Nigel Dodd

This paper challenges the notion that Bitcoin is ‘trust-free’ money by highlighting the social practices, organizational structures and utopian ambitions that sustain it. At the paper's heart is the paradox that if Bitcoin succeeds in its own terms as an ideology, it will fail in practical terms as a form of money. The main reason for this is that the new currency is premised on the idea of money as a ‘thing’ that must be abstracted from social life in order for it to be protected from manipulation by bank intermediaries and political authorities. The image is of a fully mechanized currency that operates over and above social life. In practice, however, the currency has generated a thriving community around its political ideals, relies on a high degree of social organization in order to be produced, has a discernible social structure, and is characterized by asymmetries of wealth and power that are not dissimilar from the mainstream financial system. Unwittingly, then, Bitcoin serves as a powerful demonstration of the relational character of money.

Response to Hau Book Symposium on Dodd, Nigel. 2014. The social life of money. Princeton, NJ: Princeton University Press.

Although Nietzsche rarely features in discussions of money, he offered important insights into such matters as the relationship between the money economy and the permanent decadence of modernity, money’s impact on social hierarchy and individualism and the moral economy of debt. His remarks on these themes are closely connected to two of his best known, but controversial, ideas: the eternal return and the Übermensch. In this paper, I explore how Nietzsche’s arguments, and these two concepts in particular, have been taken up by three thinkers who have made distinctive and original contributions to the sociological and philosophical understanding of money, credit and debt: Georg Simmel in The Philosophy of Money (1907), Walter Benjamin in ‘Capitalism as Religion’ (1921), and Norman Brown in Life Against Death (1959). Nietzsche’s ideas fulfil a pivotal role in each of these treatments of money: in particular, he informs Simmel’s exploration of the relationship between money, individualism and socialism; Benjamin’s examination of the ‘guilt history’ of modern capitalism and its moral economy of debt; and, finally, Brown’s explorations of the roots and consequences of our neurotic money complex. Each of these thinkers puts a different complexion on Nietzsche’s own thoughts regarding money, as well as his broader philosophy. Nevertheless, he provides all three thinkers with a sharply critical perspective on the idea that money’s expansion in the modern world reflects the individual’s liberation from traditional social ties and ancient moral bonds.

This article explores the notion of ‘perfect’ money that Simmel introduces in The Philosophy of Money. Its aim is twofold: first, to connect this idea to his more general arguments about the nature of society and the ambivalence of modernity, and, second, to assess its relevance for contemporary debates about the future of money, especially following the global financial crisis. I argue that Simmel’s concept of perfect money can be understood as utopian in two senses, conceptual and ethical, that correspond to the two interpretations he develops, in Soziologie, of the idea of a perfect society. This sheds light on an aspect of Simmel’s writings that has attracted relatively little attention, namely his views on the relationship between money and socialism. Characterizing this relationship as a ‘formal affinity’, his remarks resonate with a long tradition of thought on monetary utopias that aim not for the abolition of money but its radical transformation as a means of improving society. This tradition is coming to the fore once again today, as the financial crisis has given new impetus to constructing forms of money – for example, LETS, Time Dollars, mutual credit, peer-to-peer lending and digital currencies such as Bitcoin – that provide viable alternatives to big banks. Understood in conjunction with his account of the ‘tragedy’ of individualism in modernity, such resonances demonstrate the enduring relevance of Simmel’s work to the empirical and theoretical investigation of money.

This paper explores an essential but neglected aspect of recent discussions of the banking and financial system, namely money itself. Specifically, I take up a distinction drawn by Susan Strange which has never been fully elaborated: between a financial system that is global, and an international monetary system that remains largely territorial. I propose a sociological elaboration of this distinction by examining each category, ‘finance’ and ‘money’, in terms of its distinctive orientation to risk and debt. Money is distinguished by its high degree of liquidity and low degree of risk, corresponding to expectations that derive from its status as a ‘claim upon society’– a form of socialized debt. But as Strange argued, these features of money are being undermined by the proliferation of sophisticated instruments of financial risk management –‘strange money’– that, as monetary substitutes, both weaken states' capacity to manage money, and more broadly, contribute to ‘overbanking’. The ultimate danger, according to Strange, is the ‘death of money’. The paper concludes by exploring the implications of the distinction for sociological arguments about the changing nature of money.

Recent work by sociologists, geographers and anthropologists has drawn attention to the “de-territorialization” of money, and to the emergence of “alternative” monetary forms such as e-money and complementary currencies. The increasingly diverse nature of these forms raises doubts as to whether “money” is a sufficiently coherent entity to be covered by a single definition. In this paper, these doubts are explored through a critical evaluation of the work of four prominent scholars of money: Cohen, Ingham, Zelizer and Hart. I argue that, despite their empirical richness, these approaches are undermined by a number of conceptual confusions: for example, by a tendency to refer to “money” and “currency” as if they were synonymous. The paper concludes by suggesting that Simmel’s “pure concept” of money provides the most promising basis on which to develop an analytically rigorous treatment of money which can embrace the variety of forms which circulate today.

This paper offers much-needed analytical refinement to the sociology of money. I argue that we need to develop a conceptual vocabulary that enables us to take account of two apparently conflicting trends in the world's money flows. While state-issued ‘currency’ is undergoing a process of homogenization, ‘money’ in a generic sense is diversifying through the rapid growth of new monetary forms. I move on to suggest that all forms of money (some currencies, others not) should be regarded as dual: as monies of account and as monetary media. This dualism sheds new light on a monetary form that sociologists have either ignored or misunderstood, namely the euro. It enables us to conceive of the euro as a highly unorthodox, or hybrid, currency. Moreover, it suggests that, by virtue of this unorthodoxy, the euro zone represents a special case of currency homogenization that may actually stimulate monetary diversification.