Payment options on the (SF) frontier

[thrash]

Consider a science fiction setting with Traveller-ish technology -- specifically, no FTL comms other than ships themselves.

The setting is the very early days of interstellar exploration. Earth is not unified. Between the Outer Space Treaty and a bad "alien plague" scare early on, space-faring nations have largely decided to pass on formal colonization in favor of enforcing quarantine procedures and keeping an eye on each other. The gap is being filled by non-state agencies, mostly second-tier corporations with resources to invest but no other potentially high-growth options. The UN facilitates by selling licenses to develop (parts of) worlds, much like the International Seabed Authority does with deep sea mining.

At this point, operations are too thin on the ground to support an organized "sneaker net" of ships carrying data among the various licensed worlds. In particular, almost all traffic travels directly from the outposts to Earth (or rather, Earth's designated quarantine gateway system). There is very little travel across the frontier.

There are, however, freelance specialists who offer various services to the corporate colonies. Some of these are the usual camp followers -- food, drink, and entertainment -- but there are also private security contractors, professional services (engineers, etc.), and independent merchants and explorers. Many of these do travel from one colony to the next along the frontier in search of work.

How do these folks get paid, and pay for what they need?

Direct trade or barter can deal with many situations, of course, but has the same limitations it ever has. Hard currency is always an option, I suppose, but in the THS-lite home system I imagine this has fallen out of favor. One could substitute company scrip, but this has the very real danger of tying the independents to one corporation's holdings. There is also the problem of ultratech 3D printers and counterfeiting. Letters of credit are a traditional response, although they also suffer from the authentication problem.

Are there cryptologic solutions that might work well enough to discourage widespread or economically viable counterfeiting, yet still allow (mostly) anonymous transfers of purchasing power? Using Ultratech as an example, I can imagine a tiny, compact, printed computer the size and shape of a dollar bill, running some kind of self-authentication program with a large (~ GB) crypto key.

I'm opening the floor to suggestions. What do you think? What other possibilities are there?

[Mike Wightman]

A variation on bitcoins perhaps?

[David Johnston2]

Company scrip isn't inherently more problematic than other currencies. You just go to your friendly currency exchange and sell the scrip you can't use for scrip you can. Gold is gold. Can't fake it very well beyond adulterating it a bit. But the more modern approach is to use a hard-to-crack app on your phone that keeps track of what you get and what you spend and identifies itself as authentic licensed software.

[thrash]

Originally Posted by Mike Wightman

A variation on bitcoins perhaps?

As I understand it, bitcoin relies on an exchange of authentication and ownership data that would be difficult to manage with lags longer than the time between changes of ownership.

Originally Posted by David Johnston2

Company scrip isn't inherently more problematic than other currencies. You just go to your friendly currency exchange...

Back on Earth? That's not terribly practical. The setting is not at the point where there are banking and exchange facilities on the frontier separate from the corporations themselves.

The problem is whether Company B will accept the scrip you got from Company A as payment when you visit their outpost. Now, if the "scrip" were more like bearer bonds, it might be worth the risks for Company B to acquire some leverage over their rival.

Gold is gold. Can't fake it very well beyond adulterating it a bit.

There's something to be said for cash and coin, especially for "the payroll was on the ship that disappeared" type adventures.

But the more modern approach is to use a hard-to-crack app on your phone that keeps track of what you get and what you spend and identifies itself as authentic licensed software.

I'm having a hard time picturing a way to anonymize those transactions, however. It also requires a certain level of standardization (protocols, possibly hardware) that I'm not sure is justified in this case.

[David Johnston2]

Originally Posted by thrash

A
Back on Earth? That's not terribly practical. The setting is not at the point where there are banking and exchange facilities on the frontier separate from the corporations themselves.
.

I have trouble believing that nobody would set themselves up as a moneychanger if the corporations aren't doing it unless there's so little contact between the colonies that it doesn't matter your money is only good on your colony.

[Turhan's Bey Company]

I think there's going to be a division between in-system and interstellar currencies. Within a given system, there'll be the full range of digital currencies, company scrips, and all that sort of thing.

It's transferring value from one system to another that'll be an issue. A corp or government with a presence in multiple systems is likely to honor its centrally-issued currency, be it physical or electronic, everywhere it has a presence. If I've got a briefcase or wallet-chip full of Zaibatsu GmbH yenmarks, I'm likely to prefer traveling to systems where they've got operations. ZGmbH branches can have a sufficiently powerful computing infrastructure to handle in-system transactions and to verify ZGmbH currency/wallets/account records coming in from outside. A system with multiple space-corp presences is likely to see a local currency exchange market as well. If there are companies which provide transportation to multiple systems, they're likely to develop a banking arm which handles currency exchange. For a substantial fee, of course, to cover risks.

But the primary method of individuals carrying value from one to another is likely to be precious metals and similar valuables. Nothing else is going to be reliable enough. Cue the great wagon train to the stars robbery!

[thrash]

Originally Posted by David Johnston2

I have trouble believing that nobody would set themselves up as a moneychanger if the corporations aren't doing it unless there's so little contact between the colonies that it doesn't matter your money is only good on your colony.

That's pretty much the shape of it. This is very early in the process, and not intended to be a stable situation.

[tshiggins]

You could use an electronic version of the old, "Letter of Credit" (LOC) model. Contractors and other vendors receive payment good for a specific amount of the local currency, whatever that is. The LOC is fully negotiable and pays out to whomever has possession, as soon as it gets turned in for renumeration.

The party paid can take the letter, keep it safe, and then cash it in (maybe even with earned interest) at any time. However, because it's fully negotiable, the holder can trade it to anyone willing to swap. So, a merchant who just traveled to Dot from Eva holds a letter that promises payment in grotzits from Eva. Once he docks at Dot, he sees a good market opportunity in the local market, but needs local currency.

He can either go to a local colonial bank which (after fees and penalties) will give him 93 percent of the value. Not willing to accept such a deep discount, he checks the list of docked ships and finds one with the stated destination of Eva.

So, he rings up the captain, and she confirms that, yep, she has electronic credits in Dot ducats, and would willingly exchange some of them for the LOC, since that guarantees she'll receive face value once she reaches Eva. So, they grab some lunch and hash out a deal in which the captain of the second freighter pays 97 percent of the face value, in Dot ducats.

Now, the first merchant has the local currency needed to buy the long-legged roe for his trip to Bea.

[thrash]

Originally Posted by tshiggins

He can either go to a local colonial bank which (after fees and penalties) will give him 93 percent of the value. Not willing to accept such a deep discount, he checks the list of docked ships and finds one with the stated destination of Eva.

At this point, I must conclude that I haven't described the setting very well. So, let me try again:

This is the frontier. Everything is primitive, raw, and ad hoc. Outposts are company towns, mostly less than 30 years old and established for one purpose: profit. Shipping serves the needs of the corporations, and so runs from Earth's gateway to the frontier and back, not from one outpost to the next. Working the gaps in the system there are a small number of entrepreneurial types, who find ways to make themselves useful to the corporations but work hard to not simply get absorbed.

There is no colonial bank. There is the corporate pay office, which may offer some other financial services (investments, say, or funds transfers back to Earth) if corporate policy allows. There is a general store where you can rent a more-or-less secure lock box for your valuables. There is a combination of pawn shop and loan shark, owned by a former corporate employee who retired and cashed out, which keeps the workers in gambling stakes and beer money between paydays -- a strictly local establishment.

There is no list of docked ships, because there's only ever one ship in system at a time. Even if there were another ship, it would almost certainly be corporate-owned and officially Not Interested in business on the side. Even if you could convince someone on the corp ship to take the risk, the only time they cross paths with another corp is just a couple of jumps out from Gateway, where their routes converge, so they would have to carry the investment for weeks or months. Their funds are likely to be limited in any case, not able to cover the cost of (e.g.) even a minor starship repair at the corporate shop, no matter how large a discount you're willing to accept.

I like the idea of the PCs as independents, working with (but not for) the corporate outposts on the edge, seeing more and doing more than any corporate drone can imagine. I want a setting where even relatively ordinary characters routinely get involved in adventures, simply by virtue of being the only outsiders around. Where I got stuck was trying to figure out how they could get paid and pay for the goods and services they need, in the absence of all the usual trappings of a mature economy and without getting swallowed by one corp or another. I'm particularly interested in clever solutions available in an ultratech setting that don't have direct historical precedents.

[Johnny1A.2]

Originally Posted by David Johnston2

I have trouble believing that nobody would set themselves up as a moneychanger if the corporations aren't doing it unless there's so little contact between the colonies that it doesn't matter your money is only good on your colony.

This. If there's enough economic payoff in doing the cross-frontier stuff at all, there will be some kind of exchange, even if everybody deals in company scrip.

If John gets paid in Scrip A, but won't be back to planet A for a few years, and is on his way to Planet D, it's in his interest to trade his Scrip A to a newcomer from Planet D for Scrip D. Depending on circumtances, he might or might not have to take a hit on the value. If there's a middleman involved, and there likely will be if there are quite a few worlds and scrips and so forth, he'll take a cut.

But better 90 'dollars' of Scrip D that you can spend than 100 dollars of Scrip A you can't do anything with.

There'll also be some kind of exchange for whatever Earth uses for currency, too. The form it takes will depend on what Earth is using, and on the legality. The exchanges will exist whether legal or not, but the details will vary greatly depending on whether the exchanges are legal.