What can the cryptocurrency space learn from the social sciences?

Will Szal
Will Szal
May 15 · 3 min read

Punishments and rewards are so ubiquitous they disappear from critical inquiry:

  • Grades in academia
  • Awards, such as the Nobel Prize
  • Performance-based compensation
  • Grants based on deliverables
  • Fines and jail time in the criminal justice system
  • Repercussions in parenting

In his 1993 book, Punished by Rewards, social scientist Alfie Kohn exhaustively reviews hundreds of scientific studies on behaviorism. Counter to the collective faith in “pop behaviorism,” he concludes that

Punishments and rewards definitively decrease performance.

To elaborate a bit on some of the instances in which Kohn investigates this topic:

  • Letting people set their own rewards doesn’t change their maleffect
  • Children raised with rewards have lower self-esteem and have less intrinsic motivation
  • Praise is no better
  • Performance-based rewards result in worse performance than volume-based rewards
  • The only instance where rewards don’t have a negative effect on performance is when they are eternal and for menial task devoid of creativity or fulfillment (in such instances, we may be better off discontinuing such working conditions to begin with)

To postulate a theory on the effect of rewards:

In the long run, rewards actually deter the behaviors they seek to incentivize.

Rewards compromise personal agency and contribute to feelings of being manipulated.

So why do they dominate our societal infrastructure? Why do families and organizations continue to turn a blind eye to the devastating evidence that punishments and rewards are worse than doing nothing?

Radical Behaviorism

Radical behaviorism has returned to infamy, heralded by Shoshana Zuboff’s recent book on surveillance capitalism:

You may have been hearing lately about B. F. Skinner, the founder of this school of thought. Skinner believed in a machine-mentality of humans. Given our plastic psychologies, humans can respond to rewards and be turned into machines, but this is not an ethical course of action.

As Zuboff elucidates, Silicon Valley has become the poster child of pop behaviorism. Many founders have become disenchanted with the human-as-machine analogy:

Power

If rewards don’t enhance performance, how are they useful?

Rewards establish and reinforce hierarchies of power and control.

They elevate the rewarder and demote the rewarded.

A consideration for why this would be desirable is beyond the scope of this post.

Cryptocurrency

From its inception, the cryptocurrency space has been pervaded by a behaviorist tone.

Section six in Nakamoto’s whitepaper is entitled “Incentive,” (which has a distinctly different implications than a word such as compensation). The term “reward” appears a dozen times in the Ethereum whitepaper. So it might come as no surprise to many that token designers might aspire to engineer motivation in the participants of their economies.

Given that the cryptocurrency space is still in its infancy and very much in an experimental phase not yet backed by definitive theory, what is at risk if we do not critically investigate our behaviorist bent?

Cryptocurrency’s dependency on a reward-mentality risks perpetuating a machine paradigm that extinguishes the possibility for creative solutions and emergent outcomes.

Given the many existential threats currently faced by humanity, these are risk that we cannot afford. Conversely, what opportunity is there for the creation of new economies grounded in intrinsic motivation?

Regen Network

At Regen Network, we come from a living-systems paradigm that seeks to develop the will and ableness of stakeholders in our network towards an aim of planetary regeneration. Given that we operate in the spheres of both regenerative agriculture and cryptocurrency, how can we leverage their strengths while reconciling their sometimes-divergent ideologies?

  • How do we create an economy where network participants are motivated by intrinsic will as opposed to extrinsic reward?
  • In a global economy pervaded by scarcity and insufficiency, how do we shift the economics of agriculture to compensate regenerative behavior, capitalizing regenerative agriculture and funding the right livelihood of land stewards?
  • How do we create a technology platform that enlivens human relationship with land (as opposed to further removing humans from a felt-sense of living systems)?

These are some of the questions we’re currently grappling with. We hope that others will join us in discernment and architecting of a regenerative world.

Regen Network

A blockchain network of ecological knowledge changing the economics of regenerative agriculture to reverse global warming. Learn more: https://regen.network

Will Szal

Written by

Will Szal

Regenerative agriculture, alternative economics, gift culture, friendship.

Regen Network

A blockchain network of ecological knowledge changing the economics of regenerative agriculture to reverse global warming. Learn more: https://regen.network

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