“ReFi”, is an emerging global cultural movement and field of finance that seeks to create economic systems, practices, and strategies that support regenerative and restorative outcomes in ecological and social systems. ReFi's core principles involve the reorientation of financial & economic systems away from extractive, exploitative & degenerative practices towards sustainable, inclusive, resilient, and regenerative models which account for externalities and prioritize ecological harmony and holistic capital.
While standing for Regenerative Finance—a term with history stemming from the field of Regenerative Economics—the “ReFi” abbreviation has origins stemming from the DeFi (Decentralized Finance) movement, and it is often used specifically in reference to the application of Web3, Distributed Ledger Technology (DLT), AI (Artificial Intelligence), dMRV (digital Measurement, Reporting, & Verification) and other advanced technologies in supporting the visions and practice of Regenerative Finance.
ReFi marks a paradigm shift from conventional, extractive economic models. Historically, these models have prioritized the extraction of natural resources for financial gain, often disregarding social and environmental consequences which are approaching critical tipping point. By contrast, ReFi practitioners, or “Regens”, aspire to establish non-extractive economic systems which instead place value on living systems, biodiversity, resilience, and holistic capital. These systems place ecological benefits and the well-being of the planet and its people at their core.
Regens value collaboration over competition. They champion transparency and the stewardship of public goods and commons. Moreover, they embrace whole systems thinking and social equity. They also seek to learn from indigenous knowledge and dismantle the socioeconomic structures stemming from colonial and imperial practices. The ReFi cultural movement extends beyond changing financial infrastructure. It aims to transform social narratives and politics, fostering a better world rooted in ethics, consciousness, and distributed technology.
The underpinnings of ReFi can be traced back to the early 20th century with innovative ideas around monetary policy and economic theory. In 1916, economist Silvio Gesell proposed the concept of "Freigeld," a currency designed to encourage economic activity through a negative interest rate, which discouraged hoarding and aimed to improve the economic status of those in poverty.
In the subsequent century, various scholars and economists further shaped the theoretical basis of ReFi. John Fullerton argued that money, beyond its practical utility, was a reflection of a society's spiritual and cultural values. This line of thought was echoed and elaborated upon by Charles Eisenstein in his thesis, "Sacred Economics". Eisenstein postulated that money served not just as a medium of exchange or store of value, but also symbolized societal values and moral systems, reinforcing the idea that economic systems are inherently tied to social and ethical structures.
source: https://capitalinstitute.org/8-principles-regenerative-economy/
The feasibility of communal and sustainable economic systems was exemplified by Elinor Ostrom's research on common-pool resources. Contradicting traditional wisdom, Ostrom demonstrated that communities could sustainably and equitably manage shared resources through cooperation and trust, a paradigm shift that earned her the Nobel Prize in Economics in 2009.