Earth Reserve Assurance (ERA): A Framework for Sound Money

Preamble:

Earth Reserve Assurance (ERA) offers a decentralized path to sound money. It can be incrementally adopted as an auxiliary function to any currency in a multi-currency system, without requiring a central reference unit or legislative reform.

Core, Part 1: Money Communicates Entitlements and Obligations

The term 'money' in many languages derives fr om the Proto-Indo-European term *moneyo-, a causative form of the root *men-, 'to think') meaning "to cause to think" or "to remind". As societies became more complex, money emerged as a quantitative mnemonic device for keeping track of social entitlements and obli­gations. J. M. Keynes explained on the first page of his Treatise on Money (1930) that ‘currency’ (Money-in-Trade) must communicate ‘worth’ (Money-of-Account). “Money Proper”, in its full sense, should fulfill the four axiomatic functions defined by W. Stanley Jevons (1876): a medium of exchange (trade), a store of value (accu­mulation), a measure of value (quantification), and a stable standard through time (stability). To the extent a currency fails any of Jevons’ four axioms, it loses some of its utility in keeping track of social entitlements and obligations.

Among monetary economists and central bankers there is a conundrum known as the “Mundell-Fleming Trilemma” (1960s), which laments that they must always sacrifice one of their three goals: fixed exchange rates, free capital flows, or monetary independence. Paradoxically, the loss of any one of these also erodes Jevons’ four axiomatic functions. To cope, central bankers sacrifice stability, or they give up their independence through a currency union or board, or they speak of Jevons’ axioms as mere guidelines.

Alternatively, the Earth Reserve Assurance (ERA) framework resolves this Jevons-Mundell-Fleming Paradox by restoring a dynamic Money-of-Account to Money-in-Trade. For any currency it enables the practical communication of mon­etary worth within and among regions, at any given time and through time.

This is accomplished by generalizing the functional logic of the world's first monetary system, that of ancient Sumer (circa 4500-1900 BCE), wh ere the value of silver was anchored to recent barley yields. This was the first embodiment of the sound money principles described 6,000 years later in Jevons' four monetary axi­oms, and Keynes' Money-of-Account principle.

Core, Part 2: The Ancient Sumerian Reference Model

The Sumerian monetary system offers a functional template for sound money. Silver served as Money-in-Trade, while a flexible but bounded amount of barley— the region’s foundational agricultural commodity—was the Money-of-Account. The value of silver was annually recalibrated to reflect the previous season’s barley yields, ensuring stability while adjusting to fluctuations in production. To calibrate the tangible worth of a standard barley-sized grain of silver, temple authorities would increase or decrease the size of a ‘handful’ of barley. Decentralized redeem­ability allowed debts denominated in the silver currency to be settled in barley when the debtor lacked currency, preventing deflationary crises during shortages. This method demonstrated all four of Jevons’ axioms: a fixed amount of silver for (1) trade and (2) accumulation; related to a bounded quantity of barley for (3) measur­ing comparative value in the market and (4) stabilizing market value through time.

Today Hungary's Arany Korona (AK) system demonstrates a Money-of-Ac- count tied directly to land productivity. This special-purpose valuation metric for agricultural and forestry lands uses rolling yield averages: 10 years for general agri­culture, 15 for vineyards, and 25 for timber lands. Market transactions occur in the Hungarian Forint (HUF) currency, but agricultural land prices are indexed to the AK, insulating farmland fr om HUF devaluation relative to foreign currencies. In a limited way, the AK shows how a 21st Century Money-of-Account anchored to the productive capacity of Land can coexist with a floating Money-in-Trade currency.

Core, Part 3: Listening to Ecosystems

The Earth Reserve Index of an Ecosystem (ERiE) measures productive capac­ity changes for each of the 108 IUCN-classified Ecosystem Functional Groups (EFGs). ERiE relies only upon data that is independently verifiable and method­ologically consistent across ecosystems and through decades.

Satellite imagery is used to monitor terrestrial and shallow water ecosys­tems for factors like biomass density, vegetation vigor, topsoil moisture, and metabolic activity. For each ecosystem type, data for ten 1 km² sites (separated by >100 km) are taken six times yearly, pulling 50 years of same­month historical data—yielding 3,000 total observations per ecosystem. Deepwater and sub­terranean ecosystems require proxy data (surface nutrient fluxes).

•       Market data for vari­ous types of metal, mineral, and energy reserves in the Earth, which humans depend upon, is obtained from declarations in regulated markets. This is sufficiently reliable when there are multiple sources, and legal penalties for false or misleading data.

Figure 1: The ERiE algorithm's curve rises steeply on the left, approaching high y-axis values asymptotically as the x-axis nears -80%, creating strong disincentives for degradation. In the middle range, the curve slopes moderately. On the right, it falls gradually, ending at a 45° angle (slope of -1) at +100%, to gently encourage further ecosystem enhancement.

Figure 1 illustrates how each indicator measures change from base year to present on two scales: degradation (0% to -100% ‘worst’) and enhance­ment (0% to +100% ‘best’). These are defined contextu­ally for each indicator through scientific understanding and stakeholder negotiation, updated every seven years. The 10-year rolling average for each indicator is converted to an index with a function that tailors the multivariate ERiE for use in the ERA framework, in a manner that dissuades ecosystem degradation and encourages restoration.

The Earth Reserve Index of a Currency (ERiC) links each currency’s unit worth to changes in the ecosystem integrity of its currency zone based on (1) the ERiE of each Ecosystem Functional Group; (2) the proportion of transactions using the currency in each country, and (3) the spatial extent of various ecosystems within those countries.

Core, Part 4: In Dialogue with Ecosystems

The ERA Framework introduces two regulated financial instruments:

•       GenERiC-dr (Generalized Earth Reserve Indexed Currency deposit receipts) provide a way to calibrate the worth ("Money-of-Account") of their des­ignated currency. Through a notary, an individual or entity deposits physical cash or digital tokens into a certified vault. The notary records the ownership in a dis­tributed registry, and issues the deposit receipt. The initial deposit amount for one GenERiC-dr unit is calibrated using the Protein-Equivalent Grain (PEG) method: For each currency’s country, it uses FAO data to determine the cheapest mix of three grains (most-traded domestic; most-traded imported; and most protein-ef­ficient) to produce 100 kg of bioavailable protein. Protein efficiency = (% protein content) x (bioavailability score). After this initial calibration, GenERiC-dr worth tracks the ERiC for that currency.

•       Earth Reserve Assurance deposit receipts (ERA-dr) support new money creation upon completion of projects that enhance long-term ecosystem capacity to produce primary commodities. Individuals or entities undertake projects that improve ecosystem productive capacity. Once the outcomes are demonstrated and the improvements are assured for 200 years (through resilient design, legal cove­nants, maintenance agreements, etc.) they offer ERA-dr stainless steel vouchers to the market. These are priced through a so-called ‘Dutch Auction’: the first 10% is sold via descending bids, and the final price sets the value for the remaining 90%. The aggregated value reflects the market’s perception of the project’s contribution to national income over the next 75 years, based upon the durability of the contri­bution. This aligns new money creation with tangible value-generation. Once they are issued, the ERA-dr are indexed to the ERiC for that currency.

The tradable deposit receipts are made of 304 stainless steel to endure against fire, flood, hurricanes, informatic obsolescence/failure, war, cyber-attacks, or solar flares. Rectangular with rounded corners, the 30, 35, 40, 45 and 50 mm lengths span five orders of magnitude in worth: 0.01[°], 0.10[°], 1.00[°], 10.0[^a], and 100.[°]. Each is laser-engraved with two 59-character hash IPFS CIDs: one for documen­tation that backs the issuance of the deposit receipt, and one for receipt validation, including its exact alloy composition veriable with LIBS or XRF devices. The elec­tronic registry accommodates anonymity wh ere this is legal for securities owner­ship, and also enables user-printable partial backups. Administrative costs include notary fees, voucher production, and vault operations.

Central banks are invited to redeem GenERiC-dr and ERA-dr during their normal open market operations to inject new currency into circulation. The ERA specification suggests that they purchase them with commemorative ‘sound money’ banknotes or electronic tokens that are similarly indexed to the ERiC of their currency zone. By this means, each central bank can incrementally transform its floating-value currency into stable money in the full sense of the term. These GenERiC-dr and ERA-dr would be stable reserve assets.

Expected Results: Monetary Reform Without Upheaval

A global shift towards Frederick Hayek’s vision of “Choice in Currency” (1976) is evident in initiatives like mBridge and BRICS Bridge. As yet, they lack a Mon- ey-of-Account framework. Veteran IMF economist John Williamson observed in 1977 that central banks had made: “in effect, a decision to learn to live with the non-system that had evolved out of a mixture of custom and crisis over the pre­ceding years.” (The Failure of World Monetary Reform, 1971-74. p. 73) Fifty years later, the international monetary non-system remains a technical, socio-economic, geo-political and philosophical challenge.

The ERA framework offers a practical approach to grounding a “Money-of-Ac- count” to changes to ecosystem productive capacity. Through market activity, its two instruments—GenERiC and ERA deposit receipts—offer a decentralized approach to aligning the value of currency with the underlying ecosystem changes in each geographical currency zone.

The conventional floating-value variant of a currency should continue to oper­ate alongside the stable ERA “sound money” variant of the same currency. Entities and individuals could then choose which they prefer to use for pricing, invoicing, and contracts. If deemed useful at the small and medium scale, GenERiC and ERA deposit receipts would proliferate through voluntary market adoption, which cen­tral banks can choose to redeem at their own pace, in their own way.

This requires normal regulatory oversight, but it sidesteps unattainable global agreements, legislative complications, and coercive mandates. It can scale organi­cally yet with the appropriate institutional reviews, including scrutiny of its poten­tial economic, social and political effects. Market demand would drive the requisite technical refinement and standardization of the essential data sources. Collabora­tive experimentation in diverse regions can adapt elements of the ERA framework to local legal, cultural, economic and ecological contexts.

ERA strengthens monetary sovereignty by offering a decentralized anchor and a practical pathway for the incremental conversion of any currency to sound money.