Posted on Feb 02, 2024Read on

Notes On Network States

It’s easy to dismiss the ‘Network State’ notion as some technocratic, libertarian fantasy, divorced from the practical realities of human life. However, the impulse to do so reveals more about how constrained our political imaginations have become than the underlying merits of the idea itself. Details aside for a moment, the fundamental thrust of the Network State idea is simple: where the nation state, and its underlying social apparatus -- rule of law, sovereign money, state monopoly on violence etc. -- have served as the guiding socioeconomic principle by which modern homo sapiens coordinate at scale, perhaps the Internet -- and its associated technologies -- might equip us with a fundamentally new mode of social organisation, one uniquely suited to the dynamics of the Digital Age. While Balaji -- the leading proponent of the Network State movement -- proposes a rather specific manifestation of this idea, if we simply suspend disbelief for a moment, there are many conceivable ways this idea might take form. In fact, in some meaningful sense, we already have what we might think of as ‘proto Network States’ in the form of blockchain networks.

Although there are many ways we might conceive of and conceptualise blockchain networks, if we turn our heads but a few degrees, they begin to look a lot like nation states ‘in the cloud’. They are, among other things, comprised of a citizenry, coordinating around a native asset (i.e. a sovereign money) in accordance with some set of predefined, preprogrammed rules (i.e. rule of law). And while today’s blockchains -- certainly the smart contract varieties -- are marketed as ‘general purpose technology platforms’, it’s not hard to conceive of a world where blockchains are constructed explicitly around some social or political objective rather than any specific technological agenda. To some extent, this is already true of the two most valuable cryptonetworks -- Bitcoin and Ethereum. Not only are they technological systems, they are, equally, ideological systems; potent meme complexes that ignite a sense of mission and purpose, community and belonging. And that’s precisely what makes them so valuable.

While blockchain networks represent the most cogent analogy to the nation state, one needn’t look further than today’s social media to understand how digital networks, in general, have become a powerful political force in the world. However overplayed these examples may be, consider Twitter and the Arab Spring, or the role Facebook is considered to have played in the 2020 election. More fundamentally, though, simply consider how much of our collective time and attention is being concentrated in these systems; how our sense of community and identity are increasingly being defined by the online spaces we colocate in. Where blockchain networks diverge from ‘social’ networks, however, is in the underlying structure of their network design. Platforms like Facebook, Twitter, and Instagram concentrate power in the centre, in the corporate entities that single-handedly oversee their development. Blockchain networks, in contrast, distribute power to the edges, to the people and projects that collectively facilitate their evolution. Accordingly, they represent a very different, more ‘democratic’, social and economic logic than their web2 counterparts. In this sense, blockchain networks are much closer in essence to the architecture to the Internet itself.

Above all, what makes blockchain networks so powerful is the way in which they leverage a native asset -- i.e. a token -- to effectively ‘self-fund’ the development of their infrastructure. Where social networks depend upon a central company to finance the development and maintenance of their services, blockchains circumvent this necessity by employing an Internet-native mechanism for ‘crowdsourcing’ the provisioning of resources. And instead of traditional marketing, by distributing ownership across the network as a whole, anyone who holds the blockchain’s native asset is incentivised to market and evangelise the network, thereby contributing to its underlying value.

What this amounts to, or so I suggest, is a fundamentally novel economic model; one that could, in principle, be leveraged for far more than simply bootstrapping a smart contract platform. It could be used, as Balaji suggests, to form a community around a vision for a new State and eventually crowdfund the purchase and development of physical territory. But it could also be used for so much more. You could imagine, as I already have, a blockchain that coordinates around the mission of solving climate change; managing a shared treasury which its members collectively allocate to certain pro-climate causes. Moreover, you could imagine existing highly online communities like EA or e/acc spinning up blockchain networks with their own tokens that fund causes they consider meaningful. In the case of EA, for every token minted from their smart contract, you could imagine $10 dollars going towards the purchase of mosquito nets in Africa (however problematic that may or may not be). And in the case of e/acc, perhaps they find a way to finance the development of fusion or new AI paradigms. Less overtly revolutionary, but equally interesting, you could also imagine a blockchain that amounts to some form of ‘headless lifestyle brand’; a decentralized Nike, say, which shares IP and depends upon user generated content and products, and accrues value via a token. Whatever the particular instantiation, the essential point is that in blockchain networks, we have a new means of coordinating resources at a global scale; an organisational structure native to the Internet; a third option beyond the profit vs non-profit dichotomy; what I refer to as ‘Institutions for the Digital Age’.

However remote from Balaji’s Network State these notions may be, the common thread that unites a hypothetical Effective Altruist blockchain and a Praxis is the coming together of a group of people online to do something meaningful, and sharing in the economic value of that something together. Amidst a landscape of ‘parasocial media’, and broader existential angst, it’s this notion of coordinating around something that evokes a sense of purpose, that produces meaning and belonging, that makes the idea of the Network State so compelling. After all, what could be more compelling than starting your own country? However, as I’ve been implicitly suggesting, I think a lot of the value of inherent to the Network State notion could be realised without the ‘State’ piece. With or without diplomatic recognition, it’s the notion of designing networks of value, networks of meaning, that matters.