Individual SCAOs will have slight variations in design depending on each use case, but central to the SCAO system is a liquid democracy governance system along with 2 digital assets: the Hard Asset token and the Liquid Asset Token.

Necessary Economics Background:

(Vastly oversimplified) in today’s economic theory debate we see 2 main schools of thought: Austrian and Keynesian.

Generally speaking, the Austrian approach emphasizes stimulating supply, the actions of individuals, their psychology, economic marginalism, opportunity cost and the business cycle theory which generally lead to arguments in support of a hard asset money.

The Keynesian approach emphasizes stimulating demand, group actions, aggregations in demand, their mathematical modeling, a tiered monetary supply, coordinated monetary policy responses conducted by a trusted central authority which generally lead to arguments in support of a variable, stimulating, multi - tiered (M1 through M4) fiat money.

Even though both of these schools recognize and accept certain observations, measurements and theories from one another, they are generally at odds with each other and engage in charged, heated debate disagreeing in fundamental principles leading to the formation of two emotionally charged poles.

My personal approach to anything in life is, that success comes from balance, and truth usually lies somewhere in the middle. In designing the SCAO I took ideas from both of these two poles and combined them into one system for the following reasons:

Both economic theories are right and wrong, both have their strengths and their weaknesses:

The Austrian approach takes its confidence from real value creation, natural patterns / formations, logic and psychology. The main focus is stimulating supply and increasing productivity.

Keynesians in their arguably foolish belief that economic actors are rational reject the Austrian school on the basis their deductive reasoning is arguably useless in practice since it is impossible to empirically quantify and measure Austrians’ ideas, and that a hard asset lacking demand side stimulus leads to destructive laissez-faire boom and bust cycles that over the long term bifurcate into the haves and have-nots, which ultimately leads to feudalism.

The Keynesian approach takes its confidence from the resolution to the 1930s great depression achieved through artificial stimulation of the economy. The results were so successful stimulation continued, arguably contributing to the post second world war reconstruction and booms in economic production, population and increases in living standards. Keynesians begun dominating economics, leading to the eventual end of the Bretton Woods system which took the US dollar off of the gold standard and moved it to a backing by nothing other than mathematical economic modelling and good faith in the continued functioning of the economy.

The Keynesians’ main focus is stimulating demand. Their approach is validly criticized by the fact that often irrational human behavior is difficult to model economically. Moreover, fine tuning the economy through monetary policy adjustments will always either overshoot or undershoot their targets due to the impossibility of measuring and modelling individuals’ behaviors. Furthermore, a central entity wielding so much power will naturally lead to corruption. Today, there are fears this system is growing out of control and will eventually collapse since the money in this system is ultimately not backed by anything of real, hard value excluding the value of an arguably functioning economy / society.

The natural bi-polarization patterns between these two economic theories is nothing special. We can see countless examples in nature: capitalism vs. socialism, democrats vs. republicans, Bitcoin vs. Ethereum camps (Bitcoin has a fixed monetary policy, while the Ethereum community just organized a “triple halving” as a result of EIP - 1559 and the Merge).