exchange their entire credit money for tangible cash money, which means they will never need to convert it while the fiction is maintained. The issue of debt and convertibility are, though, factors that function in a very different way with cryptocurrency. With bitcoin, for example, new currency cannot be created through credit: there is a finite supply – with a maximum limit of 21 million bitcoins – of which those in existence circulate back and forth as a system of zero-sum transactions. Fractional reserve banking and currency debasement are forbidden by bitcoin’s code; however, the consequence of an undebasable currency is to strengthen the community of users attracted to – and thus in effect generating – a deflationary currency. Credit is not leveraged through tangible debt, but through hording now, getting paid later, converting a unit of currency today based on a more valuable unit from the future. In this way, seigniorage is extracted, accrued and converted into value from the future relative to its creation, usage and distribution today. This fiction of convertibility underpins cryptocurrency, which: ‘does not represent a claim on any particular debtor but rather a claim upon the whole “society” of Bitcoin users’ (Bjerg 2016: 67) Cryptocurrency is, in this regard at least, credit money without the debt.

The conclusions to be drawn from this evaluation are very clear: the value of a cryptocurrency is not guaranteed by a commodity, the state or credit/debt but by the fictions that couple the guarantee of value to the currency, but in many ways the value of money is itself derived from its own fictions. Cryptocurrency, as hybrid money, is underpinned by hybrid fictions, but additional levels of fiction have an impact on the way it performs as currency and acts as money. Bjerg is correct in concluding that a cryptocurrency like bitcoin ‘is no more fake than more conventional forms of money’ (Bjerg 2016: 68) but it is also no less fake than conventional forms, which in limiting and vetting the fictions able to serve as a guarantor, is both a strength and weakness.

Cryptocurrency as minor currency

Understanding the relationship between cryptocurrency and money cannot begin by contrasting the ability of a cryptocurrency, even one as established as bitcoin, to match the transcendental characteristics of money (see Bjerg 2016: 54) partly because it does not match the characteristics of money and partly because the way it differs from money is supposed to be a key strength. The critique of cryptocurrency as merely of fictional value almost resembles a form of ‘projection’ in attributing to digital forms of currency the very flaws implicit in conventional currency forms (see Bjerg, 2016: 69). Cryptocurrency is better characterised as an attempt to deterritorialise money but its deterritorialisation also, inevitably, implies a reterritorialisation: a dissolution of social solidarity that is nevertheless premised on a community supported through a highly organised social structure, mirroring features and the admiration of the mainstream financial system.

Instead of examining cryptocurrency as a substitute for money, the notion of a minor currency is used to express the implication of a deterritorialisation of money. This concept is useful in rethinking relationships based on notions of re-evaluating standards of value. The insights in applying or operationalising the concept of minor currency are derived from reorienting the relationships implied by existing value standards – and fictions. They also provide an approach for examining some of the emerging implications of the creation, circulation and exchange of broader classes of digital assets, including non-fungible tokens, digital tokens for physical assets, digital securities, Central Bank Digital Currencies and metadata.

To develop the concept of minor currency, it will be useful to establish and unpack the minoritarian/majoritarian distinction as determined by Deleuze and Guattari (1986). Minoritarian in this sense does not refer to a numerical or cultural minority or to an ethnic minority but is characterised in terms of its difference from an embodiment or approximation of a standard that defines a majority. The ‘majority’ in this sense assumes a state of power and domination as the standard measure (see Deleuze and Guattari, 1988: 105). The French language, for example, is spoken by more than 200 million people in Africa, but the collective experience of francophone Africa is minoritarian in relation to French cultural hegemony, in particular in relation to the majoritarian (dominant but numerically tiny) Parisian elite. In other words, the majoritarian character is a constant, homogeneous system (e.g. as money in an official prison bank account) in contrast with the minoritarian character as subsystems (a prison exchange system – food, phone cards, tobacco or contraband items) dependent on, but invisible within, the system. Conceptualised in this way, minoritarian entities are perceived as ‘a potential, creative and created, becoming’ (Deleuze and Guattari, 1988: 105–6). In this regard, majority is expressive of identity, that is, inert and invariable. As will be made apparent, in this sense becoming-majoritarian is an oxymoron – becoming is always minoritarian, that is, not appealing to who we are, but to what we – what money – might become. More importantly, however, Deleuze and Guattari go beyond a straightforward majority-minority duality, adding a third category or state: ‘becoming-minor’, that is, a creative process of becoming different or diverging from the abstract standard (of value) that defines majority. It is this third state that will provide insight into cryptocurrency as a type of coded money or minor currency.

A minor currency emerges from within this conceptual relationship, in much the same way as other fiction-based tools and concepts. For Deleuze and Guattari, a minor literature does not attempt to meet the (‘privileging’) standard of literature but instead attempts to subvert or revise the standard: ‘minor no longer designates specific literatures but the revolutionary conditions for every literature within the heart of what is called great (or established) literature’ (Deleuze and Guattari, 1986: 17–18). In this regard, all great literature is minor literature in that it creates its own standard. Deleuze and Guattari use the example of Franz Kafka’s writing to illustrate the point. Kafka was a Czech and a Jew writing in German, a language that although foreign to his being was also a channel for the creation of identity. Kafka was a great writer in this sense because he wrote without a standard view of the interpersonal problems of people, concerned instead with the ‘social assemblages’ themselves. In this way, Kafka’s work does not represent an established identity, but is prefigurative, and as such, gives voice to that which is not given: a ‘people to come’, namely, a people whose identity is a work in progress, in a state of creation and transformation.

Through Deleuze and Guattari’s characterisation of minor literature, it is possible to identify three key characteristics of a minor currency: 1) the deterritorialisation of coding; 2) the connection of the individual to a political immediacy; 3) in becoming a setting where everything adopts a collective value (see Deleuze and Guattari, 1986: 18). These insights provide clarity concerning the relationship between money and cryptocurrency.

The first characteristic of a ‘minor currency’ is the sense in which a currency is ‘affected with a high coefficient of deterritorialization’ (see Deleuze and Guattari, 1986: 16). In this way, invisible or otherwise suppressed features of a currency become repositioned as the point of emphasis and thus challenge the dominant codes and conventions of money, which, as a consequence, become rendered foreign or incoherent. A cryptocurrency, for example, has few of the transcendental characteristics of money outlined earlier. Its volatility renders it unsuitable as a measure, standard or store of value, features underwritten by banks and government institutions. Instead, its primary features are derived from being outside the banking system, such as allowing pseudonymous exchange and transfer across international borders, based on consensus derived from a distributed ledger of transfers rather than trust in third parties. Additional features of new cryptocurrencies can be designed into their code to emphasis different properties, or to become smart contract repositories, digital in-chain markets or platforms, in a way that money cannot (see Caliskan, 2020). Money, as Liz Moor argues, communicates in a language that is always open to such deterritorialisation: ‘Currency, payments and prices can “send a message,” but this is often done in the service of wider goals such as creating bonds between the individual and the collective, or indeed rejecting those links and creating new ones’ (Moor, 2018: 580). Indeed, for Jean-Joseph Goux, the analogy between language and money runs deep, hiding in plain sight through our dual conceptualisations, as it were, as illustrated in his celebrated analysis of André Gide's (1925) novel The Counterfeiters (Les Faux-monnayeurs) (Goux, 1994). For Marx, however, the correct analogy for money ‘lies not in language, but in the foreignness of language’ (Marx 2005: 163) the feature most clearly embodied by cryptocurrency, which is the most exotic of foreign languages.

The second defining characteristic, identified by Deleuze and Guattari, is that a minor currency emphasises social and political forces. This characteristic provides: ‘cramped spaces [that] forces each individual intrigue to connect immediately to politics’ (Deleuze and Guattari, 1986: 17). Cryptocurrencies emerged in the wake of the 2007/8 global financial crisis, a crisis rooted in, and inherent to, the banking sector itself – in the financial instruments created, the risks and rewards taken, the reregulation lobbying influence acquired – and not a crisis merely affecting the banking sector (see Bordo et al., 2015: 239–241). The initial promotion of bitcoin as an alternative currency explicitly drew upon dissatisfaction related to the perceived corruption of financial institutions and the complicity of states and governments overseeing them. As a consequence, the number of bitcoin enthusiasts initially grew by attracting individuals with libertarian and anarchistic values (Karlstrøm, 2014) and similar ‘outsiders’ attracted by ‘the glow of a utopia just over the horizon, and a cosmogram for getting there’ (Brunton, 2019: 61). Cryptocurrencies initially embodied this political ethos as a ‘breakthrough in the long-awaited realization of an old “cypherpunk” dream of money that is free from the control of the state and other third parties, such as commercial banks’ (Reijers et al., 2016: 139). Equally, it reconfigures the social and political forces though its technological mediation of exchange: ‘Bitcoin is politics masquerading as technology, or technology soliciting and promoting a very specific politics’ (Golumbia, 2015: 119). For David Golumbia, cryptocurrency is not just political in the sense of being socially embedded but is an explicitly libertarian politics that is ideologically right-wing and unashamedly anti-government.

The third defining characteristic of a minor currency is that it both enables and embraces collective value:

there are no possibilities for an individuated enunciation that would belong to this or that “master” and that could be separated from a collective enunciation. (Deleuze and Guattari, 1986: 17)

Cryptocurrency assets exist as assets (and derive their value) through their inclusion in a distributed – peer-to-peer – ledger. A cryptocurrency’s collective value is (digitally) embodied by a ledger, the very technology through which a cryptocurrency is able to visibly resist state power and avoid conformity to existing financial categories or dependence on established banking instruments, techniques and traditions. A cryptocurrency is therefore a consensus mechanism and derives its value as a publicly visible sequence of exchanges, created by a distributed system that sustains the ledger’s ability to track changes by maintaining their visibility. The entanglements of mining, trading, hoarding and get rich quick ‘pump and dump’ systems and charmingly amateurish attempts to formalise local currencies and LETS schemes as ‘crypto’ versions, require little investment in the sophisticated conventions of debt finance, fractional reserve banking and accountancy. A cryptocurrency does not repeat money but repeats the power of difference from which money derives its value.

Unlike money as a major currency attached to the service of power, cryptocurrency, as minor currency, renders the relationship between money and politics visible, both as collective value, and new alliances of technology, finance, fiction and ultimately desire, which shape its conditions. Collectively, then, the characteristics of minor currency indicate that cryptocurrency is best understood not as an attempt to imitate commodity/fiat/credit currency, nor to supplement it, but instead as an attempt to transform money. Cryptocurrency is thus a productive fantasy, decoupling the fictions that underpin conventional currency only to reterritorialise them as a new vehicle for desire. The scope of the problem that each individual minor currency addresses, even if not clearly articulated, is the force reanimating its character and elucidating the practical politics of the minor: ‘commodity money without gold, fiat money without a state, and credit money without debt’ (Bjerg, 2016: 53). These possibilities and implications are examined in the following section.

Accelerating exchange relations?

In 1971, US President Richard Nixon unilaterally cancelled the direct international convertibility of the US dollar to gold. This ‘Nixon Shock’ triggered the end of the Bretton Woods Agreement, a system designed to maintain fixed exchange rates between national currencies and the US dollar, erasing the final remnant of the Gold Standard. It also heralded a re-evaluation of the commodity theory of money coupled with the emergence of a proliferation of financial instruments and practices premised on new fictions of value and market efficiency and tailored towards the interests of speculators in newly fabricated assets (see Bordo and Eichengreen, 2007). The financial instruments that fuelled the 2007/8 financial crisis, and the conceptual framework of the digital currencies designed to replace them as a repercussion of that crisis, can each trace their ancestry to the monetary policy innovations (replacing currency exchange rates as the focus of monetary policy) resulting from the end of Bretton Woods (Garten, 2021). Indeed, there has been a steady proliferation of both major and minor currency mechanisms, a trend largely accelerated with the unfolding of digital technology. Their relationship is not dialectical nor strictly oppositional, but based on the contrasting way that values, standards and identity shape their respective fictions, narratives, markets and engagement opportunities, or in other words, how they embody either an ‘extensive’ or an ‘intensive’ multiplicity (see Deleuze and Guattari, 1994: 127). The complexion of its multiplicity will therefore govern a currency’s transformative potential, explaining the ways in which cryptocurrencies – as minor currencies – both subvert and reproduce extant monetary orders encompassed by major currencies.

A major currency is based on representing an established measure; it is in this way an ‘extensive multiplicity’ – additional examples do not change the identity of the fiction underpinning the currency but conform to it. With additional examples of legal tender, national money or fiat currency, although exchange rates and ‘purchasing power’ might vary, and some local markets might ‘prefer’ US dollars or traders might wish to hold ‘safe-haven’ Swiss francs (money does not map conveniently onto territorial space), there is no change concerning what the multiplicity is. Each new example of a national or fiat currency reinforces the importance of nation states, state institutions, tax obligations and relevant transnational third parties as expressed in the way a state’s banking/financial system can draw credit from ‘their’ money or to collateralize the debt obligations that such currency arrangements imply. Instruments derived from a major currency can be innovative and productive but although depicted as depoliticised they are predisposed to preserve and augment the wealth of the most powerful interests that they serve (see Piketty, 2018: 547–553; De Soto, 2006: 675–714).

In contrast, a minor currency has no such pre-established measure; it is an ‘intensive multiplicity’ – additional examples add to the collective identity of the currency, transforming it and, more importantly, transforming what it can accomplish. With cryptocurrency (and also with complementary currencies and community currencies), each individual currency, digital asset system or altcoin, creates and explores a different structural identity of money. Examples include the following: Litecoin processes blocks four times faster than bitcoin to compete with banks, credit cards and related third parties such as PayPal; Ripple is designed for peer-to-peer debt transfer; Ether/Ethereum affords smart contract functionality and underpins digital derivatives; Digix Gold Tokens are commodity backed cryptocurrency; TrueUSD is a fiat-backed ‘stablecoin’ digital asset; Petro is a Venezuela government mineral reserves-backed cryptocurrency, requisite for government document services; Havven is a cryptocurrency-backed asset; Dogecoin and Coinye are examples of memecoins, which serve (in different ways) to contest conventional notions of backing, value or purpose; Central Bank Digital Currencies are state-regulated ‘digital banknotes’ providing confidentiality and inclusivity for the unbanked. The prospect of another imagined ‘currency community’ enables minor currencies to create opportunities to explore and address the implications of rethinking money derived from transformative systems, collectives, communities or other assemblages. In this way, a minor currency, as a creative process of becoming different or diverging from the abstract standard that defines ‘majority’ money, is also a fan-fiction of money, an unauthorised ‘user-generated’ intervention in currency to reimagine or repurpose money to change the narrative, consumption practices or redefine value in ways that do indeed go on from where Marx left off in developing a new political imaginary appropriate for our time.

With this distinction established, it is possible to return to Simmel’s assertion that money, and the methods of underpinning its value, continually evolve. By adapting to social need, money becomes more than a medium of exchange or an embodiment of the other qualities or characteristics of money, and instead is defined in terms of how it expresses inclusion and engagement within socioeconomic practices. Simmel argues that money inevitably tends towards abstraction in order to circulate more freely within the global economy. This might suggest, for example, that a major currency faces restrictions in crossing geopolitical frontiers, or operating in illicit markets while a more abstract minor currency flows in an unrestricted manner, but this is an oversimplification. Both major and minor currencies adapt in different ways to address different challenges. A major currency can attempt to appropriate some of the features of minor currency, such the US Federal Reserve partnership with IBM in developing a digital payments system or Wells Fargo and HSBC’s use of blockchain in the settlement process of cross-border payments, but these features remain restricted by the standards (and underpinning fictions) that define the major currency. Alternatively, a major currency could evolve by developing new financial instruments or new ways to use its existing leverage in ways that a minor currency could not. In contrast, a minor currency evolves speculatively and numerously in what amounts to a ‘theory-fiction’ of money in being able to simulate and possibly accelerate emerging transformations through their seductive potential and in the absence of alternative and appropriate money theorising. The fiction underpinning the value of a currency, major or minor, is thus not fake but is a constituent part of the currency itself: the fiction does not contain value but produces it (see e.g. Fisher, 1999: 5). The emergence and persistence of minor currencies: ‘demonstrates the importance of hype and bubbles for the development and diffusion of cutting-edge technologies …The development of a definite vision of the future—which generates hype and great enthusiasm that reduces risk-aversion and attracts new supporters and adopters—is driving the Bitcoin phenomenon’ (Huber and Sornette, 2020). One conclusion in addressing how the proliferation of minor currencies and related assets be understood within our field is to observe that minor currencies serve to innovate, transform and provide incremental improvements in the currency mix, establishing a monetary pluralism:

Bitcoin, and cryptocurrencies in general, are part of a diverse future for money. And monetary pluralism, arguably, is ultimately more likely to bring higher levels of systemic resilience, political openness and financial inclusion. (Dodd, 2018: 52)

An alternative conclusion is to imagine minor currency as a globally colonising currency. Nick Land, for example, argues that the status of bitcoin as money could hardly be more secure for such a purpose: it satisfies the transcendental qualities required of money, is highly divisible, communicable, fungibile, verifiable and automatically authenticated through a blockchain ledger, the most robust of digital technologies. These are precisely the characteristics sufficient to outmanoeuvre and replace central banking and third-party social institutions, and displace major currency, with transformational implications (Land, 2018). A minor currency need only demonstrate the effects of the superlinear growth-value of networks coupled with its general acceptability as a currency. In addition, a minor currency is free to leverage other types of collateral value – privacy, attention, waste, ownership, information, micro commodities, posing new – and contradictory – challenges for marketing, particularly on themes such as commodification (Gilbert, 2008), excess (Bataille, 1988) and the financialisation of daily life (Martin, 2002). And, of course, a minor currency is not limited to people, but has the advantage of being able to fully integrate with – and afford – complex socio-technological arrangements in ways that are tailored to emerging technologies, such as self-owning technologies (think of self-financed and self-driving taxis) or fully autonomous AI and other science fictions soon to become currency-craving fact. In contrast to an established major currency, which provides a measure for standardising (and immobile) monetary identity, a minor currency is unconfined, operating through an intensive multiplicity creating and transforming monetary possibilities. It is therefore the minor character of a currency that goes on from where Marx left off: it strives to accelerate the deterritorialisation of coding, serves as a vehicle to rupture the limit(s) of capital (and through which a post-capitalist tradition can materialise) and prefigures a new political imaginary that follows the lines of flight to their logical conclusion:

To go still further, that is, in the movement of the market, of decoding and deterritorialization? For perhaps the flows are not yet deterritorialized enough, not decoded enough, […] Not to withdraw from the process, but to go further, to “accelerate the process,” as Nietzsche put it: in this matter, the truth is that we haven't seen anything yet. (Deleuze and Guattari, 1984: 239–240)