Even though it was created originally to support Bitcoin, Blockchains are something deeper: a technological solution for human trust-based transactions. Nonetheless, trust may never be enabled onchain without an effective governance system. Like any other human made product, Blockchains are per se intention-agnostic, and thus, depend very much on who and how is its governance designed and deployed.
I believe we all very much agree that Blockchain technology enables verified transactions without trusting human integrity, and that it has a huge potential as distributed system for the exchange of value. But this should not prevent us from realizing where we are, and where we do not want to be. The fact that Blockchain based systems enforce their own rules as if they lived in their own ad hoc jurisdiction does not mean they constitute proper legal systems (or improper ones). At this point, I want to think that we´ve overcome the “Code is Law” stage.
Let’s just remember ourselves that the idea of online communities successfully enforcing their own rules without regard of governments isn’t new, it happened during the 90s and it did not work. Lawrence Lessig has an excellent book where he brilliantly explains how and why.
On the onchain ecosystem, we have also witnessed an attempt of replacing law with code, and it was made clear that even it could reduce certain “human” problems, it definitely brought others.
Why? imo, because Blockchains are excellent instruments for verification, but trust is a cake that needs additional ingredients. At the end of the day, they are created, deployed and used by humans. And humans are unique at two things: destroying natural resources and subjective intention.
Intention, backed up by motivation, is the common element behind Blockchain’s main scandals: TheDAO, MtGox, Parity…of course there was an element of code vulnerability, but without intention, none of them would’ve ever lost a satoshi. That’s why some of us argue that Blockchain’s main concern is not a question of code, but of governance. Debates and discussions may continue about whether to call it a fork or an upgrade, or whether it is sufficiently decentralized or not, but the truth is that for these technology-based systems to achieve their full potential, subjective intention needs to be added to the formula, through governance.
Being Vlad one of the most prolific governance researchers, it’s a must to quote him. In one of this recent Medium posts, he writes:
“I intend to have Blockchains serve as global public utilities, with no owners, and I intend for them to be governed ethically and in a way that puts the interests of the public before the interests of other participants”.
See? Intention is unconscious, but ubiquitous.
Developing and deploying rules and norms is a tough problem that legal systems have been accomplishing for centuries, with certain level of success. To me, governance tries to do something similar: it tries to path motivation in an attempt of reducing to the maximum any possible corrupt intention. Again, Vlad talks about decisions, processes or coordination mechanisms, which can all be reconnected to intention. Basically, the intention of using the blockchain according to its foreseeable or commonly agreed use, or not. which also seems to be the basic reason for which Nakamoto designed Bitcoin combining cryptography and game theory techniques.
Vlad expresses the same idea, although uses different words. He explicitly talks about “legitimacy” and a system where “if a coordination mechanism is legitimate, people will (justifiably) act like it’s a fact that people will use it”.
And a coordination mechanism can only be legitimate when the general intention is to use it, in the agreed terms. Note that this agreement does not need to be explicit, it may also be implied. It happened with The DAO: the general intention of the vast majority of the investors was to use The DAO as an investment vehicle, and share profits, according to the read.me and the terms that the promoting team published. Therefore, exploiting a code vulnerability was a non-agreed use of the product that made the decision automatically illegitimate (even if investors were afterwards given the chance of post-legitimating it).
This is the main idea: as Vlad says, “when a decision is legitimate, people don’t need to worry about whether other people will also implement it, they can be confident that they will”, but that works for implementation, it will not cover the repression of undesired actuations to their last extent.
Coming back to The DAO example: what was the only difference between The DAO attacker and the miners who set forth the hard fork? Subjective intention. An element that cannot be parameterized, nor assessed by code. Sometimes, and most of the times when we have code in place, the criteria used to define the legitimacy or legality of an action is subjective motivation. And that, my friends, is as human as you and me.
