How Crypto Is Shaping the Digital Revolution

I have previously categorized ’crypto’ – a catch-all for blockchain- and Web3-related innovation – as part of the Digital Revolution that started around the late 1960s to early 1970s with the invention of packet-switched networks, microprocessors, and other digital technologies that enabled the proliferation of personal computers and the Internet. I would like to expand on that by:

  1. Providing a brief theoretical outline of the two main stages of technological revolutions;

  2. Comparing the organizational and institutional shifts of the previous revolution (centered around oil, automobiles, and mass production) with those of the current one (centered around digital information and communications technology) as imagined during the dot-com era (late 1990s, early 2000s); and

  3. Discussing how ’crypto’ as a techno-populist reform movement and innovation cluster is shaping global institutions and governance as the Digital Revolution matures.

Throughout the text, I will be using ’ICT’ as a shorthand for digital information and communications technology, and ’ICT Revolution’ as a shorthand for the Digital Revolution. From here on, quotation marks around the word ’crypto’ will be omitted, while still referring not just to cryptography, but to all blockchain- and Web3-related innovation. Readers familiar with Carlota Perez’s theory of techno-economic paradigm shifts may skip the first section.

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Isomorphism in DAO Governance

The term ’institutional isomorphism’ refers to similarities in the structure and processes of independent organizations. In the past, the spread of information and the adoption of similar practices was slower and often limited to organizations within a single country or region. But in the newly emerging institutional field of blockchain networks and decentralized autonomous organizations (DAOs), which benefit from near-instant global communications via the Internet, isomorphism develops much faster.

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On Autonomous Software →

This article is a comment on Lane Rettig’s essay Autonocrats and Anthropocrats, connecting its central themes to two fundamental concepts in social sciences — the rule of law and social structure. It explains how the most informative analogue to a decentralized network of nodes running autonomous software is society itself. Digital record-keeping and distributed computer networks are comparable to other institutions with effects beyond the control of their creators, administrators, and users. As such, they represent an important area of research not only for computer scientists and software engineers but also for social and political theorists whose expertise could be usefully applied to the design and governance of these emerging systems.

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The Bookkeeping View of Money →

The three common ways of theorizing money — as commodity, legal construction, and credit — can be effectively reconciled by considering it as a social institution for bookkeeping. This article outlines the four perspectives, lists materials for understanding each, and considers how some recent innovations in digital record-keeping fit into the picture.

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Cryptonetworks and Governments →

Public cryptonetworks have some unique features that put them in an ambiguous position vis-à-vis existing legal and administrative systems, especially governments. What should governments make of these emerging systems, and how might their societal role evolve in a cryptonetworked world? On the one hand, crypto represents an important and effective tool against authoritarianism, and certain aspects of it can arguably be framed as competitive with the State. On the other hand, it is also possible to envision a more symbiotic relationship in which well-intentioned governments are both active participants in and direct beneficiaries of public cryptonetworks.

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The Full Circle Hypothesis →

One thing more difficult than critical analysis is predicting the future. But here’s one possible scenario. While blockchain networks will continue to reinvent organizations that administer information and facilitate transactions connected to that information, on a societal level, the end result will look disturbingly familiar. I call this the full circle hypothesis.

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Blockchains are Bureaucracies par Excellence

In an earlier post, I likened decentralized networks to fields - social arenas of symbolic and material production within which interested actors compete and cooperate over network-specific resources.

The promise of blockchain and related technologies is that these arenas can be set up in ways that minimize trust requirements, reduce concentration of control over data, and enable free, censorship-resistant transactions in an increasingly global and automated setting.

In this post, I propose this development represents an important step in the evolution of bureaucracy. That may sound counterintuitive given this term’s common association with inefficiency and excessive paper-shuffling. But once we understand the essence of bureaucratic organization, it will become clear that blockchain networks are actually bureaucracies par excellence.

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Mario Laul

At the end of 2017, I started providing research support to Placeholder. It was a part-time role and I never took the opportunity to officially introduce myself via the blog. Better late than never!

I am happy to announce that I’ve now joined the team full time. In addition to supporting investment due diligence, my research efforts will focus primarily on the topic of cryptonetwork governance.

My background can broadly be described as social sciences. A few years ago, I completed my graduate degree in technology governance which translates to a mix of development economics, innovation studies, and public administration. Prior to my current role at Placeholder, I worked as a research assistant to Carlota Perez, focusing on the modern history of financial innovation and public policy in the UK, Germany, and the US. More recently, I had the opportunity to hone my analytical skills at the European Commission where I mainly worked with investment and financial data on one of the EU’s largest grant portfolios.

I’ve always had a keen interest in sociological theory, and each fall, I teach an introductory course on the sociology of culture to undergraduate art students in my home country of Estonia. I'm excited to leverage this background in my approach to decentralized networks, as I’ve previously done here.

Resource Distribution and Power Dynamics in Decentralized Networks →

“The idealized vision of more decentralized forms of networking and social coordination triggered by the invention of Bitcoin continues to inspire entrepreneurs and drive innovation. At the same time, it is increasingly acknowledged within the broader crypto community that though the idealists are onto something, these emerging social systems are far from immune to problems and inequalities that have plagued human institutions historically.

This raises a question: how to conceptualize decentralized networks and “decentralized autonomous organizations” (DAOs) in terms of resource distribution and power dynamics, and by extension, governance? One option is to think of these systems as fields, allowing us to use the well-established framework this term has in sociology.“

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