Space Currency

Don’t Worry, We’re Ready for Commerce in Space


A scene from the film “Things to Come,” directed by William Cameron Menzies and based on a novel by H.G. Wells, circa 1936

Photograph by Henry Guttmann/Getty Images

A scene from the film “Things to Come,” directed by William Cameron Menzies and based on a novel by H.G. Wells, circa 1936

The implications of space travel have long set the brains of nerds racing. What are the implications of faster-than-light travel? How best to terraform Mars? Will a corporate space grab leave us all to wither away in lunar dystopias?

And, of course, how will we regulate commerce?

The latter may seem like the theme of the most boring science fiction novel ever written, but PayPal (EBAY) on Thursday said it’s launching a project to ask the basic questions that might arise from economic exchanges outside the earth’s atmosphere. The system, called PayPal Galactic, will probably provide less insight into the future regulatory framework of the heavens than it will into the strange fantasies that make Silicon Valley billionaires tick (see Singularity, the.)

The company certainly put on a good show, bringing together a handful of scientists and Buzz Aldrin, who has actually been to space (although, as far as we know, he never bought anything there). PayPal declined to say how much it’s invested in the project, however. More fundamentally, when it comes to commerce there don’t seem to be any space-specific issues. Just to be sure, we asked Frans von der Dunk, a professor of space law at the University of Nebraska College of Law. Isn’t this field crowded enough already without Johnny-come-latelies like PayPal making us reexamine the legal system of the universe?

There’s an existing treaty that maintains space as no man’s land, meaning no single nation can impose its currency, he said. But the practical solution is pretty easy. “If a U.S. astronaut wants to sell something on Mars to a Russian, if the latter accepts dollars, the deal could be made,” according to Von der Dunk. “If not, the former might have to come up with rubles or another currency the latter finds acceptable—but existing currencies for the time being would certainly suffice.”

Of course, if colonies began breaking away from earth’s governments, they might start developing their own legal and regulatory frameworks. Said Von der Dunk in an e-mail:

“Only once real colonization of outer space would start taking place, as a corollary of the question whether this would give rise to non-terrestrial new states (a bit like the U.S. pried itself loose from the motherland on the other side of the ocean once loyalties had worn too much and simple power could no longer enforce such loyalty), might the question arise in earnest whether a new (space) currency would be necessary—and doable.”

In the meantime, the problems of space currencies seem a lot like those which virtual currencies are intended to solve. “Someone with an M-Pesa balance on SMS in Kenya cannot buy something online from a merchant in the United States,” says Chris Larsen, the founder of Ripple, a virtual currency system designed for earthbound commerce. Ripple is based on creating a ledger that can facilitate smooth transactions between people using different currencies, he says. There’s no reason why such transactions would be any different in zero gravity.

Well, one. Systems like this take a lot of computing power, and there’s very little Internet in space. There is some: NASA has been providing its astronauts with Internet connectivity for several years, although a spokesperson for the agency acknowledged that providing many more than a half-dozen people with this service is beyond anything in its current plans.

Brustein is a writer for Businessweek.com in New York.

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