by Joe Orlow, Softwine Market, Asst. Market Manager
Softwine Market provides information and guidance for local, sustainable businesses.
Cryptocurrency is a financial tool for suburban agriculture (sub-ag) companies and their customers that can help build a strong local economy.
This article explains what crytocurrency is and how it is integrated into the Softwine Market Digital Pushcart. The article serves as an illustration for other businesses how to incorporate, and benefit from, cryptocurrency.
Where can cryptocurrency be used?
The dollar is a currency used in the U.S. The peso is a currency used in Mexico.
Dollars can be converted to pesos, and vice versa. Someone from the U.S. visiting Mexico may buy pesos with dollars; and when they return from Mexico, they can convert unspent pesos back to dollars.
What place, then, uses cryptocurrency? Cryptocurrency is currency that has the potential to be used anywhere there is Internet access.
Cryptocurrency can be used to buy products from the Softwine Market Digital Pushcart. To understand how that works, let’s dig down to analyze the concept of money.
Money is a value storage device.
A tomato is not money. But it can be a temporary value storage device. For example, say a gardener grows a tomato. The tomato stores the value of the labor and resources that went into producing the tomato.
Now, say that the the gardener wants a cucumber. He can give the tomato to a fellow gardener, with its associated stored value, and receive in return a cucumber. This is called bartering.
But what if the tomato is ripe this week, and the cucumbers won’t be ripe to be picked until next week? One way around that difficulty is to use a precious metal as an exchange device.
A miner obtains the precious metal — say, silver — from the ground; a refiner purifies it; a coiner coins it. The silver coin thus contains the value of the labor and resources of the miner, refiner, and coiner.
So, the cucumber farmer can give a silver coin (with its stored value) to the tomato farmer, who gives him a tomato (with its stored value) in return. The next week, the tomato farmer can exchange the same coin for a cucumber.
This is the familiar process of buying and selling by exchanging money for products and services.
The transaction works with any currency. The coin can be a coin based on the dollar currency. It can be a coin based on the peso currency. It can be a cryptocoin based on cryptocurrency.
Why bother with cryptocurrency?
Dollars work fine for running the economy. Why should customers at the Digital Pushcart buy crypto to use for buying produce there?
To answer that, let’s investigate why we use banks.
One advantage of involving banks in financial transactions is that people don’t have to carry around a lot of cash. Cash can get easily lost or stolen. Credit and debit cards allow people to use their money without having to carry it around.
There is a cost involved in providing this convenience. Banks charge businesses for credit and debit card transactions. That is, when a customer pays a business for a $5 product or service with cash, the business gets the full $5. But when a customer uses a debit or credit card, the business gets something less than $5.
There are ways to use cryptocurrency that simulate a credit or debit card transaction, but without involving a bank.
Thus, crypto allows the Digital Pushcart to do business without involving a bank at the time of the transaction. (Banks may be involved, however, at the first stage of buying crypto and at the last stage of converting crypto back to dollars.)
This can be desirable, for reasons that will be spelled out later.
In a typical credit or debit card transaction, the vendor pays any associated fees. In a typical crypto sale, however, both the vendor and the customer share the burden of the associated fees. However, Softwine Market has developed a system so that the customer does not shoulder any fees.
Cryptocurrency does for money what the internet did for news: it cuts out the middleman. In the case of news, the middlemen were the professional reporters, editors and publishers of the mainstream media. Now, anyone, through their use of social media, can become a broadcaster.
With cryptocurrency, it’s the banks that are marginalized.
What are the technical details of cryptocurrency?
Historically, a dollar was backed up by silver or gold and could be exchanged for an amount of silver or gold that was, by definition, worth a dollar. Nowadays, the dollar is a fiat currency, which is a cute way of saying that a dollar has value because experience tells us the economy functions as long as the population and the government agree that the dollar has value. Fiat means “decree”. The government has decreed the dollar has value.
Cryptocurrency is mathematically “mined” and implemented with Internet connected computers. Transactions are kept in a ledger called a blockchain.
Users can buy crypto with dollars, buy products with crypto, and convert crypto back to dollars as it suits them.
How do I buy and use cryptocurrency?
We suggest beginners use the Coinbase Exchange as the gateway to crypto use.
Coinbase allows you to buy, spend, and accept crypto. To set up and use Coinbase, it is helpful to have the following:
-a smartphone with an updated operating system
-internet wireless service and phone service on that smartphone
-an email account accessible from that smartphone
-a bank account with online banking
-a valid government identification.
What is the Softwine Market Digital Pushcart?
Pushcarts are found throughout the world and history. A while back, there was a farmer who would sometimes drive his vegetable laden truck through the suburban Takoma Park neighborhood where I lived. His sing-song “Tomatoes! Tomatoes!!” alerted suburbanites to come out and buy his fresh produce. Here in Kemp Mill, an ice cream truck, comes through from time to time. Vegetable trucks and ice cream trucks were the logical development of pushcarts.
The Digital Pushcart sends you alerts via text or email about fresh produce available at local farmers markets. You can purchase the produce online, and then pick it up locally that day in your neighborhood. Thus, the Digital Pushcart you to buy produce from a farmers market, even if you can’t make it in-person to the market.
The farmers markets are generally open one day a week for around four hours.
I am assistant market manager at Softwine Market. I go to some of these local markets to buy produce.
Let’s consider the Crossroads Farmers Market. I go to the market when it opens and survey what is being sold there. I take pictures and descriptions and upload that information to the Digital Pushcart webpage. I then send out texts and/or emails to people who have signed up for Digital Pushcart notifications.
These people can then order the food they want. I then bring it back to Kemp Mill where it is available to be picked up that evening.
I also bring back a little extra for those who did not pre-order.
Customers can pay for the produce using cryptocurrency. The customer goes online to the Coinbase Exchange and puts in the amount they are paying and the email address for the Digital Pushcart which is firstname.lastname@example.org. We also accept PayPal payments under some circumstances.
For those who didn’t pre-order, they have the option also of paying using the Coinbase app. The produce will have a card with a QR code on it. The customer can point their phone at the QR code and enter the amount for the purchase.
For those who want to help those in need in the community, Softwine Market will be crowd funding donations. That is, collecting small donations to pay for produce for those in need. For example, fifty people might pledge $1/week of crypto for families with limited food budgets.
When possible, I will try to get discounts for customers. For example, leftover produce at markets is not generally reduced in price. The logic behind that is explained in this article.
However, vendors may be willing to give a bulk discount. For example, if I get enough orders for tomatoes, I can try to negotiate a bulk discount for the tomatoes.
We offer delivery food to homes within a limited radius of the produce pickup location. Also, we can arrange “carpools” to have others deliver your produce to your home.