Blockchain Governance 102

Response to Vlad Zamfir’s Blockchain Governance 101

Though he describes himself as an “absurdist” and a “troll,” Zamfir is proving to be one of the smartest cats in all of crypto.

Just as Shakespearean jesters often gave the most perceptive views on questions of high politics and state, the self-proclaimed “absurdist” has produced one of the most deeply analytical, pragmatic and, simultaneously, emancipatory tracts in all of crypto theory.

Yes, “all of crypto theory” — from the 90s through the Bitcoin Whitepaper, the Ethereum Yellowpaper, spin-off constitutions, on through today. If you don’t see it, then re-read Blockchain Governance 101. Then, keep re-reading until you start seeing it.

With the well-deserved laudatio out of the way, let’s sharpen our analytical knives and give Vlad what he asked for: let’s be skeptical about his assumptions and give feedback on some of the blockchain governance futures he’s outlined.

Terms Matter

To start, let’s give due to Zamfir’s crypto legal training, and then push it further along.

With Legalese, Easy Does It

Please note Zamfir’s careful and qualified usage of Legalese:

• “I don’t have all the answers …”
• “Generally, governance is …”
• “[I’ll define ‘legitimacy’ but only that, because] I’m not using any of the other terms in a very specialized way.”

Kudos, Vlad Zamfir, Esquire! That’s great lawyering 101. Being very careful with terms is the first step to identifying and narrowing the scope of problems one seeks to analyze.

Achtung! Crypto Legalese

Terminology is especially important in the context of blockchain governance, for at least four reasons:

1. First, mere usage of the term “governance” already triggers extremely complex socio-legal constructs like legitimacy, politics, law, en-force-ment, and so on.
2. Second, these terms have context-specific meanings depending on whether they’re used in a tech-coder setting, or a law-coder setting, or a crypto-anarchist setting, etc.
3. Third, even though CryptoLaw/crypto governance is mainly spoken in dialects of Americanized English Legalese, it would be a huge mistake to assume that this is the only language through which we need to study blockchain governance models. Chinese-, Russian-, French-language governance tracts are arguably as important as anything in Anglophone crypto legal theory, for obvious reasons having to do with truly global governance versus fragmented sorta-global governance [minus Russia & China].
4. Even casual governance-speak can alter “hard” governance rights. Even if unintended, references to governance decisions, preferences, rights can carry vast legal consequences. Need proof? Just ask Elon Musk how his plan to take Tesla private is coming along. One 420 Tweet, and you’re no longer chairman of Tesla.

Why Focus on Legalese?

After just a few brushstrokes, our critique is already sticky and legalistic. Is that really necessary? Can’t we just talk about governance without those pesky lawyers sticking their noses into crypto business?

The answer is very simple: No, you can’t!

It is not possible to talk about governance as “establishment, maintenance, revocation of legitimacy” without acknowledging Law as legitimacy, and vice versa.

There’s a ton of “law” in Blockchain Governance 101. Law features prominently in the inputs (e.g., trademark, IP law, jurisdictions, etc.) and a hyper-formal “Public International Law” regime is one of Zamfir’s five outlined governance outcomes.

For reasons we elaborate below, Law doesn’t feature nearly prominently enough.

You can’t do effective governance if you have FUD with respect to Law. Not saying Zamfir has Law FUD. Just saying that you can’t do good governance if you have Law FUD.

Simple Operational Logics

Blockchain Governance 101 covers both macro- and micro-, so-called “horizontal & vertical” governance issues. But wholesale treatment of blockchain governance in this way may be a bit loosey-goosey for some analysts and regulators (like Germans).

We propose the following operational vocabulary for blockchain governance, just to make it easier to do apples-to-apples, oranges-to-oranges analysis:

1. Intra-blockchain governance: the rules, practices, institutional constraints, and/or self-imposed processes for pursuing coordination, decision-making, and dispute resolution strategies within the context of a given blockchain organizational space (e.g., within EOS; within Ethereum; within IOTA; etc.);
2. Inter-blockchain governance: refers to governance matters between blockchain/DLT development crews (ETC v. ETH; ETH-Bitcoin; EOS-IOTA; Stanford & E+5).
3. Pan-blockchain governance: referring to governance matters that should be common to all blockchain/DLT platforms, such as, say, commitment to carbon-neutral implementation targets, etc.
4. Supra-blockchain governance: refers to broader governance issues, rights, expectations that are platform-agnostic (echoing corporate/public governance regimes, including, e.g., rights of investors to inspect accounting records; rights of public to restrict projects that contravene clearly-articulated public policy; etc.)
5. Private-off-chain governance: refers to contractual relations between blockchain development teams and various private/public entities (e.g., Ethereum-Amazon; IOTA-Volkswagen; etc.)
6. Global governance: a system of formal and informal rules, practices, institutions that shape how the world is run.
7. […]

Echoing Zamfir, if there are other terms we missed, or better definitions of existing terms that you would like to offer, please respond below.

Irrespective of whether you agree with the slightly revised framework or definitions, everyone should agree that it’s important to define terms because that is the only way that we can properly identify and define the problem.

Identify the Problem

Now that we’ve sharpened our usage and focus a bit, here’s Zamfir’s formulation of the problem:

[1] The process of legitimizing and delegitimizing things is a coordination problem, and it can be highly political when different participants want to coordinate around competing outcomes.

Now let’s restate this problem in sharper Legalese:

[2A] The process of legitimizing and delegitimizing things is a legal problem, and it can be highly political when different participants want to join armies to fight legal wars.

… and/or …

[2B] The process of legalizing crypto is a political problem, and it can be adversarial when different participants want to fight legal wars.

Now, let’s come up with the simplest restatement of the problem:

[3] Crypto’s got some nasty legal problems, and CryptoCats are itching for bloody cat fights. Time to choose sides, CryptoKitties!

Stated another way, “governance” and “legitimacy” are just euphemisms for what different crypto actors think should be legal and illegal.

Law is Not Thine Enemy

Looking at blockchain governance problems in this light must be a tough pill to swallow for crypto maximalists.

Crypto Law School

It’s very similar to the dilemma that law students encounter in their first weeks of law school. Practically everyone comes to law school thinking they will be learning what is “legal” and what is “illegal.” And then, in the first days, weeks, months, those principled and largely logical wannabe lawyers are exposed to some extremely disorienting truths.

The practice of law & governance is less about what is legal and illegal and far more about what you want, need (and can afford to argue) should be legal and illegal.

This isn’t just some cynical instrumentalist shark lawyer bullshit. This realization highlights the very essence of Law and legal processes.

Law is Oppressive & Emancipatory

In his Letter from a Birmingham Jail, Dr. Martin Luther King, Jr. reminded us,

One has a moral responsibility to disobey unjust laws. I would agree with St. Augustine that “an unjust law is no law at all.”

How is this relevant to blockchain governance?

Very simple. First, when your analytical framework takes certain assumptions as more-or-less settled, or more-or-less “inevitable,” your analytical framework makes those models slightly more settled, and slightly more inevitable. Second, we shouldn’t assume that any of the existing governance models are good or efficient (or just) simply because they serve as existing precedent.

Put Blockchain Governance alongside legal battles like the Civil Rights Movement or the battle over Net Neutrality, and the stakes come into sharper view.

One’s right to be a full-fledged participant in 21st century blockchain governance may be as important, if not potentially more important, than one’s civic voting right.

From Legal “Menus” to Legal Edicts

Floating a blockchain governance scenario that introduces “Internet Censorship as Blockchain Governance” because of the observation that “major jurisdictions [can & will continue to] outlaw and censor access to the blockchain that do not comply with local regulations” does nothing more than … lend legitimacy to … that very model of blockchain governance.

Words matter.

When anyone (not to mention someone as influential in crypto discourse as Zamfir) (a) introduces an “Internet Censorship” model of governance, and then (b) proceeds to objectively weigh its pluses and minuses, and then (c) invites readers to express their preference for this or that model, it’s (d) a step towards normalizing, legitimizing, and legalizing that Internet Censorship model.

«Вот, смотрите, Замфир пишет что цензура одна из систем регулирования криптовалют. Давай так и сделаем!»

Menus Often Hide Secrets

Giving a seemingly objective menu of governance options and then presenting them to an audience for consideration, deliberation, and polling seems like a kewl and pluralistic move.

But a big menu is also how shady cooks hide their kitchen secrets. Lots of pork on the menu can mean a cook who likes pork, or it can mean a glut in the pork supply, with attendant quality control issues.

Here’s Zamfir, again:

[Here are 5 menu options: (1) Autonomous Blockchains; (2) Blockchain Governance Capture; (3) Internet Censorship as Blockchain Governance; (4) Governance via Public International Law or Diplomacy; (5) Governance via International Private Cooperation] Each of these blockchain governance outcomes is possible, and it isn’t at all clear what the future of blockchain governance will look like, at least not to me.

We call BS!¹

If you’re an Ethereum core dev who’s been “thinking about, watching, and actively participating in blockchain governance for 3–4 years,” then yeah, your “research on the topic” can still be ongoing, but you should have a hunch as to whether “Autonomous Blockchains” and “Internet Censorship” are preferable, or not.

• When you ask people to open up their politics and signal their preferences, when you encourage others to press their peers to “clarify their positions,” you can’t hide your own preferences.
• You can’t expect others to clarify their positions if you’ve spent 3–4 years thinking about and participating in blockchain governance and you can’t clarify your own.
• Here are ours; what are your preferences? Please clarify.

Don’t blame us if it makes you feel uncomfortable; Vlad Zamfir told us to do this.

Self-Critique is Strength

We began our critique by praising Blockchain Governance 101 precisely because it arouses and invites this critique. But a critique is useless if it’s just projected outwards.

The best critiques, like the strongest laws, are of general applicability.

So here’s where the critique gets reeeeally interesting.

Who Is Governing Whom?

Zamfir uses the word “our” precisely one time in the entire Blockchain Governance 101 class. The word “we” is used precisely twice.

That’s telling. Here is the context in which “we” come up:

[1] This why we need to be concerned about the blockchain governance of every major public blockchain (existing or merely aspiring).

…

[2] Try to convince people to become aligned with your preferred vision of our shared blockchain governance future.

…

[3] [Governance via International Private Cooperation] This is arguably how we do internet governance today, through institutions like ICANN, IETF, WC3, IGF, etc.

Every other actor, stakeholder, and community is remarkably compartmentalized in Zamfir’s framework.

There’s a lot of “community” when it comes to Blockchain Governance; it’s just not “our” community. Take a look at some of the phrasing (and the assumptions/background logics at play)—

• the “political environment of the blockchain space” (abstraction: people, preferences, and communities become abstract “environments” & “spaces”)
• “that community’s blockchain” & “their blockchain communities” & “their political environment” (opposition: you v. them; us v. them; A v. B)
• “Identify which blockchain communities are dominated by what political orientations, and see whether they are leaning in the direction that you’d like to go.” (pluralism: many communities doing many different things is natural and inevitable, even if some “environments” & “spaces” are doing “Internet Censorship” that restrict your blockchain’s ability to tap into a given market)
• “Find your political allies.” (burden-of-proof shift: “I’m just a meek troll & Ethereum core dev; it’s your job to find political allies in this Hobbesian war of all against all.”)
• “You,” “your,” “you,” “your,” culminating in … “your committed individual participation can and will have a big impact on the future of the blockchain space.” (individualism: think about how outcomes impact you and the people you know; pursue “coordinated political action to avoid the outcomes you want to avoid; build alliances, but at the end of the day, it’s “my” assumptions, “your” visions — the only thing “we” share is … potentially … time and space, a distant disembodied “blockchain governance future” — whatever that means)
• “global public blockchains” & “global public” v. “small number of major blockchains will determine governance outcomes for the entire blockchain space.” (public v. private: the “global public” will insist on some right of access to “global public blockchains” [???] but a few major players [presumably private] will be setting the shared expectations for the ‘entire blockchain space.’)
• “Many participants […] inside and outside the blockchain space fail to effectively participate in blockchain governance.” (fault attribution: it’s not blockchain governance that’s failing, it’s the “confused” participants who can’t understand the “basics of blockchain governance.”

Decrypting BlocGov 101

Translation #1: take my poll, tell me what you think, keep lobbying for change, build alliances, you can make a difference, the future is ours to shape …

— just remember that, at the end of the day, a small number of major blockchains will really be calling the shots.

The names of these major blockchains are conveniently omitted, but, of course, Ethereum is implied.

Translation #2: here’s how we are thinking about governing you. Please take the poll, and tell us your thoughts on how we should be governing you. And please don’t forget to clearly identify your politics and form an alliance, so that you feel like you have a fighting chance to effectuate change.

Please note, this is not an attack on Zamfir or a veiled attempt at reverse fault attribution. This is a direct response to Zamfir’s express request that we be skeptical about his assumptions.

What you see above is skeptical deconstruction. If you want a more generous reading, here’s another potential interpretation/speculation.

Translation #3: something big is happening in blockchain governance, including another major fork in Ethereum; I’m trying to blow the whistle as carefully as I can and build an alliance, who’s with me?

Any number of other translations and readings are possible; and none of them have been especially reassuring. Don’t take our word for it; read the responses to Blockchain Governance 101.

We Are Concerned, Are You?

Remember the time “we” came up?

You might have missed it, so here it is again:

This why we need to be concerned about the blockchain governance of every major public blockchain (existing or merely aspiring).

At CleanApp Foundation, we are concerned about existing blockchain governance mechanisms. With zero conflicts, zero ICOs, zero crypto investments to cloud our vision, we have delivered critical work product to development teams across the crypto spectrum identifying both broad sectoral and hyper-localized threats.

We have been equal opportunity analysts, questioning:

• Ethereum Foundation misuse of “smart contract” & other legal forms;
• Bitcoin/EOS/Ethereum Classic’s misplaced faith in rigid #CodeIsLaw logics;
• IOTA’s claims of “quantum-proof-ness;”
• Kik/Kin’s self-harmful description of “crypto earning” opportunities;
• Crypto exchange consolidation around CryptoLending and crypto financialization;
• Crypto-wide misapprehension of law and legal processes.
• CryptoLaw more generally, as part of our periodical Crypto Law Review.

When it comes to blockchain governance, here are our core realizations:

(1) to understand crypto’s tomorrow, understand crypto today; (2) today’s blockchain governance mechanisms are broken because it’s almost impossible to access today’s blockchain governance mechanisms; (3) today’s blockchain governance feedback mechanisms are either nonexistent or grossly under-developed.

What’s our proof for #1, 2, 3? The fact that nobody, us included, has been able to answer the most basic questions of inter-blockchain governance today, such as: Is Stanford’s Center for Blockchain Research legal?

Bottom line: today’s crypto devs must fix these problems and open up meaningful governance feedback loops; else, our common crypto enterprise will fail.

¹ “We call BS!” is a motto of the victims and survivors of the Douglas High School shooting in Parkland, Florida. It’s a critique of the NRA & select lawmakers’ position that high capacity magazine assault rifles are part of America’s “legal tradition,” and hence, are impossible to outlaw. The students call BS because the position is BS. All law, by definition, is fluid and mutable. Indeed, that’s one of Law’s chief attributes.