Ulex: An Open-Source Legal System

Ulex, an open-source legal system for special jurisdictions, Special Economic Zones, online markets, startup cities and other startup communities, is strongly related and relevant to cryptocurrencies.

In “The Extropian Roots of Bitcoin” (2014) I showed that Bitcoin and other cryptocurrencies have their roots in the radical, futurist philosophy of Extropy.

Max More and Tom W. Bell published the “Extropy” print magazine in the late 80s. The “Extropians” mailing list was launched in the early 90s, soon after the inception of the public internet. See the archives of the magazine and the mailing list.

Many of the founding fathers of the cryptocurrency movement, including Nick Szabo, Wei Dai, and the late lamented Hal Finney, participated actively in the Extropians list. All three have been rumored to be the real person behind the Satoshi Nakamoto identity, and perhaps one of them is.

If not, was the real Satoshi on the list? I guess they were (I am not using “they” for “political correctness,” but because the real Satoshi might be a group of persons). Satoshi most certainly posted to the sister mailing list “Cryptography,” owned by early Extropian Perry Metzger.

Besides cryptography, libertarian politics and a myriad of futuristic high-tech topics, alternative legal systems independent of nation states were frequently discussed on the Extropians list.

The paper “Privately Produced Law” (1991), by Extropy co-founder Tom W. Bell, was first published in the Extropy magazine. While Bell’s ideas have evolved since then, this shows that — just like Bitcoin — Ulex has roots in early Extropian thinking.

Bell is now a professor of law specialized, among other things, in “polycentric law” — a legal structure in which providers of legal systems compete or overlap in a given jurisdiction. Bell’s polycentric law page lists his publications on the topic since 1991.

In “Your Next Government?: From the Nation State to Stateless Nations” (2018), a book that is the current Bible of polycentric law and Ulex, Bell explains that Ulex aims to do for special jurisdictions and other startup communities what GNU/Linux has done for computers: “provide an open-source operating system free for all to download, run, modify, and share.”

“In very general terms, Ulex protects personal and property rights with efficient and fair dispute resolution processes and rules, encouraging economic growth and promoting the rule of law. Ulex applies not by sovereign command but by the mutual consent of contracting parties, and issues from no single country, but instead draws on legal traditions from across the globe. In these ways Ulex differs from the legal systems run by traditional nation states.”

Bell explains to me that Ulex offers an open source answer to the pressing question: what laws should govern our communities? “Ulex offers the prospect of finally separating the law from government,” he says. “ Or, more properly, for putting governments not in charge of the laws — a fatal mistake — but under the control of them.” Bell adds:

“The Ulex rules come from private and non-governmental organizations; Ulex bears no country’s flag. Just like other open source code, Ulex is freely available for downloading and customization. Instead of a legislature, Ulex has a Github repository.

Though initially designed for special jurisdictions hosted by countries that want to import the developed world’s legal innovations without its flags, Ulex has also proven popular among private parties engaging in transactions across international borders, who likewise seek a neutral source of excellent rules.

And, make no mistake, Ulex uses top-notch rules. They are from institutions founded by learned judges, lawyers, and academics, deliberating without the influence of lobbying or re-election.

Ulex’s rules have moreover been tested long and hard in the real world; because it borrows from the (private, non-profit) Uniform Law Commission’s Uniform Commercial Code, which more than 50 jurisdictions have also adopted in whole or part, Ulex gets the benefit of popular and trusted rule-sets.”

Concerning the synergy between Ulex and cryptocurrencies, it seems to me that cryptocurrency communities could, instead of reinventing the wheel, adopt Ulex as baseline legal system for their rules, rights, and dispute resolution methods.

It’s conceivable, I think, that a Special Economic Zone, hosted by a nation state but regulated by Ulex, could one day gain the freedom to adopt a cryptocurrency as a parallel, alternative legal tender. This is, I think, a realistic path to a parallel crypto-economy within the constraints of today’s world.

But more adventurous experiments will be possible in autonomous seasteading communities — “floating communities on the ocean, where settlers can make their own rules de novo, unbound by the principalities and powers based on land” — and, eventually, autonomous colonies in space. Bell comments:

“It would indeed be a worthy project to work up a set of model rules, based on admiralty law, for both seasteads and space settlements.”

Picture from Libre Shot.