In an era characterized by unprecedented global interconnectedness and systemic challenges, the dynamics of money and its role in shaping social, economic, and political landscapes have come under intense scrutiny (Beckert, 2016; Dodd, 2015; Ingham, 2020). Traditional conceptions of money as a neutral medium of exchange whereby economic transactions are facilitated within predefined frameworks are being reevaluated considering emerging global interdependencies and societal transformations. The intricate relationship between money and freedom has long been a subject of philosophical inquiry, yet its exploration within the context of contemporary global challenges remains relatively underexplored. While classical theorists, such as Adam Smith and Karl Marx, have contemplated the implications of monetary systems on individual autonomy (Smith, 1776; Marx, 1904), the complexities of modern financial landscapes and their intersection with notions of freedom are often overlooked. For example, as global interdependences deepen, new questions arise about how monetary structures influence personal liberties and societal freedoms. Additionally, the advent of digital currencies and the globalization of financial markets present novel opportunities and challenges for understanding the dynamics of money and its implications for personal liberty. ¹

Consider, for instance, the rise of such cryptocurrencies as Bitcoin, which promise decentralized, borderless transactions outside the purview of traditional financial institutions (Nakamoto, 2008). While proponents herald these innovations as vehicles for individual freedom and financial sovereignty, skeptics caution against their potential to exacerbate inequalities and undermine regulatory frameworks (Chohan, 2021). Moreover, the relationship between money and freedom extends beyond technological innovations to encompass broader socio-economic and political dynamics. Amid widening wealth disparities and heightened social unrest, the distribution of economic resources and access to financial opportunities directly influence individuals’ ability to exercise agency and pursue their aspirations (Piketty, 2014; Sen, 2017). As such, understanding how the functioning of money shapes and constrains notions of freedom is essential for addressing systemic inequalities and advancing social justice in an increasingly interconnected world.

Furthermore, the urgency of such issues as climate change is accentuating the need to reassess the relationship between money and freedom in the face of contemporary global challenges. Climate change, as one of the most pressing issues of our time, carries profound economic and social implications (Taconet et al., 2020) that intersect with monetary systems. The increasing frequency of extreme weather events, shifts in agricultural patterns, and rising sea levels not only threaten ecosystems, but also disrupt economic activities and exacerbate social inequalities (Intergovernmental Panel on Climate Change [IPCC], 2022). As societies grapple with the consequences of climate change, questions arise about how monetary policies and financial systems can either mitigate or exacerbate these challenges. Thus, understanding the interplay between money functioning, freedom, and climate change would be essential for devising effective strategies to address the multifaceted crises humanity now faces.

Money may play a role in mitigating climate change-often through specific monetary forms or mechanisms-but it has also contributed significantly to its exacerbation, particularly by enabling the fossil fuel-based economy. The reliance on fossil fuels for energy production, transportation, and industrial processes has been a cornerstone of modern economic growth and development (IPCC, 2022). However, this reliance has also led to the accumulation of greenhouse gases (GHGs), resulting in global warming and climate disruption. The extraction, production, and consumption of fossil fuels are deeply embedded in the economic structures and monetary systems of contemporary societies, reflecting broader patterns of production and consumption driven by profit and market dynamics.

Therefore, comprehending the role of money functioning in exacerbating global challenges, such as climate change, entails examining not only its potential for mitigating environmental harm but also its involvement in perpetuating unsustainable economic practices across various domains. The monetary policies, financial incentives, and investment decisions that prioritize short-term gains over long-term sustainability have accelerated environmental degradation, exacerbated social inequalities, and hindered progress toward equitable development. Consequently, reassessing the relationship between money functioning, economic systems, and societal well-being would be imperative for transitioning toward more inclusive, resilient, and sustainable modes of economic organization (Bazzani, 2022a, 2022b). This necessitates adopting holistic approaches that recognize the interconnectedness between money functioning, economic activities, social dynamics, and environmental outcomes in addressing the complex issues we are currently facing.

This article delves into the intricate relationship between money functioning and negative freedom, particularly within the context of contemporary global challenges. In so doing, it offers an integrated perspective that considers the interconnections between money functioning, individual freedom, and social solidarity. Traditional conceptions of money as a neutral medium of exchange have been reassessed in response to such emerging global challenges as climate change, economic inequalities, and political instability. Complementary currencies, which operate alongside national ones, are often designed to address these challenges by fostering local economic resilience and social cohesion. These alternative monetary systems often aim to enhance community ties and promote sustainable economic practices (Degens, 2016; Place & Bindewald, 2015; Seyfang & Longhurst, 2013). By focusing on the intricate dynamics of money functioning, we highlight their influence not only on individual freedom but also on broader societal dynamics, such as social solidarity and economic equity. Through discussing two illustrative examples, Sardex and Twin Money, we shed light on alternative monetary functioning that can incorporate elements of contemporary interdependencies to foster positive freedom.

This article pursues two interrelated objectives. First, it aims to critically reassess how monetary systems structure freedom, distinguishing between negative (freedom from interference) and positive freedom (freedom to act meaningfully and collectively), especially in the face of pressing global challenges. Second, it explores how specific monetary infrastructures-namely Sardex and Twin Money-serve as conceptual examples of institutional innovations that can embed social and ecological values into monetary design. This raises the following guiding research questions: What kind of freedoms do contemporary monetary infrastructures enable or constrain? How can alternative monetary designs promote solidarity and sustainability by supporting positive freedom?

The article is structured as follows. After introducing classical and contemporary debates on money and freedom, it analyses the evolution of neutral money and its implications within neoliberal and modern state arenas. It then discusses how global interdependencies challenge traditional monetary functioning and introduces the concept of monetary infrastructures that internalize externalities. Through the examples of Sardex and Twin Money, the article identifies features of monetary design that enable alternative forms of freedom aligned with collective well-being and environmental sustainability.

The freedoms of modern money

Freedom stands as one of humanity’s most cherished ideals, embodying autonomy, agency, and self-determination. Within political philosophy, freedom has been articulated in two distinct yet complementary forms: negative and positive. Negative freedom, defined notably by Isaiah Berlin (1958) and John Stuart Mill (1859), refers to freedom from external constraints or interference, emphasizing the individual’s right to act according to their own will without coercion or limitation by others. This conception highlights the individual’s autonomy, particularly in such contexts as economic exchanges, where freedom is understood as the absence of external restrictions. Negative freedom is often associated with liberal political traditions that prioritize individual rights and minimal state intervention, underpinned by the belief that individuals are best positioned to determine and pursue their interests when left free from external compulsion.

Positive freedom, conversely, as elaborated by Jean-Jacques Rousseau (1762), extends beyond mere non-interference, encompassing the capacity to fulfill one’s potential, actively participate in collective decision-making, and contribute meaningfully to the common good. Unlike its negative counterpart, positive freedom requires enabling conditions (e.g., resources, social structures, institutional supports) that empower individuals and communities to act in ways aligned with collective goals and individual flourishing. This perspective is rooted in the recognition that individual autonomy and agency are deeply intertwined with social contexts and collective conditions. Positive freedom is central to communitarian and republican traditions, emphasizing the active role of individuals and groups in shaping their shared environments and destinies.

Positive freedom has gained significant attention in contemporary sociological discussions as societies face complex global challenges (Bazzani, 2023a). These challenges highlight the limitations of purely negative conceptions of freedom, demonstrating the need for social and institutional frameworks that enable collective action and mutual support. The distinction and interplay between negative and positive freedom thus provide critical theoretical lenses through which to examine modern economic practices and monetary systems, underscoring how differing conceptions of freedom inform distinct economic philosophies and institutional arrangements. This section explores how modern forms of money are closely linked to negative freedom. These forms of currency not only facilitate economic exchanges, but also contribute to the development of forms of social coordination based on this notion of negative freedom, allowing individuals to act without external interference or coercion.

Modern state arena for neutral money

The arena of modern society has emerged as a critical prerequisite for the development and functioning of neutral money-a concept discussed by both classic thinkers and proponents of neoliberal policies. Classical sociologists, such as Comte and Durkheim, have extensively studied various forms of solidarity within societies, shedding light on the complex interdependencies that connect individuals. In particular, Durkheim’s (1933) theory of modern solidarity provides valuable insights into the structural changes in modern societies, such as urbanization, industrialization, and technological progress, which have given rise to a new form of interdependence. For Durkheim, pre-modern solidarity was characterized by mechanical connections among homogeneous groups, rooted in a collective consciousness. However, modern solidarity is organic, relying on specialized contributions in large-scale societies as a consequence of labor division and societal complexity (Durkheim, 1933). While remnants of pre-modern solidarity persist on a smaller scale, modern society has witnessed the emergence of novel forms of solidarity, including state taxation for redistribution and mutual support among minority groups (Honneth, 1991; Putnam, 2007; Taylor, 1989).

The evolution of modern solidarity is intricately linked to state apparatuses, such as bureaucratic, military, and police structures, alongside the centralization of political power and the establishment of central banks. These state mechanisms create an arena for individual participation, ensuring certain degrees of individual freedom while fostering interdependence and solidarity among citizens. This arena accommodates diverse notions of individual participation in the collective, ranging from self-preservation to the delegation of needs satisfaction to state apparatuses (Brunkhorst, 2005).

At the heart of this discourse lies the arena provided by modern states-a vital precursor for the emergence of neutral money backed by various manifestations of solidarity, cultivated by both state apparatuses and market mechanisms. Within this arena, diverse forms of individual participation find common ground, allowing for an environment conducive to the development of both positive and negative freedom. Neutral money embodies a sense of neutrality that transcends individual values and preferences. As a medium of exchange, neutral money is vital to facilitating transactions and interactions. Its neutrality allows for seamless economic exchanges, much like the modern arena accommodates diverse forms of solidarity and conflict within society.

Examining the modern arena as a prerequisite for neutral money reveals the intricate interactions between freedom, solidarity, and the functioning of money. It underscores the indispensable role of state apparatuses in nurturing various forms of interdependence, thereby promoting societal cohesion and supporting the modern arena of individual freedom within economic functionality in tandem. While modern freedoms serve to disrupt the social ties of the premodern era, the new interdependencies and solidarity developed within the modern labor division reconnect what was separated, forging a new dynamic in the socio-economic landscape.

The instantiation of neutral money within the economic framework of the modern arena is intertwined with the notion of competition among individuals and organizations. This competitive environment is ethically and economically validated by the anticipated secondary effects resulting from the efficient operation of financial markets. The envisioned outcomes include the emergence of more productive and profitable investments, which incentivize less competitive entities to innovate and improve, ultimately benefiting both businesses and consumers (Amato & Fantacci, 2014).

However, the transition from theoretical propositions to practical applications of this monetary infrastructure reveals a gap between expected and observable effects. The expansion of competition into broader spheres of social life may exacerbate inequalities and produce social, environmental, and political externalities that challenge the notion of money’s neutrality. Short-term negative externalities, such as unemployment and business closures, may emerge, highlighting the complexities inherent in implementing competitive mechanisms within monetary systems (Piketty, 2014).

Furthermore, applying the competition mechanism to the international circulation of money presents challenges in achieving equilibrium effects. Unlike other commodities, outflows of money from issuing countries do not relieve them from debt constraints, potentially exposing economically weaker nations to greater financial fragility. Empirically proving increased productivity due to competitive pressure is challenging, given the unrealistic assumptions required for such a scenario, including equal levels of information and rational behavior across citizens of different states. While neutral money has the potential to foster negative freedom, its practical application raises complex issues surrounding the interplay between competition, autonomy, and societal well-being. This balance is further complicated by the acceleration of global flows.

Global challenges and planetary interdependences

In recent decades, the acceleration of global flows -ranging from people and goods to money, GHG emissions, and viruses- has ushered in new interdependencies that transcend national boundaries, challenging the traditional constructs of the modern arena. This heightened global mobility of goods and money mirrors an extension of the modern division of labor, albeit on a global scale. Conversely, the emergence of climate change (driven by GHG emissions) represents a distinctive interdependence not witnessed during the modern era. Furthermore, modern migration patterns, influenced by global labor division and associated inequalities, also respond to the impacts of climate change (Kaczan & Orgill-Meyer, 2020; Marotzke et al., 2020).

While these global interdependencies maintain the essence of the modern arena, they exhibit two notable distinctions from their modern counterparts. Firstly, the apparatuses of modern states-historically tasked with promoting solidarity and welfare for all citizens-appear increasingly inadequate for addressing the solidarity required to confront these global challenges. The interdependencies posed by these challenges undermine the capacity of modern state apparatuses to effectively tackle them, potentially fostering competitive or free-rider behaviors among countries (Falkner, 2016). The once-modern arena created by state apparatuses, fostering solidarity even among competing citizens or firms, no longer ensures a collective response. Individuals, firms, or states may opt for a free-rider approach, with no overarching authorities to delegate or enforce the necessary solidarity. The absence of an arena, such as the State, capable of autonomously managing these new interdependencies, leaves individuals or groups without a clear structure to pursue their goals. Human-induced climate change reveals nature’s response through global warming, transforming the biosphere into a “critical zone” with intricate interdependencies that lack a superordinated authority (Latour, 2018). Consequently, the pursuit of solidarity becomes a collective responsibility, necessitating coordinated actions across various levels of groups, organizations, states, and supranational entities. The exclusive delegation of this responsibility to the state is no longer feasible, as no single entity possesses the capacity to ensure the required level of solidarity in managing the critical zone.

Secondly, unlike traditional and modern solidarity, which focuses on ensuring the welfare of the immediate community or state (the “us”), addressing global challenges often involves aiding distant entities (the “others”). Efforts to combat global inequalities and climate change frequently benefit people distant in place (Global South), time (future generations), or relation (migrants). For instance, coping with climate change requires solidaristic actions from the current populations of wealthy countries, bearing the costs of reducing GHG emissions in favor of developing countries and future generations. Similarly, strategies addressing global inequalities in the labor division of global value chains or in coping with pandemics involve prioritizing the welfare of others. This altruistic form of solidarity, distinct from its mechanic or organic varieties, highlights a need to redefine the requisite solidarity (Bazzani, 2023b, 2024). Furthermore, the modern proliferation of individual freedoms within contemporary economic frameworks is juxtaposed against a lack of solidarity from both governmental institutions and market mechanisms. This imbalance is exacerbated by the absence of robust supranational regulatory frameworks capable of ensuring equitable market access and functionality for all stakeholders amidst global competition.

Climate change emerges as a formidable disruptor, inflicting substantial economic burdens through extreme weather events, resource scarcity, and disruptions in agricultural productivity (IPCC, 2022). These environmental challenges strain economic resources and necessitate regulatory interventions and technological innovations, potentially challenging the unfettered ethos of economic freedom (Coeckelbergh, 2021). Simultaneously, entrenched poverty perpetuates socio-economic disparities, stifling opportunities for upward mobility and constraining the realization of economic freedom for vast swathes of the global populace. Addressing these challenges demands not only immediate action but also a reevaluation of the underlying principles that govern our economic systems. While modern money functioning, rooted in the concept of negative freedom, has fueled individual liberties, it has often done so at the expense of broader social cohesion and environmental sustainability. The following section explores examples of alternative money systems that prioritize positive freedom and foster inclusive prosperity and ecological resilience.

Money for internalizing interdependences

In the face of these new interdependencies posed by global challenges, modern money-as the true neutral-is insufficient for coordinating social action. This is because the interdependencies and externalities that modern money used to leave to the nation-state and nature are no longer managed solely by the former, especially in the case of such natural processes as climate change. Without a supranational authority to fulfill this role, the development of other institutions becomes necessary.

From this perspective, contemporary money could potentially internalize these interdependencies. For instance, consider the example of carbon trading as a form of money that seeks to internalize these interdependencies. Carbon trading involves the buying and selling of permits to emit carbon dioxide or other GHGs, with the overall goal of reducing carbon emissions. By assigning a monetary value to carbon emissions and allowing them to be traded, carbon trading incentivizes businesses and industries to reduce their carbon footprint and invest in cleaner technologies (Perdan & Azapagic, 2011). However, while carbon trading is an attempt to internalize the externalities of carbon emissions within the monetary system, it also faces its own set of challenges and criticisms. Critics argue that carbon trading can lead to market manipulation, loopholes, and the shifting of emissions from one location to another rather than achieving meaningful reductions in overall emissions (Sato et al., 2019). Additionally, there are concerns about the fairness and distributional effects of carbon trading (Lejano et al., 2020), as it may disproportionately impact certain communities or regions.

Despite these issues, the concept of using money to internalize interdependencies remains relevant in addressing global challenges. It highlights the potential for monetary systems to evolve beyond their traditional functions of facilitating exchange and storing value to actively incentivizing behaviors that promote environmental sustainability and social equity. As the global community continues to grapple with interconnected issues, such as climate change, the role of money in internalizing interdependencies is likely to become increasingly important in shaping collective responses and fostering global cooperation.

Recent developments in contemporary monetary markets highlight these very dilemmas. Central Bank Digital Currencies (CBDCs) and private stablecoins, for instance, have sparked intense debate over how new forms of digital money might either expand financial inclusion or amplify inequalities. CBDCs represent state-led initiatives that allow central authorities to program specific rules into currency-potentially facilitating tax collection or disincentivizing carbon-intensive purchases-so as to align monetary systems more closely with collective goals (Bank for International Settlements [BIS], 2021). Meanwhile, privately issued stablecoins promise frictionless, global transactions, but often operate outside robust regulatory frameworks, which risks exacerbating existing inequalities and environmental degradation due to volatile speculation or high energy consumption (Chohan, 2021). These new monetary arrangements reflect both the promise and pitfalls of internalizing interdependencies. On one hand, programmability could embed social and ecological values directly into currency usage (positive freedom); on the other, insufficient governance may strengthen purely individualist, profit-driven logics (negative freedom) to the detriment of collective well-being.

Another approach to addressing these new interdependencies and internalizing them within the functioning of money is through the use of complementary currencies. Over the past three decades, local-level monetary innovation and experimentation have led to the development of 4,500 complementary currencies, community credit systems, and alternative financial frameworks (Servet, 2013). These are not designed to replace conventional money; rather, they aim to fulfill needs and objectives that are typically unaddressed by traditional money. This has resulted in a diverse array of currencies, each targeting specific cultural, governmental, economic, social, and environmental goals (Place & Bindewald, 2015). Unlike traditional money, these innovative monetary experiments are purpose-driven, with many explicitly focusing on promoting solidarity and sustainability (see Degens, 2016; Place & Bindewald, 2015; Tichit et al, 2016; Seyfang & Longhurst, 2013). Complementary currencies serve various purposes, such as fostering local economic growth, supporting specific sectors or communities, and addressing economic inequality. Examples of complementary currencies include local exchange trading systems, time-based currencies, community currencies, and digital cryptocurrencies (Place & Bindewald, 2015). These often possess their own units of account, exchange rates, and circulation rules, coexisting with or complementing the official currency. Complementary currencies are often employed as a means to cope with the negative effects of global competition and the adverse impacts it creates in economically weaker contexts (Place & Bindewald, 2015).

Operationalizing positive freedom in monetary design involves embedding social and ecological values into the mechanisms through which currencies circulate and transactions occur. For instance, integrating conditionality and programmability into monetary instruments (e.g., CBDCs) can explicitly direct economic activities toward collective goals, such as reducing carbon emissions or enhancing social equity (BIS, 2021). However, operationalizing these mechanisms also entails navigating significant challenges, the most pressing of which are scalability and governance: programmable money requires sophisticated infrastructure and regulatory oversight, demanding extensive institutional capacity. Moreover, integrating social and environmental values into monetary systems inevitably involves trade-offs between economic efficiency, individual autonomy, and collective well-being. Stakeholders invested in existing monetary arrangements-in particular, financial institutions or powerful market actors benefiting from current structures-may resist reforms that could undermine their established privileges or introduce new regulatory complexities (Larue et al., 2022). Thus, effectively operationalizing positive freedom requires not only technical innovation but also political negotiation, stakeholder alignment, and robust governance frameworks that balance these competing interests.

In the next section, we use two illustrative examples to examine how complementary currencies (Sardex) and innovative proposals (Twin Money) are being implemented to address contemporary challenges and promote more inclusive and sustainable economic systems. We chose these examples as they offer promising avenues for internalizing social values and promoting positive freedom within local and global contexts. Sardex is an apt example of incentivizing cooperative economic exchanges aimed at meeting local development needs within monetary functioning. Meanwhile, Twin Money is a promising concept designed to internalize the value of non-market activities, such as caregiving and community service, within monetary systems. The discussion of Sardex references previously published data regarding the consequences and functioning of several years of currency operations. ² In contrast, the discussion of Twin Money focuses on the design characteristics of the currency, as conceptualized by Massó (2023), which enable it to internalize certain dimensions of contemporary interdependencies that can promote positive freedom. Both discussions aim to highlight features of monetary functioning that can incorporate elements of contemporary interdependencies to foster positive freedom.