Sporting a plethora of brilliant attributes and a track record of several world firsts in the sphere of new currencies, the Ven has been an issue of inspiration and discussion far afield. As with most currencies, user stories often illuminate as much of the currency design and mechanisms as driving a car illuminates about engineering. With the Ven, much of the language shared with many other community currency solutions has produced some level of identification and, by the same token, confusion, particularly for those interested in what´s under the hood of currency design mechanisms. Iconically, this even extends to the name and identity of its issuing company “Hub Culture Ltd.” and their local event-pavilions called (pop-up-)”Hubs” which are often mistaken for the league of co-working spaces also called Hubs under the umbrella of www.the-Hub.net for which I was working in 2010/11. (The two being ever more convoluted, since a Hub Culture Pavilion is now based at “the-hub” in Westminster, London.)

Last year, Matthew Slater and I met with Stan Stalnaker, Founding Director of Hub Culture and the Ven, to clarify some recurrent questions we had encountered about this currency.*

Here is a brief harvest of the what´s available about the Ven online and some additions from the interview.

Some history:

– Hub Culture was founded in 2002, following publication of a book by Stan Stalnaker that explored the emergence of social globalization.  In November 2002 HubCulture.com emerged as one of the world’s first specialized online social networks, with events and activities.

– The first iteration of Ven was launched 4 July 2007 as an unpegged currency to acknowledge exchanges in terms of “good karma” on Facebook using an early custom-made Facebook application.

– in late 2008 Ven was relaunched outside of Facebook on the revitalized platform at HubCulture.com, with a fixed exchange rate of 1$=10Ven, an online store and the possibility of direct P2P transfers.

– Since 2007 Ven was accepted at temporary pavilions (pop-ups) for usage-fees, rental and merchandise and since 2009 at Hub Culture´s first fixed Pavilion in London.

– Since 2010 the value (buying rate) of Ven had been pegged to a pricing-basket of currencies and commodities, with over twenty components in the basket. The composition and weightings of the basket are not made public, but include the currencies Dollar, Euro, Renminbi, Yen, Real, Dirham, HKD and gold, silver, oil, soy as well as carbon futures.

– Since 2011 Ven accounts are accessible through an API and again available through Facebook.

Value of Ven and Value-Creation through Ven:

– Since the composition of the pricing-basket is not disclosed it can only be approximated from the varying exchange rates of the Ven against other currencies, which is exclusively calculated by Thompson Reuters. According the Stan Stalnaker, the percentage of currency in the basket outweighs the commodity components with agricultural staples being the least component only followed by carbon offset futures.

– Ven is issued by Hub Culture Ltd. and can be bought online using credit-card or paypal transfers. Ven is not readily redeemed for national currency by Hub Culture Ltd (except by retail partners, see below). However third party resale is theoretically unrestricted.

– Ven in circulation are backed by the held assets Hub Culture Ltd. and actively priced in real time relative to the basket described above. This does not mean that Hub Culture holds assets in the same composition and proportion as the basket – just the same relative value. According to Stan Stalnaker, Hub Culture instead holds a mix of Dollar, Euro, £,  HKD, gold and carbon assets equal to the amount of Ven in circulation with its banking partners, and with a small volatility cushion included. As the value of circulation grows, it is expected that Hub Culture will hold more completely the exact component reserves, and there is no plan to move away from the 100% backing policy.

–  For it´s users/buyers the value of Ven resides in the ability to purchase products and services through the online-store of Hub Culture Ltd., which in turn purchases the merchandise from their partners and suppliers. Also, Hub Culture provides some own services for Ven at the mentioned local Pavilions.

– According to an article by Stan Stalnaker from January 2012, over $100 million in assets were then available on HubCulture.com for Ven, aiming to hit $800 million by the end of 2012.

– Surprisingly, merchandise doesn´t seem to be any cheaper in the Hub Culture online store when compared to conventional online retailers, so the use value must lie in network effects and low transaction costs. There is currently no charge for transferring Ven.

– In 2011, two large commodity deals were priced (but not paid) in Ven: one carbon credit deal and one gold-extraction future contract.

– To facilitate use and adaption of the Ven, retail partners who except Ven for their products can claim back conventional currency from Hub Culture Ltd.

– different descriptions about the use and turnover of Ven can be found. In 2010 it was mentioned on CNN that “1.2 million units circulate the globe”. In 2011 Stan estimated that 5 million Ven had been bought and, shortly after purchase, spend on merchandise since 2008, at the time of review of this article, May 2012, this figure was said to have risen to 8 million units of Ven expecting to top 10 million by the end of the year.

– Last year, transactions worth less then $2 made me one of the top five users in the Ven ranking, this year (May) a $3 transaction ranked me #6. This reflects the little use of Ven for “peer-to-peer” exchanges on HubCulture.com, because online and offline purchases from Hub Culture Ltd are not reflected in the ranking.

In effect:

– Pricing in Ven, especially for future contracts, means pricing on a broader risk base than in any one currency or commodity, which offers advantages for large speculative deals that wish to hedge such risks.

– Using an analogy offered by Stan, this makes the Ven comparable to a virtual ETF (Exchange Traded Fund), with shares that can be passed on between two accounts on hubculture.com without transaction costs

– the smart and compelling placement and marketing of the Ven proves that currency innovations are news-worthy (see Hub Culture press-selection) far beyond the grass-root movements

*Interview, 28th April 2011