Encointer

Crypto UBI + Demurrage Protocol

Kusama/Polkadot parachain enabling communities to issue local currencies with built-in UBI and 50%/year demurrage. Uses physical proof-of-personhood ceremonies to ensure one-person-one-UBI.

Type	Crypto UBI + Demurrage Protocol
Region	Global
Status	Active
Links	Website

M69 Score

M69 Alignment3.6

Substantially aligned

1.02.03.04.05.0

Monetary Sovereignty3.8

Issuance (3x) + Stability (2x) + Fiat Indep. (2x)

Civilizational Durability2.9

Sovereignty + Governance + Resilience

Universal Adoption3.6

Traction (2x) + Inclusivity

Iss Mod3x

4.4

Stability2x

2.6

Fia Ind & Int2x

4.1

Traction2x

3.1

Sovereignty

3.3

Governance

3.2

Resilience

2.2

Inclusivity

4.7

Scored against the Money2069 Manifesto — see methodology. Higher = more aligned.

Key Findings

Strongest categoriesInclusivity (4.7) and Issuance Model (4.4) -- Encointer's UBI + demurrage + proof-of-personhood design is one of the most philosophically M69-aligned monetary architectures assessed. Equal issuance per person, 50%/year demurrage, zero fiat reserves, and active deployment serving underbanked communities in Tanzania make it a standout on the inclusivity and monetary design axes.

Fiat Independence (4.1)is a major strength: each community defines its own sovereign unit of account, the protocol has zero fiat reserves or collateral, no oracles or price feeds, and is structurally immune to fiat collapse. The multi-currency design natively supports "Global Standard, Local Expression" (M69 Commandment 8).

Traction is the critical weakness (3.1)with approximately 300-500 total active participants worldwide across a handful of communities, Encointer has not yet achieved meaningful scale. The 240% economic multiplier result from Tanzania is impressive but isolated. Business acceptance is limited (approximately 60-80 merchants globally). The unit-of-account usage within Zurich's Leu community is a bright spot.

Resilience is underdeveloped (2.2)the project has never faced a major crisis, has no formal stress-testing or disaster recovery plan, and depends on continued Kusama Treasury grants for funding. The proof-of-personhood design deliberately excludes AI agents, which is a philosophical strength but a resilience risk in an AI-dominant future economy.

Governance is promising but immature (3.2)the 1-person-1-vote democratic governance for community monetary parameters is capture-resistant by design and philosophically exemplary. However, protocol-level governance defers to Kusama, and the Encointer Association retains outsized influence during the bootstrapping phase.

The big takeawayEncointer is among the most conceptually M69-aligned monetary experiments in existence -- debt-free UBI issuance, aggressive demurrage, sovereign local currencies, proof-of-personhood Sybil resistance, and 1p1v democratic governance. Its Monetary Sovereignty pillar (3.8) is strong. But with fewer than 500 active users globally and untested resilience, it remains a promising prototype rather than a proven monetary infrastructure. The gap between its design excellence and its real-world impact is the central tension. Scaling the proof-of-personhood ceremony model to thousands of communities is the project's existential challenge.

Detailed Rating Breakdown

Framework v0.2-alpha · Rated 2026-04-10

Encointer is a Substrate-based system parachain on Kusama that enables communities worldwide to issue their own local digital currencies distributed as universal basic income (UBI). Every verified participant receives a fixed issuance per ceremony cycle (e.g. 44 LEU every 10 days in Zurich, 5 NYT per cycle in Tanzania), with Sybil resistance achieved through physical proof-of-personhood ceremonies where small, randomly assigned groups meet simultaneously at local high sun. All Encointer currencies feature nominal demurrage -- balances lose roughly 50% of their value per year -- which structurally prevents hoarding and funds the UBI mechanism. The protocol currently hosts active communities in Zurich (Leu, 200+ participants), Dar es Salaam (Nyota, 100+ participants), Green Bay (Wisconsin), and is expanding into Nigeria. From an M69 alignment perspective, Encointer demonstrates exceptional strength in issuance design -- debt-free, permissionless (anyone can bootstrap a community), tied to real human presence via proof-of-personhood, with elastic supply that contracts through demurrage and expands with population. Fiat independence is strong: currencies have their own sovereign unit of account (1 LEU = 1 CHF by merchant convention, not by backing), zero fiat reserves in the core protocol, and the system is structurally immune to fiat collapse. Inclusivity is outstanding through its UBI-by-design, demurrage-based anti-concentration, zero-cost participation, and active deployment in underbanked Tanzanian communities. However, traction remains very limited (a few hundred active participants globally), governance is in transition from association-led to community-democratic, the project has not survived a major crisis, and spending power stability has no explicit targeting mechanism beyond the demurrage-and-issuance equilibrium. The protocol represents one of the most philosophically M69-aligned monetary experiments in existence, but its real-world adoption and institutional maturity are still in early stages.

Issuance Model3x

4.4

Code	Question	Score
IM-01	Is issuance permissionless?Any community can register a new local currency on the Encointer parachain. Individuals participate by attending physical proof-of-personhood ceremonies. The Encointer Association currently manages community onboarding on mainnet to prevent geographic squatting during bootstrapping, but the protocol itself is designed to be permissionless. Semi-open with rule-based registration rather than discretionary gatekeeping. [1][2]	3
IM-02	Is new supply created through debt?Issuance is entirely debt-free. Participants receive fresh currency as UBI simply for attending proof-of-personhood ceremonies. No borrowing, no collateral, no repayment obligation. Pure seigniorage distributed equally to all verified individuals. [1][2]	5
IM-03	Is issuance tied to measurable real-world economic activity?Issuance is tied to physical human presence at ceremony meetups -- a form of real-world activity verification. The more people actively participate, the more money is issued, keeping supply proportional to the active local population. This is not a traditional economic index, but it algorithmically links supply to verified human economic participation. [1][2]	4
IM-04	Does the issuance model have a supply cap or hard ceiling?No hard cap. Supply grows with population and contracts through 50%/year demurrage. If community participation saturates, money issuance becomes constant and relative inflation decreases. The demurrage mechanism creates a natural equilibrium where supply adjusts symmetrically with economic participation. Elastic with built-in circuit breakers. [1][2]	5
IM-05	Can supply contract (burn/redemption) as well as expand?The 50%/year demurrage provides automatic, continuous, on-chain contraction of all existing balances. This is symmetric with expansion: supply grows through ceremony issuance and contracts through demurrage. Contraction is fully automatic and protocol-enforced, not user-initiated or governance-dependent. [1][2]	5

Spending Power Stability2x

2.6

Code	Question	Score
SPS-01	What mechanism does the protocol use to target spending power stability?Encointer uses demurrage (50%/year) combined with population-proportional issuance to maintain a supply equilibrium. This is a structural mechanism but does not explicitly target a price index or spending power metric. Stability emerges from the demurrage-issuance balance rather than from active price targeting. [1][2]	2
SPS-02	What benchmark is used to measure spending power?Communities can choose to notionally peg their currency to the national currency (e.g. 1 LEU = 1 CHF by merchant agreement) or to a basket of local goods. The Leu community in Zurich pegs to CHF by convention. This is a community-chosen reference with real merchant acceptance, structurally anchoring value to local productive capacity through issuance per active participant plus demurrage. [1][2]	4
SPS-03	How transparent and verifiable is the stability measurement?Issuance rate and demurrage parameters are enforced on-chain and fully transparent. However, there is no on-chain oracle or formal stability measurement system. The peg to CHF is a social convention among merchants, not a protocol-enforced mechanism. [1][2]	1
SPS-04	What is the protocol's historical deviation from its stability target?The Leu has maintained its 1:1 CHF peg by merchant convention since May 2022, approximately 4 years. However, this is a social peg, not a protocol-enforced one, and it has not been tested under serious economic stress. Limited live track record data available for deviation measurement. [1][2]	3
SPS-05	Does the protocol distinguish between short-term volatility and long-term purchasing power drift?Demurrage structurally addresses long-term purchasing power by preventing hoarding and maintaining circulation velocity. Communities can adjust the issuance amount and demurrage rate democratically. However, there is no explicit short-term volatility dampening mechanism. The distinction is structural but not intentional. [1][2]	2
SPS-06	Is the stability mechanism accessible globally?Any community worldwide can launch an Encointer currency, but meaningful participation requires physical presence at ceremony meetups in a specific geographic location. The system is globally available but locally bounded by design -- each currency is tied to a geographic area. [1][2]	3

Fiat Independence & Interoperability2x

4.1

Code	Question	Score
FI-01	What is the protocol's unit of account?Each community defines its own sovereign unit of account (LEU, NYT, etc.). The Leu is pegged to CHF by merchant convention but is not structurally defined by CHF. Communities are free to peg to a basket of local goods instead. The unit of account is own-defined but bootstrapped with fiat reference during the early phase for convenience. [1][2]	4
FI-02	What is the fiat composition of the protocol's collateral or reserves?The core protocol has zero fiat reserves or collateral. Currencies are minted from nothing as UBI. The Nyota community in Tanzania has a fractional reserve funded by grants (convertible to USDC), but this is a community-level add-on, not a protocol requirement. Core protocol is entirely fiat-free. [1][2]	5
FI-03	Does the protocol depend on fiat banking infrastructure to function?The core protocol runs entirely on-chain on Kusama as a system parachain. No banking relationships are required. The Nyota community's optional USDC conversion is a community-level feature, not a core protocol dependency. [1][2]	5
FI-04	Are the protocol's price feeds and oracles fiat-denominated?The protocol does not use price feeds or oracles. No external price data is consumed. Value is determined by community convention and local market acceptance. [1][2]	5
FI-05	What happens to the protocol if the primary fiat currency it references collapses or depegs?The protocol references no fiat currency at the protocol level. If CHF collapsed, the Leu community could simply re-peg to a different reference or a basket of goods by democratic vote. The core issuance mechanism (ceremony + demurrage) would continue functioning regardless of fiat events. [1][2]	4
FI-06	Does the project have a credible transition path from fiat-dominated adoption to fiat-independent operation?Encointer is designed as fiat-independent from inception. The optional fiat pegs (1 LEU = 1 CHF) are transitional bootstrapping aids. The protocol architecture supports communities choosing non-fiat benchmarks. However, the transition from fiat-referenced pricing to independent pricing has not been demonstrated in practice. [1][2]	4
FI-07	Can local or sectoral currencies be denominated in or settle against this currency?This is Encointer's core design. The protocol natively supports an unpermissioned set of many local currencies, each geographically bounded with independent valuation. Multiple independent local currencies already operate (Leu, Nyota, Green Bay). Each community can set its own parameters. However, there is no single base unit that local currencies settle against -- they are independent peers, not denominated in a shared standard. [1][2]	4
FI-08	Does the protocol define open standards for interoperability with other monetary systems?Interoperability is achieved through the Kusama/Polkadot ecosystem (XCM cross-chain messaging). The Nyota community enables USDC conversion within the app. However, there is no Encointer-specific open standard for cross-system monetary settlement or exchange rate discovery between different Encointer communities or with external systems. [1][2]	2

Traction2x

3.1

Code	Question	Score
TR-01	Is the project still active?Fully active. The Encointer parachain is operational on Kusama. Leu ceremonies continue in Zurich with 200+ participants. Nyota expanded to 100+ participants in Tanzania. Nigeria community launched. BeeDance feature introduced. Active GitHub development. April 2025 update published. [1][2][3]	5
TR-02	How long has the project been in existence?The whitepaper was published on arXiv in December 2019. The Encointer Association was founded in Zurich in 2020. The Kusama parachain launched in January 2022. Leu launched in May 2022. Approximately 4-6 years of continuous existence depending on the starting point. [1][2]	3
TR-03	How many active users does the project have?Leu Zurich has 200+ active participants. Nyota Tanzania has 100+ participants. Additional communities in Green Bay and Nigeria with smaller numbers. Total estimated active users across all communities: 300-500. This falls well below the 1K threshold. [1][2][3]	1
TR-04	How many businesses or organizations accept the project's currency?In Zurich, local businesses accept LEU. In Tanzania, 60 active entrepreneurs organized in 7 business groups accept Nyota. The total number of accepting businesses across all communities is likely in the 10-100 range. [1][2]	2
TR-05	Is the currency used as a unit of account?In Zurich, 1 LEU = 1 CHF by merchant convention -- goods are priced in LEU at participating shops. In Tanzania, Nyota is used as a medium of exchange among community members. There is limited but real unit-of-account usage within defined communities, though fiat denomination remains dominant outside the community. [1][2]	4
TR-06	Is the founder or core team still actively working on the project?Alain Brenzikofer remains the active founder and leads the Encointer Association based in Zurich. The team includes Christian Langenbacher, Anna-Lena Stach, Piero Guicciardi, and Malik El Bay (Dezentrum). Active public engagement continues with presentations and updates as of April 2025. [1][2]	5
TR-07	What partner organizations or institutions support or integrate the project?Key partners include Web3 Foundation (initial grants), Kusama Treasury (ongoing funding), Polkadot ecosystem, Jukumu and Chatafisha NGOs in Tanzania, MIT Solve (challenge submission), Dezentrum Think & Do Tank, and local community organizations. This represents 5-10 meaningful partners. [1][2]	4
TR-08	Is the project covered or recognized by credible external sources?Published arXiv whitepaper (academic preprint). Covered by Decrypt, CoinDesk, HackerNoon, Cointelegraph (author articles). Submitted to MIT Solve Financial Inclusion Challenge. NextBillion (development media) covered Tanzania pilot. Master's thesis on security analysis. Niche/specialist media coverage with some academic attention. [1][2][3]	3
TR-09	Is adoption organic -- not dependent on subsidies, incentives, or mandates?Mixed. The UBI issuance itself is an incentive to participate. The Nyota community was seeded with grant funding for its fractional reserve. However, within the communities, usage appears organic -- participants attend ceremonies voluntarily and spend at local merchants. The Zurich LEU community has grown organically without external subsidies. [1][2]	3
TR-10	What is the growth trend over the past 12 months?Moderate growth: Nyota expanded from launch to 100+ participants, Nigeria community launched, BeeDance feature introduced, democratic governance deployed on-chain. Leu community appears stable at 200+. Overall positive but slow growth trajectory. [1][2]	3
TR-11	Does the project have a coherent narrative and cultural identity that drives long-term commitment?Strong founding narrative rooted in UBI, local community empowerment, proof-of-personhood, and democratic governance. The physical ceremony gatherings create genuine community rituals. The tagline "Money by the people, for the people" conveys clear mission identity. Cultural artifacts include the common good parachain manifesto and the Encointer Book. However, the community remains small and the narrative has not achieved wide recognition. [1][2][3]	4

Sovereignty

3.3

Code	Question	Score
SO-01	Can any single entity shut down the project?Encointer is a system parachain on Kusama. Removal requires Kusama on-chain governance (referendum). No single entity can unilaterally shut it down -- it would require coordination of the Kusama validator set and governance token holders. However, Kusama governance could theoretically remove the parachain slot. A single entity cannot shut it down but a coordinated governance action could. [1][2]	4
SO-02	Is the project's core infrastructure permissionless and self-hostable?Fully open-source on GitHub (encointer-parachain, encointer-node, encointer-wallet-flutter, explorer). Anyone can run a collator node. However, the protocol depends on Kusama as the relay chain for shared security. The code is open-source and forkable, but the live system depends on permissioned infrastructure (Kusama). [1][2]	3
SO-03	Is the project subject to the jurisdiction of a single nation-state?The Encointer Association (Verein Encointer) is registered in Zurich, Switzerland. However, communities operate independently across multiple countries (Switzerland, Tanzania, USA, Nigeria). The protocol runs on Kusama which is globally distributed. Primary legal entity in one jurisdiction but operations are geographically distributed. [1][2]	3
SO-04	Does the project control or custody user funds?The Encointer Wallet app is non-custodial -- it keeps custody of users' private keys on their devices. No intermediary custodies funds. Users hold their own keys and can transfer funds directly. Fully non-custodial. [1][2]	5
SO-05	Is the project resilient to key-person risk?Alain Brenzikofer is the primary founder and visionary. The team is small (approximately 5 core members). While code is open-source and communities operate semi-autonomously, strategic leadership and protocol development are concentrated. His departure would materially impair the project. [1][2]	2
SO-06	Does the project depend on any third-party service that could be revoked?Critical dependency on Kusama relay chain for shared security and parachain operation. If Kusama governance revoked the system parachain slot, the project would need to migrate to a standalone chain or another relay chain. The dependency is on a decentralized network rather than a company, but it is still a meaningful third-party dependency. [1][2]	3
SO-07	Can the project be censored -- can specific users or transactions be blocked?No blacklist or freeze capability exists in the Encointer protocol. Transactions are processed by Kusama validators. The protocol is designed for privacy (TEE-based private transactions in the whitepaper design). No censorship capability at the protocol level. Peripheral services (wallet app, explorer) can be censored but are replaceable. [1][2]	4
SO-08	Does the protocol protect transaction privacy as a monetary right?The whitepaper explicitly proposes privacy-preserving transactions using TEEs. The paper describes "private transactions and purchasing-power adjusted fees." However, the current Kusama parachain implementation operates as a public blockchain with pseudonymous addresses. Privacy features from the whitepaper are not yet fully implemented on mainnet. Current state is pseudonymous. [1][2]	3
SO-09	Does the technology enforce the project's monetary rules such that governance cannot silently override them?Monetary rules (issuance per ceremony, demurrage rate) are encoded in the Substrate runtime on the Kusama parachain. Runtime upgrades require Kusama governance (on-chain referendum). Community-level parameters (issuance amount, demurrage rate) are set by community democratic vote (1p1v). Changes are visible on-chain. However, the runtime can be upgraded through governance without explicit separation of monetary vs. operational changes. [1][2]	3

Governance

3.2

Code	Question	Score
GO-01	How are decisions about the project made?Dual governance: community-level decisions (issuance amount, demurrage rate, spending reserves) are made by 1-person-1-vote democratic referenda among verified community members. Protocol-level upgrades go through Kusama on-chain governance. The Encointer Association handles operational decisions during the bootstrapping phase. Some formalized governance with inconsistent application across levels. [1][2]	3
GO-02	Who has voting or decision-making power, and how is that power distributed?Within each community, every verified participant has exactly one vote (1p1v). Proof-of-personhood ensures one-person-one-vote with no plutocratic advantage. This is a capture-resistant, broad-based participation model within communities. However, protocol-level decisions depend on Kusama governance (token-weighted). Community governance is exemplary; protocol governance is inherited from Kusama. [1][2]	4
GO-03	Is the governance process -- and the monetary mechanism itself -- transparent and publicly auditable?Community governance proposals and votes are on-chain and visible to all community members. The monetary mechanism (issuance, demurrage) is open-source and on-chain. Runtime upgrades go through public Kusama governance. Code is fully open-source on GitHub. Major governance actions are on-chain with supporting documentation publicly available. [1][2]	4
GO-04	Can governance be captured by a small group or hostile actor?Community-level governance uses 1-person-1-vote with proof-of-personhood, which is inherently capture-resistant -- you cannot buy extra votes. This is more resistant to plutocratic capture than token-weighted voting. However, with small communities (200 members), social engineering of a majority is feasible. [1][2]	4
GO-05	How are upgrades and changes to the protocol or project proposed and executed?Community-level: any member can propose changes, proposals are voted on using 1p1v with a sustained approval threshold. Protocol-level: runtime upgrades go through Kusama governance referenda. There is a structured proposal process at both levels. However, the Encointer Association retains significant influence during the bootstrapping phase. [1][2]	3
GO-06	Is there a separation between governance over monetary policy and governance over operational decisions?Community monetary parameters (demurrage rate, issuance amount) are governed by community 1p1v vote. Protocol-level operational upgrades go through Kusama governance. There is de facto separation: monetary policy is at the community level, protocol operations at the Kusama level. However, this separation is architectural rather than constitutionally enforced within communities. [1][2]	3
GO-07	Does the project have a constitution, charter, or set of immutable principles?The Encointer Common Good Parachain Manifesto articulates core principles. The whitepaper and Encointer Book document foundational values (equality, sovereignty, deliberation, information symmetry). These are published documents but are not formally protected from governance override or enshrined on-chain as immutable. [1][2]	3
GO-08	Can the project's issuance rules be changed, and are monetary policy changes subject to stronger constraints than operational changes?Community-level monetary parameters (issuance amount, demurrage rate) can be changed by community 1p1v vote, with a sustained approval threshold. Protocol-level issuance logic can only be changed through Kusama runtime upgrades (on-chain referendum). There is a de facto stronger constraint on protocol changes vs. community operational decisions, but no explicit constitutional protection distinguishing monetary from operational changes. [1][2]	3

Resilience

2.2

Code	Question	Score
RE-01	Has the project survived a major crisis or adversarial event?No documented major crisis, exploit, or adversarial event. The project has been live on Kusama since January 2022 (approximately 4 years) without a reported failure, but it has not faced a genuine stress test (market crash, regulatory attack, significant exploit attempt). Absence of crisis is not equivalent to survival. [1][2]	1
RE-02	Does the project have redundancy in its critical infrastructure?Kusama relay chain provides validator redundancy for block production. The Encointer wallet app is open-source and available on multiple stores (App Store, Google Play, F-Droid). Explorer is open-source. However, the Encointer parachain runs as a single system chain on Kusama with limited collator diversity. [1][2]	3
RE-03	Can the project recover from a catastrophic failure?All code is open-source. State is on Kusama blockchain. Community data (ceremony history, balances) is on-chain. A competent team could theoretically rebuild from public data and code. However, no formal disaster recovery plan is documented. The ceremony-based proof-of-personhood data would need to be reconstructed. [1][2]	3
RE-04	Is the project's design simple enough to be maintained and understood long-term?The core concept is elegant: attend a ceremony, receive UBI, balances decay via demurrage. This can be explained in a paragraph. The proof-of-personhood ceremony mechanics add complexity but are well-documented. The Encointer Book provides clear documentation. Moderate complexity with good documentation. [1][2]	4
RE-05	Is the project dependent on a specific technology that could become obsolete?Built on Substrate/Kusama, which is a major Web3 stack with active development. The Polkadot ecosystem is well-supported. Migration to another Substrate-based chain is possible. However, a move away from the Substrate ecosystem entirely would require significant redesign. [1][2]	3
RE-06	How does the project handle economic stress (bank runs, liquidity crises, collateral crashes, inflation/deflation shocks)?Demurrage structurally discourages hoarding, reducing bank-run dynamics. The fractional reserve model in Nyota provides some liquidity management. However, no explicit circuit breakers, dynamic parameters, or formal stress testing exist. The communities are too small to have experienced meaningful economic stress. Untested under real macro stress. [1][2]	2
RE-07	Does the project have sustainable funding for long-term maintenance?Primarily funded by Kusama Treasury grants. Also received Web3 Foundation grants. The Association received private donations and significant volunteer work. Past funding relied on appreciation of DOT and KSM tokens received as grants. No self-sustaining protocol fee revenue. Reliant on continued treasury grants. [1][2]	2
RE-08	Can the system operate across extreme latency, disconnected networks, and multi-century timescales?Encointer's design inherently supports logical decentralization -- communities can continue independently even if cut off from each other. The whitepaper notes it "could even continue to exist in countries that eclipse their citizens from the internet." However, ceremony coordination requires connectivity at specific times, and the Kusama dependency assumes standard internet. The core concept is technology-agnostic and portable. [1][2]	3
RE-09	Is the system designed for a world where AI agents are primary economic actors?The proof-of-personhood ceremony explicitly requires physical human presence. AI agents cannot attend ceremonies or obtain identity. The system is deliberately designed for human participants only. Machine participation in issuance is impossible by design. However, AI agents could hold and transact existing tokens through standard blockchain interfaces. [1][2]	2

Inclusivity

4.7

Code	Question	Score
IN-01	Can anyone in the world participate regardless of nationality, wealth, or status?Open to anyone anywhere who can form a community of sufficient size in their geographic area. No nationality restriction, no wealth requirement, no credit check. The only barrier is having a smartphone, internet access (periodic), and enough local people willing to participate. Active in both wealthy (Zurich) and underbanked (Tanzania) communities. [1][2]	4
IN-02	What is the minimum cost to start using the project?Zero cost. The Encointer Wallet app is free to download. No minimum balance required. Ceremony participation is free. Kusama transaction fees are negligible (sub-cent as a system parachain). UBI tokens are received just for attending a ceremony. [1][2]	5
IN-03	Does the project actively serve underbanked or financially excluded populations?Designed specifically for financial inclusion. Actively deployed in underbanked communities in Dar es Salaam, Tanzania (Nyota). The Tanzania pilot multiplied economic impact of aid by 240%. Expanding into Nigeria. MIT Solve Financial Inclusion Challenge submission. The project explicitly targets financially excluded populations. [1][2]	5
IN-04	Does the project distribute economic benefits -- including seigniorage -- broadly, or concentrate them among insiders?Seigniorage is distributed equally to all ceremony participants as UBI. Every verified person receives the same amount. No insider advantage in issuance. No founder allocation, no VC tokens. The Encointer Association receives treasury grants for development but does not capture seigniorage from communities. Demurrage redistributes value from holders to future minters. [1][2]	5
IN-05	Does the project treat all participants equally under the same rules?Identical rules for every participant within a community. Same issuance per ceremony, same demurrage rate, same voting power (1p1v). No tiered access, no preferential rates. The proof-of-personhood ensures no one can claim more than one share. Perfect equality by design. [1][2]	5
IN-06	Does the project require identity documentation or surveillance to participate?No government ID, no KYC, no biometric verification. Identity is established through physical presence at proof-of-personhood ceremonies. The app requires a phone number or no identity at all for basic functions. Pseudonymous participation is the default. The privacy paper proposes TEE-based transaction privacy. However, the ceremony attendance creates a social mapping of who knows whom. [1][2]	4
IN-07	Does the project have mechanisms to prevent wealth concentration over time?50%/year demurrage is an extremely strong anti-concentration mechanism. Combined with equal UBI issuance per person, the system structurally converges toward equality. This is among the strongest wealth concentration prevention mechanisms of any monetary project. Textbook UBI + demurrage anti-concentration. [1][2]	5

Frequently Asked Questions

What is Encointer and what problem does it solve?

How is money created in Encointer?

Any community can register a new local currency on the Encointer parachain. Individuals participate by attending physical proof-of-personhood ceremonies. The Encointer Association currently manages community onboarding on mainnet to prevent geographic squatting during bootstrapping, but the protocol itself is designed to be permissionless.

How does Encointer maintain stable spending power?

Encointer uses demurrage (50%/year) combined with population-proportional issuance to maintain a supply equilibrium. This is a structural mechanism but does not explicitly target a price index or spending power metric. Stability emerges from the demurrage-issuance balance rather than from active price targeting.

Is Encointer independent from fiat currencies?

Each community defines its own sovereign unit of account (LEU, NYT, etc.). The Leu is pegged to CHF by merchant convention but is not structurally defined by CHF. Communities are free to peg to a basket of local goods instead.

Who controls Encointer and can it be shut down?

Encointer is a system parachain on Kusama. Removal requires Kusama on-chain governance (referendum). No single entity can unilaterally shut it down -- it would require coordination of the Kusama validator set and governance token holders.

How widely adopted is Encointer today?

Leu Zurich has 200+ active participants. Nyota Tanzania has 100+ participants. Additional communities in Green Bay and Nigeria with smaller numbers.

Is Encointer still active and growing?

Fully active. The Encointer parachain is operational on Kusama. Leu ceremonies continue in Zurich with 200+ participants.

What are the main risks or weaknesses of Encointer?

Weakest category: Resilience (2.2).

What makes Encointer unique from an M69 perspective?

Strongest categories: Inclusivity (4.7) and Issuance Model (4.4) -- Encointer's UBI + demurrage + proof-of-personhood design is one of the most philosophically M69-aligned monetary architectures assessed. Equal issuance per person, 50%/year demurrage, zero fiat reserves, and active deployment serving underbanked communities in Tanzania make it a standout on the inclusivity and monetary design axes.

How is Encointer's M69 Score calculated?

Encointer scores 3.6/5.0 overall. Pillar scores: Monetary Sovereignty 3.8, Civilizational Durability 2.9, Universal Adoption 3.2. Strongest: Inclusivity (4.7). Weakest: Resilience (2.2).