Blockchain utopia and its governance shortfalls

Kohl, Uta (2021) Blockchain utopia and its governance shortfalls. In, Pollicino, Oreste and De Gregorio, Giovanni (eds.) Blockchain and Public Law: Global Challenges in the Era of Decentralisation. Edward Elgar Publishing, pp. 13-40. (doi:10.4337/9781839100796.00007).

Abstract

This chapter sows seeds of scepticism about blockchain governance and liberation narratives. It starts off by locating these narratives within a long standing history of utopian thought on technology and law and the recurrent promises of science-driven, technological replacements of law and the State, on and off since the Enlightenment. The discussion then explores the peculiar features of blockchain technology upon which its utopian credentials are said to be grounded. First, it argues that blockchain utopias are, much like their internet predecessors, guilty of technological essentialism by drawing determinist conclusions from an underlying architectural design, and by failing to allow for the functional and technological latencies within that design. It is in their interactions with social domains that those latencies are ‘resolved’ in favour of certain configurations and not others. Such utopian narratives are not harmless when they generate blindfolds about the actual societal concretisation of the technology and its oppressive rather than emancipatory effects. Second, the discussion problematises the claimed virtue of blockchain applications as trustless systems against various conceptions of trust, and argues that blockchain does not and cannot speak to the trust questions at the interface between information and reality, for which society will continue to require trusted third parties to deliver ‘trusted’ value judgements. Furthermore, it is not a foregone conclusion that a society in which trust becomes redundant or less important would in fact be an ideal society. Third, the chapter questions the virtues that lie behind blockchain’s decentralisation theme by arguing that the corporate structure has rather successfully formalised collective action and invariably opted for centralised decision-making for coordination and functional specialisation. Moreover, the decentralisation that blockchain enables within an organisation does not touch upon economic concentration within a market, but it is the latter that presents the real 21st century challenge to the marketplace and democracy.

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Contributors

Author: Uta Kohl

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