Рецензия · 8. Кибергосударства — это ответ?

8. Are Cyberstates the Answer?

8.1 Preliminaries

In 1996, in the wake of the passage of the Communications Decency Act (CDA) by the United States Congress, the Internet found an unlikely hero in John Perry Barlow. Barlow was a Republican Wyoming cattle rancher, a former lyricist for the Grateful Dead and, not least, a cofounder of the Electronic Frontier Foundation. Fed up with the CDA’s ham-fisted attempt to censor the Internet, Barlow wrote and uploaded his proclamation, ‘A Declaration of the Independence of Cyberspace’. From its opening paragraph, the essay did not pull punches:

Governments of the Industrial World, you weary giants of flesh and steel, I come from Cyberspace, the new home of Mind. On behalf of the future, I ask you of the past to leave us alone. You are not welcome among us. You have no sovereignty where we gather.

Barlow then doubled down on his thesis that terrestrial governments have no claim over the sovereignty of cyberspace:

Governments derive their just powers from the consent of the governed. You have neither solicited nor received ours. We did not invite you. You do not know us, nor do you know our world. Cyberspace does not lie within your borders. Do not think that you can build it, as though it were a public construction project. You cannot. It is an act of nature and it grows itself through our collective actions.

It concluded with a pledge to create a ‘civilization of the Mind’ in cyberspace. In order to accomplish this, the thought was that ‘We must declare our virtual selves immune to your sovereignty’ and further that ‘We will spread ourselves across the Planet so that no one can arrest our thoughts.’ And finally, it articulated the aspiration: ‘May [our Civilization of the Mind] be more humane and fair than the world your governments have made before.’¹

Inspired by this work and similar discussions in the Internet slipstream at the time, Peter Ludlow collected a group of essays into a collection entitled Crypto Anarchy, Cyberstates, and Pirate Utopias.² The title itself was a play on Robert Nozick’s famous defence of libertarianism, Anarchy, State, and Utopia,³ and it asked the question: What if virtual states could be formed that existed online – cyberstates? Would it be possible? Would it be a good thing?

Ludlow concluded that such states were indeed a possibility and that they were already in the formation process, but he expressed some pessimism about their ability to persist. He reasoned that these ‘islands in the net’ (using a phrase borrowed from the science fiction author Bruce Sterling⁴) might have their day, but that day would be fleeting. Terrestrial governments would surely use their power to eliminate them eventually. Thus, he closed his anthology with the classic underground manifesto by Hakim Bey, T.A.Z.: The Temporary Autonomous Zone.⁵ Bey thought that these islands in the net, like the Caribbean pirate enclaves of the eighteenth century, would be fleeting postmodern utopias. They would form, dissolve and then reorganise elsewhere.

Ludlow’s volume appeared in 2001 and, as David Hume once said of his most famous publication, An Enquiry Concerning Human Understanding, it initially ‘fell stillborn from the press.’⁶ But more than two decades later, with the rise of social media and web3 and blockchain technologies, people have begun to revisit its central thesis. Are cyberstates a possibility after all? And if so, is the outlook for their persistence more optimistic than it was two decades ago? We do not think they are the final stage in the progress of human governance, but we suspect they just might outlast traditional terrestrial nation states.

In this book’s Introduction, we looked at the extensive role of legacy governments in our lives and, beyond that, the ubiquity of governance of some form or other in almost all aspects of our lives. In the previous chapter, we saw that the role of governments in the creation and preservation (and sometimes destruction) of wealth is massive. Of course, all of that was to set up a case that we want to make for an alternative to traditional nation states and to the traditional tools of governance that are used. Our promise was to make the case for blockchain governance. In Chapters 5 and 6, we discussed how blockchain governance will work (we will go into more detail later). Now, we want to introduce one particular form of blockchain governance: the cyberstate.

Cyberstates are governance structures organised around blockchain technology, with the idea that they will take on the role currently occupied by nation states, although with several advantages over contemporary nation states. Balaji Srinivasan has called them ‘network states’,⁷ and while they are indeed organised around networks, we prefer to call them ‘cyberstates’, with a nod to Norbert Weiner’s term ‘cybernetics’ and an even bigger nod to the Greek term kybernetes, or ‘steersman’ (metaphorically, ‘guide’ or ‘governor’). In other words, cyberstates are not merely aimless networks of people and groups of shared interest, but they can provide guidance (direction) for those groups.

Cyberstates are superior to nation states because they can be organised around shared interests and values rather than arbitrary political boundaries, which are typically established by rivers and oceans and, quite often, by histories of armed conflict over natural resources. The cyberstate, by contrast, is geographically unencumbered. Its ‘territory’ is determined by its footprint in cyberspace, which is unlimited in scope and scale.

Cyberstates, like blockchain communities generally, also allow communities to become self-determining – a principle enshrined in the Charter of the United Nations, although not particularly respected by the existing political order.⁸ Political self-determination means that people get to choose how they are ruled. The government they are subjected to is not determined by where they are born or which despot happens to take power over them. They have a say in what their government looks like and how it operates, and they also have an opportunity to move freely to a political system that they find more favourable.

Because cyberstates would be organised around information-processing networks, one could engineer tools to enhance commerce, voting and other aspects of governance. Indeed, one can build tools that allow cyberstates to help their citizens flourish economically and culturally. Cyberstates are relatively easy to join and relatively easy to exit. If the rulers of the cyberstate are not following your values, you exit. In reality, it is not quite this simple; as we will see in Chapter 9, exit is not frictionless, but we can engineer ways to minimise frictions.

Certainly, there are a lot of questions that need to be addressed. Perhaps you have already thought of some of them. For example, what if there is no government that suits you? Or what if you choose a government that does not deliver on its promises? And forget about your cyberstate; who governs where you actually live in physical space? Who is in charge of security there? And who is in charge of fixing potholes and disposing of waste? Or for that matter, what if another cyberstate full of hackers comes after your cyberstate and drains it of its wealth? And what about money? And laws? And food? And everything else? We will get to these questions eventually, at least as they pertain to the more general idea of blockchain communities.

First, stepping back and taking the view from altitude, we can say that cyberstates are online communities, organised around blockchain technologies, that carry out functions usually associated with traditional nation states. This might include providing security; assisting community welfare (things like Medicare or Medicaid); playing a role in supporting national culture (think of the French government’s support of the arts); and supporting business in the form of negotiating trade agreements, encouraging business development and so on.

Obviously, in the case of cyberstates, these familiar functions will be grounded in the digital realm and will thus look somewhat different than they do today. In the realm of security, for example, one principal function of the cyberstate would be to support the security of its core information infrastructure and avoid hacking assaults and ‘zero-day exploits’.⁹ Cyberstates would certainly be able to provide physical security as well, whether in the form of purchased security forces or simply leasing bases from which kinetic forces can keep lines of physical communication open (shipping routes, for example). At the end of the day, they are not virtual states but rather, as we stated, states organised around blockchain technologies. This means that they may have a very large footprint in the physical world. Blockchain technology is simply the central nervous system of the cyberstate, whether its activities are online or in the physical world.

What then is the big difference between cyberstates and traditional nation states? The principal difference will be that in cyberstates, the governance activities of the state take place onchain. This means that important records, communications (including decision-making processes), voting, and government promises and policies are all on the blockchain and all very much visible to community members. Policies will take the form of onchain smart contracts. Votes may well be direct votes for those smart contracts. It will thus be an infrastructure grounded in blockchain technology, meaning its functions will be distributed yet cooperative.

More specifically, this means that, for a cyberstate, the economic rails will use a blockchain-based currency like bitcoin and an onchain decentralised financial system, its records will be immutable yet accessible to all, and its policies and intentions will take the form of smart contracts that are visible to all onchain. Contrary to John Perry Barlow’s vision, it need not be some sort of disembodied state but may be a state very much grounded in the physical world, albeit organised with the use of technologies that afford decentralised cooperation.

As we noted, the general idea of a cyberstate has become more popular in the last two decades (certainly taken more seriously), and one recent version of the idea has been put forward by Balaji Srinivasan in his book The Network State. Since that project is well known in the online community, it is worth spending some time contrasting our position with his.

Srinivasan begins his book with a one-sentence definition of a ‘network state’.

A network state is a highly aligned online community with a capacity for collective action that crowdfunds territory around the world and eventually gains diplomatic recognition from pre-existing states.

As we understand this statement, he is saying that there are three components to a network state:

1. A highly aligned online community with a capacity for collective action
2. Crowdfunding territory around the world
3. Gaining diplomatic recognition from pre-existing nation states

He follows with a paragraph-level definition, which goes into more detail on these key ideas.

A network state is a social network with a moral innovation, a sense of national consciousness, a recognized founder, a capacity for collective action, an in-person level of civility, an integrated cryptocurrency, a consensual government limited by a social smart contract, an archipelago of crowdfunded physical territories, a virtual capital, and an on-chain census that proves a large enough population, income, and real-estate footprint to attain a measure of diplomatic recognition.

Our vision of blockchain communities intersects with Srinivasan’s vision of network states in some respects, but we part company in key areas.

Let us start with the shared vision part. A blockchain community will definitely involve a highly involved online community with a capacity – indeed, a robust capacity – for collective action. We also agree with some of the development of this idea in the more extended definition. There should be an integrated cryptocurrency and a consensual government that utilises social smart contracts of the type we discussed in Chapters 5 and 6.

However, we do not see the centrality of ‘a sense of national consciousness’, nor do we even see the desirability of a sense of national consciousness. As Srinivasan points out, the etymology of the term ‘nation’ suggests the importance of place or group of birth (‘nation’ being from the Latin root nasci – to be born). Our view is that the nation is part of the core problem with nation states. Cyberstates (or network states) may choose to leave the idea of the nation behind. There are any number of ways a cyberstate might come together – through shared interests or beliefs or goals (including a shared interest in pluralism) – and this need not have anything to do with where we are born or whom we are related to by birth. People have no reason to organise themselves around their idea of national identity. However, this is not to say that they may not or will not.

We also take some exception to the idea that there must be a ‘recognized founder’. There is nothing wrong with founders per se (one of the authors of this book is a founder), but in cases like Bitcoin, the founder may be anonymous and then disappear. Indeed, one might even make the case that it is better that way. On this line of reasoning, obsession with founders can be a way of introducing mythology into the foundations of our governments. For sure, it is hard to avoid the existence of founders. Someone has to get things up and running, after all. Still, there is no obvious reason to build the mythology or even importance of founders into the very definition of ‘cyberstates’.

We do agree, as we said, with the promise of blockchain technologies for human governance. As we noted earlier, good governance, among other things, requires immutable, transparent records and economically sound money. While blockchain technologies do not guarantee these things, they certainly make them easier to achieve. As noted, this is a point on which we are in substantial accord with Srinivasan.

This brings us to clauses two and three of Srinivasan’s one-sentence definition of a ‘network state’. We have doubts about both of these components, and here, we are perhaps taking issue with the need to reproduce the image of the traditional state on the blockchain. In other words, we take issue with both the nation part and the state part of the nation state. First, we do not see the necessity of crowdfunding territory for a blockchain community. Such communities do not need to have, or even be interested in having, sovereign control over physical territory. Second, we disagree that blockchain communities must somehow earn respect from or be recognised by existing nation states. In any case, it is not necessary for existing nation states to recognise blockchain communities as equal partners. It might be enough that they do business with blockchain communities, just as they do business with many nongovernmental organisations (NGOs), corporations and individuals throughout the world. Ultimately, what matters in blockchain governance is that community members are flourishing.

You are probably thinking that we glossed over that rather quickly, and we could not agree more. Thus, the remainder of this chapter is devoted to diving deeper into these questions. In Section 8.2, we will make the case that there is no need for blockchain communities to trouble themselves with the acquisition of physical territory. Doing so always exists as an option, of course, but ultimately, we will argue that while blockchain communities will be able to protect your individual property rights (should you so desire), it does not follow that they must acquire control of physical territory in order to do so.

In Section 8.3, we will visit Srinivasan’s idea that cyberstates should seek out recognition from traditional nation states, and we will argue that while this is an option, there is not much point in it. Ultimately, we want to supersede the old boys’ club of nations, not join it. In 8.4, we will take up the issue of national identity and argue that this can be a dangerous idea, which also should be optional. By the time we get to Section 8.5, Srinivasan’s idea of a network state will be pretty well deconstructed, which is perhaps just as well because, as we noted in Chapter 2, the very idea of a state (like the idea of a nation) may have reached its expiration date.

8.2 Must blockchain communities have physical territories?

As we noted earlier, Balaji Srinivasan’s definition of a ‘network state’ includes the idea that such a state would ‘crowdfund territory around the world.’ Srinivasan envisions the result as an archipelago of physical territories under the control of the network state.

Now, the first observation that we want to make is that this is not at all a crazy idea. It is entirely possible for blockchain communities to purchase chunks of physical land or perhaps other physical locations – offshore seasteading locations, for example. Our point is not that this would not work or even that blockchain communities should abstain from crowdfunded purchases of physical territory. Our point is merely that it is not necessary.

Why do blockchain communities not need physical territory? What kind of state-like governance does not have an inch of physical territory? People have to live somewhere, after all. However, where they live is quite a different question from where their community is located in physical space or even whether it is located in physical space at all.

As we write, approximately 1.6 million United States citizens live in Mexico.¹⁰ Some of those citizens get into trouble from time to time, and if the trouble is serious enough, they will contact a United States consulate for assistance. If they wish, they can also receive regular updates from the US government about dangerous hot spots in Mexico and other countries where they might travel. They are, for all practical purposes, represented by a significant player should trouble arise. Chances are, if they are US citizens, they are much less likely to be harassed by the local police, the federal police, the local narco leaders or whoever happens to be in charge in that area.

This leads us to the following thought experiment. What if the United States did not have physical territory but still had the wealth and ability to project the power that it does? For example, suppose its wealth was all onchain and its military forces were stationed on leased property as they are today in military bases throughout the world. Indeed, as of this writing, the US has 174 military bases in Germany, 113 in Japan and 83 in South Korea. There are hundreds more scattered around the world in places ranging from Aruba and Australia and Bahrain and Bulgaria to Colombia, Kenya and Qatar, to name just a few. Worldwide, the United States has bases in more than seventy countries. Despite popular belief, none of those bases constitute US territory. Our point here is that if you have the financial resources, you can project a lot of military might without having complete sovereignty over or even owning physical territory.

What would be the point of having such a vast military presence if you had no territory to defend? Well, the myth about the US military is that it is there to protect US territory. In fact, the US military is vastly larger than would be necessary to protect its territory. Consider, for example, a conventional attack from the country that is arguably the second greatest threat to the United States: Russia. As we write this, the Russian Federation is struggling to maintain its supply lines as it struggles to seize territory in eastern Ukraine, even though Ukraine borders Russian territory.¹¹ Rivers like the Dnieper pose major tactical obstacles.

Meanwhile, should Russia choose to attack the forty-eight contiguous United States with conventional forces, it would not be as simple as crossing its border into Ukraine using already existing roads and rail systems. To execute a physical attack, Russia would first have to transport its forces thousands of miles. Assuming it had enough cargo planes and ships to do this successfully, it would still need to maintain logistical support across great distances. If Russia cannot handle the logistical challenges of attacking Ukraine, there is no way it can handle the logistical challenges of a conventional (non-nuclear) attack against the United States. Such an attack would be challenging for Canada or Mexico even if they had the offensive armies to attempt it. So, what is all that US military force for?

The United States Armed Forces do not primarily exist to protect US borders but rather to ensure that the global financial system, global resources and global supply chains remain unmolested. This means that oil not only needs to be pumped freely in the Middle East but that it must be transported freely around the world. Similarly, it means that Apple’s and Walmart’s supply chains across the globe remain uninterrupted. As the 2020 COVID-19 outbreaks showed, supply chain interruption can have serious consequences for the global economy. And in the end, this is what US military forces are defending: the global economy. This is not a new phenomenon. Imperial navies like the British Navy long understood that one of their key roles was to keep international shipping lanes open – in their terminology, ‘to protect the lines of communication’.

Let us return to our thought experiment, which showed that you could imagine being a United States citizen, enjoying the protections of its economic and military might, without the United States holding any physical territory at all. The thought experiment raises the question: Would it make any difference at all to the 1.6 million US citizens living in Mexico? Not likely.

In point of fact, we can extend our thought experiment. This would never happen, but surely it is logically possible that the United States could relinquish all its territory and its mission to protect its borders and focus all its attention on protecting the economic interests of US citizens worldwide. If you hold US citizenship, you would be protected (and of course, also required to pay taxes to the US). As with most thought experiments, we do not consider this a likely scenario, but it should nevertheless help us see what governments are really about – protecting the interests of their citizens and their business relationships around the world. The fetish for territorial sovereignty is a sideshow.

Now, we recognise that territory – land – is sacred for many people. Various political groups tie their identity to geographical locations. The Land of Israel is a case in point, as it is land that was believed to be promised to the descendants of Abraham. On very much the flip side, Nazi Germany advanced the concept of Blut und Boden (blood and soil), which emphasised the connection between German ethnicity (blood) and the land (soil).

A very different articulation of this idea is found in the book Ohitika Woman by Mary Brave Bird:

Maka ke wakan – the land is sacred. These words are at the core of our being. The land is our mother, the rivers our blood. Take our land away and we die. That is, the Indian in us dies. We’d become just suntanned white men, the jetsam and flotsam of your great melting pot. The land is where even those Native Americans who live in the wasichu cities, far away from home, can come to renew themselves, where they can renew their Indianness. We have an umbilical cord binding us to the land and therefore to our ceremonies – the sun dance, the vision quest, the yuwipi. Here, the city Indians can relearn their language, talk to the elders, live for a short while on ‘Indian time,’ hear the howl of brother coyote greeting the moon, feel the prairie wind on their face, bringing with it the scent of sage and sweet grass. The white man can live disembodied within an artificial universe without ties to a particular tract of land. We cannot. We are bound to our Indian country.¹²

There is a discussion to be had about whether the attachment of national identity (or any identity) to physical territory is healthy or whether it is deeply problematic. Perhaps some of us can live within an artificial universe without ties to a ‘particular tract of land’, and others cannot. We are not here to take sides in such a debate. Our point, at the moment, is that physical territory need not be important for every community, conceding that it may be very important for some.

All of this may seem like a long-winded way to take issue with Srinivasan’s idea of network states and the need to crowdsource physical territory, and for all we know, he would agree that states should not have to do so. However, our goal here is not to cavil with Srinivasan so much as it is to drive home the point that communities can be divorced from physical territory.

What does life look like for citizens of a landless community (whether you call it a state or not)? Well, it looks very similar to how it does now for the millions of expats worldwide. Some of them travel around the world as digital nomads, and some of them stay in the same place for the bulk of their expat lives. Some of them work online as programmers or graphic designers or writers – any type of work that can take place online. However, many others work in the service industry. There is absolutely no reason that they could not work in factories or be agricultural workers, although this typically involves expats from less wealthy to more affluent countries.¹³

There are plenty of options concerning the ways in which a landless blockchain community might help its citizens. Such a community might help with security and legal troubles, assuming citizens pay taxes to the blockchain community. Following our earlier thought experiment, it could provide health care and retirement benefits to its global citizens. In that case, it could use its clout to negotiate better prices for medicines and treatments, for example. It could negotiate deals with real estate developers and service providers on behalf of its citizens. It could negotiate tax treaties with terrestrial governments to ease the tax burdens on its citizens. There is really no limit to what such a community might be able to offer its citizens if it had sufficient clout. All services could be provided just as easily, even if there is no land or territory ‘back home’.

A blockchain community could also negotiate tax-free special economic zones (SEZs) for businesses that its citizens create. Do you want to open a factory to make electronic vehicles or drones or breakfast cereal? There are plenty of existing SEZs around the world with rules negotiated with whichever sovereign authority controls the territory. A blockchain community, even if it had no territory of its own, could negotiate SEZs on behalf of its manufacturing sector, giving it an archipelago of manufacturing locations. Similarly, it could negotiate the leasing of farmland for its agricultural sector.

We are saying that a blockchain community need not depend solely upon a virtual economy simply because it is technically landless. If it can arrange the frictionless leasing of manufacturing and agricultural territory for its citizens, there is no reason that it could not have the manufacturing and agricultural base of the largest nation states. Blockchain communities could have sovereign control over physical territory. However, there is really no reason for them to need it, apart from certain religious or cultural demands that they should.

8.3 Should blockchain communities aspire to be diplomatically recognised by nation states?

We mentioned earlier that another point where we take exception to Srinivasan’s network state is that, according to his definition, a network state should aspire to be recognised as an equal by existing nation states. Why do we take exception to this idea?

The first thing to understand is that traditional nation states do business with a wide array of entities beyond other nation states. It is not as though individuals and organisations are invisible to nation states. Indeed, nation states routinely enter into commercial arrangements with all kinds of private enterprises. For a very obvious case, think of defence contractors, which are organisations that work closely with the governments of the world. However, governments are constantly requesting bids for goods and services from corporations, individuals and NGOs.

Our point here is that if non-state actors are already visible to existing nation states, it does not matter if some blockchain communities are recognised as being on a par with traditional nation states or not. Whether a traditional state wishes to hand the honourific title ‘state’ to a blockchain community or not hardly matters. The important question is whether traditional governments are willing to do business with blockchain communities or not, and the answer to this is that they absolutely will if the communities have something of value to offer them – for example, educated workers or investment opportunities or security arrangements or jobs for its people. Blockchain communities have a lot to offer, not only to their citizens but to the existing terrestrial powers that host their citizens.

So, our first thought is, who cares if a traditional nation state recognises your blockchain community as a fellow state or not? Who cares if you get a seat at the United Nations or not? On the other hand, we understand Srinivasan’s sentiment. One puts a lot of effort into building a blockchain community; is it not reasonable to wish to be recognised as an equal by existing states?

At first glance, it may be natural to think this way, but on reflection, it is a somewhat backward way of thinking. Blockchain communities are not merely new kids on the global block. They are a big part of the future of human governance. If you are the future of governance, you do not worry about invitations to the old boys’ club. You are going to form a new club. Our view is that nation states served their purposes or perhaps misserved their purposes but, in any case, their time has come and gone.

What then becomes of global governance and the United Nations? Well, there is no point in a blockchain community worrying about being invited into ‘the family of nations’. Blockchain communities will be actors on the global stage, and besides traditional nation states, they will be engaged with many more entities. They will be engaged with international corporations, with countless NGOs, with all kinds of terrestrial authorities ranging from cities to SEZs and, in some locations, local cartel leaders and military strongmen.

Could we envision that cyberstates would be admitted into the United Nations someday? Sure, but as we asked, is that even such a big deal? Perhaps a bigger deal would be if the rise of cyberstates led us to appreciate other forms of governance around the world. Why not have an organisation to represent the interests of tribes or economic classes of people or religious groups or residents of SEZs or, for that matter, blockchain communities?

Maybe what we really need is an organisation that offers seats at the table to all modes of human organisation, including tribes and special interest groups – a League of Communities, perhaps. We are not making a proposal here; we are saying that the reflex to be seen and recognised as equals by nation states is a misguided one. Nation states are organisations built around obsolete technology. They are themselves becoming obsolete. We need not care what they think.

8.4 Should blockchain communities strive to have national identity?

This leads us to the final point where we take issue with Srinivasan’s idea of a network state – the idea that there be ‘a sense of national consciousness’. As before, we stress that there likely will be blockchain communities with a sense of national consciousness; there may even be communities with national identity tied to place of birth or ethnicity. However, there may well also be communities in which the sense of identity is nothing more than pride in being a member of the most efficient or most ethical or most pluralist community.

This is not just a quibble with Srinivasan, however, for we think that one of the principal benefits of blockchain communities is that they allow us to leave national identity in the proverbial dustbin of history. For traditional terrestrial states, located as they are in distinctive geographical territories, it is not surprising that there is a sense of ethnic or national identity in that area. It is the area where most of the citizens were born, after all. However, on reflection, this is something of an artifactual property of nation states. There are so many ways to organise a community; why should national identity be one that we prioritise?

There is also no question that nationalism can be a dangerous principle around which to organise a state or a community. It is not accidental that the term ‘Nazi’ is from Nazionalist, which is to say ‘nationalist’. The Nazi party was simply the nationalist party.¹⁴ And Nazi Germany is far from the only case where nationalism led to genocide and ‘ethnic cleansing’. It is not even difficult to see why this should be so.

If one had a magic wand, perhaps it would be wise to use it to eliminate nationalist sentiment altogether, given its history. However, there is no such magic wand, and it is difficult to see how one can eliminate the sentiment that human beings have for ethically grounded national identities. For all we know, that sentiment could be baked into the selfish genes of human DNA.

It is also worth pointing out that certain forms of nationalism not only seem benign but perhaps even worth fostering. Should we take objection to some Native Americans identifying as members of the Lakota nation, for example? We also forget that national sentiment, not so long ago, was very much a progressive idea. For example, during the revolutions that swept through Europe in 1848, a lot of revolutionary spirit was driven by nationalist sentiment, which served as a foil against the Habsburg Empire.¹⁵ Nationalist sentiment in Warsaw Pact countries also served as a counterweight against the former Soviet Union during its collapse in 1990.¹⁶ Given that nationalism can be a positive force under some circumstances, and given that it is probably impossible to eliminate it in any case, we think that the best solution is to accept that some blockchain communities will organise around a sense of national identity.

In saying this, we are buying into the fiction that national identity is something real above and beyond a very amorphous sense of ethnic familiarity. The collapse of the Soviet empire also coincided with the collapse of the Socialist Federal Republic of Yugoslavia, with resulting atrocities and acts of genocide against Bosnians and Croatians. The Serbo–Croatian language became understood as separate languages – Serbian, Croatian and Bosnian – despite the fact that from a linguistic perspective, they are more similar than American English is to British English.¹⁷ The differences between Catholicism and Orthodox Christianity, which played a role in the ex-Yugoslavian conflicts, seem just as artificial from the long-term perspective. Such differences can be a big deal if you want them to be (they were certainly a big deal in the Thirty Years’ War) or if some demagogue convinces you that they are. Our point is that national identity is constructed from a collection of differences that may seem important but which, at the end of the day, are fleeting, random and unimportant.

It is also plausible to think that the intensity of ethnic identity in ex-Yugoslavia directly resulted from General Tito’s attempt to wipe out cultural differences and impose a new national identity for Yugoslavia. In other words, it was his attempt to impose cultural conformity within terrestrial borders. This is, of course, a variation on the theme we discussed in Chapter 2 – a consequence of having diverse groups kettled together within a geographic territory. Only in this case, the idea was not to impose culture A over culture B but to impose some third universal culture C. Repressing cultural differences does not lead to happy outcomes.

Our point is that any difference in religion or language or culture or genetic makeup can be imagined to be a big deal and can be construed as an integral part of national identity. And maybe it is a big deal to some people. It is not possible to make it go away. Arguably, it can even be a positive thing for the preservation of some cultures. The optimal system of political organisation is thus not to eliminate cultural diversity nor repress the desire of people to organise around such principles but to ensure that groups, so organised, do not trample on the rights of others. We have already seen how blockchain communities enable people to do this. They allow people to organise themselves unconstrained by physical location, and they enable diverse groups to organise in different ways and around diverse principles even when they happen to be in the same physical territory.

None of this is to say that blockchain technologies can make atrocities and acts of genocide go away. As we saw, there is no stopping people from organising around perceived national identities, and there is likewise no stopping separate national identities from coming into conflict over physical territory. We can only show a path in which humans can organise themselves with indifference to physical territory but also in a way that allows people to exit from unfavourable governing situations.

8.5 Network states versus blockchain communities

So far in this chapter, we have taken issue with three key elements of Srinivasan’s definition of ‘network states’, or as we would prefer to call them, ‘cyberstates’. However, we find additional issues elsewhere in his definition. To be explicit about this, let us revisit his definition once more:

A network state is a social network with a moral innovation, a sense of national consciousness, a recognized founder, a capacity for collective action, an in-person level of civility, an integrated cryptocurrency, a consensual government limited by a social smart contract, an archipelago of crowdfunded physical territories, a virtual capital, and an on-chain census that proves a large enough population, income, and real-estate footprint to attain a measure of diplomatic recognition.

In the previous three sections, we took issue with the need for a ‘sense of national consciousness’, the need for a ‘recognized founder’, the need for ‘physical territories’, and the need to ‘attain a measure of diplomatic recognition’. Is there anything left here worth keeping?

Well, it is not at all clear that governance requires ‘an in-person level of civility’, nor is it clear to us that ‘moral innovation’ should be part of the bargain – a blockchain community might be morally conservative or even reactionary. Even the need for an ‘integrated crypto-currency’ is not entirely clear, as a blockchain community could rely on entirely external cryptocurrencies like BTC or ETH.¹⁸ Yet, there remain elements of Srinivasan’s project that are worth salvaging.

Our principal disagreement with Srinivasan is with his focus on national identity and the notion of a state as an important part of the formula. As we have already indicated, national identity is a tricky business, and there is no reason it needs to be folded into blockchain governance. As for statehood, as we argued in Chapters 2 and 3, the very idea of a state is unravelling across the globe. While we do not see the need for things like civility and moral innovation in successful governance, we can agree with Srinivasan about one very important point: human governance should be implemented with blockchain technologies at its very core. As we said several times earlier in this book, those technologies will serve as the central nervous system of future human governance.

However, once we move from talking about states – or cyberstates and network states, for that matter – to talking about blockchain communities, new questions arise. How do we join these communities, and just as importantly, how do we leave them? And finally, what if a community insists that we leave? As we will see in the next chapter, these are not simple questions with easy answers.