The cryptocurrency and blockchain ecosystem encompasses an enormously wide-ranging set of ideological camps. It's enterprise organizations and non-profits. It's dictatorships and democracies, socialists and libertarians. It's bitcoin carnivores and vegans launching their own coins.
Technology, as American historian professor Melvin Kranzberg once said, is never neutral. It is inherently flexible to the ideology of the user. This is how social media can both spur democracy and interrupt it. This plasticity perhaps explains the diverse communities within the cryptosphere.
However, it is equally true that design and architecture shape human behavior and thought, and technology is, by definition, designed. The way that technology is designed affects how we use it, and nudges us toward certain behaviors. Software developers understand this. It's not an accident that you're addicted to Facebook and Instagram; they're designed so you engage more often and for longer. There are also companies attempting to design social media platforms that incentivize more pro-social interactions.
When it comes to blockchain, we're talking about a decentralized, immutable design. It follows that blockchain tech would attract a certain crowd of developers and users who value transparency and question coercion, censorship, and centralized authoritative bodies dictating rules from the top down. Many of the businesses and organizations built on blockchain technology are also designed to incentivize this kind of behavior and thinking.
The technology is still in its infancy, but it's already spurring radical new ideas for structuring power, authority, knowledge, and resource distribution. A newly published white paper by Glen Weyl, Vitalik Buterin, and Zoë Hitzig, "Liberal Radicalism: Formal Rules for a Society Neutral among Communities," presents one such radical idea.
To clarify, Liberal Radicalism's brand of liberalism is not at all the laissez-faire neoliberalism you often find among altcoin communities. Rather, the authors use the word liberalism to describe an intellectual tradition that "opposes arbitrary or historically-derived centralized authority. It favors – to the maximum extent consistent with social order – social systems that are neutral across reasonable competing conceptions of the good life held by individual citizens." This makes a lot of sense coming from Buterin, as it almost exactly reflects his hopes for Ethereum as a protocol to enable Dapps representing diverse, competing, and contradictory purposes and values.
The authors describe the paper as combining economic and mathematical logic with political philosophy to create "radical and yet realistic templates for solutions to large-scale practical problems, as well as novel conceptual possibilities for social and political life." Their philosophy is rooted in the legendary and widely controversial economist John Maynard Keynes, who once said that an economist "must be mathematician, historian, statesman, philosopher—in some degree."
Keynes is particularly controversial in the cryptosphere. Most famous perhaps for his argument that the solution to economic recession is more government spending, he's pretty unpopular with the bitcoin-centric crypto crowd. After all, bitcoin is often said to have gained traction in response to popular distrust in the government and banking system amid the 2008 recession and associated bailout. It was Keynesian economics that inspired that bailout. The idea that the authors seem to borrow from Keynes is that funding projects that benefit the public, even if the public doesn't contribute its fair share, can have a net positive effect on the economy.
Liberal radicalism seeks to address what the authors refer to as the "public goods" problem. A "public goods" problem, also known as the "free-rider problem," describes a situation in which those who benefit from a service are not the ones who pay for it (or not in proportion to how much they use it), thus creating an under-provision of that resource. Some areas the authors point to as examples of this issue are campaign finance, open source software companies, and news media.
In campaign finance, candidates who can raise enough money are often the winners, but those funding the election are typically a small, powerful, and privileged minority; the vast majority of people affected by any given political issue are not the ones funding a candidate, which can lead to candidates who are more representative of that population not receiving proper financing, and thus not winning an election.
Open source software companies, like many blockchain projects, are designed specifically for the public good, but because they're inclusive of everyone, it can be difficult to properly fund developers under traditionally capitalistic models: It's not always clear who should be getting paid, especially because so many development efforts will inevitably fail.
The authors point to news media financing as "perhaps the perfect application for the LR [liberal radical] mechanism." Almost everyone reads news and it is difficult to restrict access to it, especially with social media and the internet. It is also vitally important to democracy. But it's also expensive to create, and difficult to fund. In many cases, governments help fund news, but that creates an obvious conflict of interest for an industry that is supposed to act as a government watchdog.
The authors point to three prevalent models of dealing with this problem: the contemporary democratic nation state, wherein states use voting and taxes to decide what and how much to fund; the privatization of those services; and appeals to people's sense of identity to convince them to contribute.
However, the authors also identify flaws with these models, namely, that they are inflexible and tend to "respond to the will of the majority, not necessarily to what would create the greatest overall value."
Quadratic voting, described in depth in Glen Weyl and Eric Posner's 2018 book "Radical Markets," addresses the latter concern. Quadratic voting describes a system wherein everyone is given an equal amount of votes with which to express their preferences. They could choose to distribute those votes across any number of issues, allowing individuals to concentrate their voting power on issues they care about. For example, an individual from a minority group could choose to use all of their votes on one particular issue affecting that group, allowing that issue to gain traction in the greater society despite the fact that it may only affect a small number of people.
However, the authors explain:
"While QV addresses the inefficiency of standard [one-person, one-vote] voting systems for a given set of decisions and collectives, it doesn't solve the problem of flexibility. That is, it does not allow the set of public goods to emerge from a society organically, and effectively assumes a previously-specified organizational structure that has to be taken as an assumption or imposed by an authority."
In dealing with this limitation, liberal radicalism addresses the problem of "'entrepreneurial public goods' where a small community has an idea for a public good that is not widely understood at the time for funding. These may well receive no funding from democracy." Therefore, the authors' goal is "to find appropriate funding level [sic] without assuming … prior centralized knowledge."
They do this by articulating a "formula where a citizen's influence is proportional to her marginal value for the public good [emphasis my own]." This is achieved through a system of taxation and donations, as well as wealth redistribution.
As with quadratic voting, the way in which this is achieved is more complicated: It's all math. Perhaps most notably, funding for a project is proportional to the number of people the project benefits, not the number of people working on it, their status, or amount they can afford to contribute.
The authors state:
"The mechanism provides much greater funding to many small contributions than to a few large ones. This is not for any reason of equity or distributive justice, though there may be good reasons from those perspectives to admire the outcome it delivers. It is instead because large communities of citizens each receiving only a small benefit tend to be disadvantaged by Capitalism relative to concentrated interests."
They key takeaway here might be that there is room for everyone in the cryptosphere. New ways of considering economics and political philosophy may offer a common ground between diehard socialists and free market libertarians. In fact, Glen Weyl recently described Liberal Radicalism as "simultaneously true socialism and the most extreme free market."