Swapping and the Peer-to-Peer Payoff

Nick Negroponte on swapping and the peer-to-peer payoff from InformationWeek:

A parallel and more intriguing form of trade in the future will be barter. Swapping is a very attractive form of exchange because each party uses a devalued currency, in some cases one that would otherwise be wasted. Many of us are too embarrassed to run yard sales or too lazy to suffer the inconvenience and indignity of eBay. But imagine if you weren’t. The unused things in your basement can be converted into something you need or want. Likewise, the person with whom you’re swapping is giving something of value to you which is less so to them. With minimal computation, three-way, four-way, and n-way swaps can emerge, thereby removing the need for any common currency.

Swapping is extended easily to baby-sitting for a ride to New York, a mansion for a two-hundred-foot yacht, or leftover food for a good laugh. In some cases, people will swap for monetary or nonmonetary currencies. Without question, we’ll see new forms of market-making and auctions. But the most stunning change will be peer-to-peer, and peer-to-peer-to-peer- … transaction of goods and services. If you fish and want your teeth cleaned, you need to find a dentist who needs fish, which is so unlikely that money works much better. But if a chauffeur wanted fish and the dentist wanted a driver, the loop is closed. While this is nearly impossible to do in the physical world, it’s trivial in cyberspace. Add the fact that some goods and services themselves can be in digital form, and it gets easier and more likely. An interesting side benefit will be the value of one’s reputation for delivering on your promises–thus, identities will have real value and not be something to hide.


  1. BUT…people use a currency to assess the viability of a swap. Inherently we know a swap is viable mostly due to the parity of currency values.