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  • Martin Schmalzried

Digital sovereignty, online democracy and collective will


Democracy, in our modern societies, has only been around for a little over two hundred years, yet most of us live as if it is a normal part of our institutional landscape. Nation states emerged also only in the last five centuries, rising up from the medieval ages kingdoms and principalities mosaic. The combination of the consolidation of nation states, culture, language, identity and borders linked to sovereignty, very often through much violence and bloodshed, laid the foundations upon which representative democracy could reemerge.


Today, representative democracy is in crisis. Many start to question whether elected representatives really do represent the will of the people who elected them. This realization has especially surfaced with the coronavirus crisis, where not a single so called “democratic” state has bothered to consult the population on the drastic measures taken. Democracy has been ignored many times in the past, for instance when the French people rejected the EU constitution by referendum. But the blatant and open disrespect for the very principle of democracy following the coronavirus crisis is on another level altogether. Not a single referendum, not a single public consultation, barely a few polls to evaluate how people feel about the measures adopted by governments. The veil has been lifted and behind the democracy simulacra we find a technocracy: the rule of “experts”, read a handful of virologists who, unsurprisingly, take decisions based on the “where you sit is where you stand” principle. It’s as if you consulted only a clique of zealous military generals to decide whether to go to war or not. Their opinion might not come as a big surprise.


While Trump’s claims for electoral fraud appeared farfetched and unfounded, recent elections in many modern western democracies have been riddled with controversies, calling into question the legitimacy of their outcome. To name but a few:

  • The first Trump election campaign and the involvement of Cambridge Analytica using targeted advertising to influence voters with dubious advertising techniques, harnessing people’s psychological vulnerabilities and emotions;

  • The Brexit campaign full of populist claims and misleading arguments;

  • The French campaign which brought an obscure and unknown person (Macron) to the fore via a surprisingly suspicious media coverage, being on the front page of nearly every single magazine in a positive light, in a country where nearly 90% of all media are under the control of a few billionaires.

Representative democracy rests on several principles among which:

  • The social contract, where people voluntarily agree to give up their agency and control over certain actions (like that of delivering justice by themselves), in exchange for certain benefits delivered by the state;

  • The respect of certain fundamental rights (human rights, constitutional rights…);

  • Free and open elections.

If all of these are respected, then citizens willingly agree to defer to the state a certain portion of their agency. If some of these principles are not respected, then in most democratic constitutions, originally, people had the right to “resist”, even going as far as overthrowing the government. This “right to resist” has been taken out of most modern democratic constitutions as it seemed “archaic” and useless given how modern democracies delivered justice and protected people’s rights. But the backsliding witnessed in the last few years has prompted many to call for a breach of the social contract and has fueled violence in the form of protests and movements. Examples include the #BlackLivesMatter movement, which denounce the failure of the state to protect the rights of some of its citizens, or the #GiletJaunes movement in France, which contested openly the legitimacy of the current government and underlined the state’s failure to fulfill its part of the social contract, throwing the “poor” under the bus to serve private interests.


Are these infringements on democracy enough to call into question the legitimacy of governments and their institutions? Who is to tell! Unfortunately, there isn’t a “galactic council” or a higher authority which can rule on these questions. At best, the European court of human rights in Strasbourg did condemn several democratic nation states for breaching their own principles, for example, condemning Belgium on its treatment of a migrant mother and her three children. But has it changed anything? Has it prevented further slip ups and improved the treatment of migrants? Hardly. Does this constitute a valid reason for legitimately raise the “right to resist” and openly oppose the validity of governments’ democratic legitimacy? Calling into question their right to take action “on behalf of the will of the people”?


Perhaps these questions can be answered in a very practical way: via the emergence of decentralized online governance structures.


Blockchain technology has only been around for a decade, and yet, it has already spurred many innovative projects and tools. Decentralized governance is one of the features that come with a public decentralized use of blockchain technology. At present, calling decentralized governance “democratic” or suitable to represent the collective will of all participants in a decentralized network is risible. Looking at projects like Bitcoin, governance is in the hands of a select few key players, lead developers, wealthy mining pools, while the massive amount of users merely passively endure the effects of decisions taken without any regard for their opinion. Their only power is boycott: selling their Bitcoin and choosing a different project. While it may seem trivial, it shouldn’t be disregarded. In the offline world, one cannot “boycott” decisions of states in such an easy manner. Try selling your house, quitting your job, renouncing your citizenship and applying for citizenship in another country as a response to a controversial decision by your government. Decentralized governance is in its infancy, and while many could brush it off as the delusion of “crypto-utopia” or “tech utopia”, they would do well to remember the history of our own so called “representative democracies”, which have only barely matched their actions with their title for a few decades. Most democracies started with a census suffrage where the rich would get more influence in their voting power than the poor masses. Reminds you of anything? Bitcoin’s current governance perhaps? More shockingly, women couldn’t vote until the early to mid 20th century in many “modern” representative democracies. That was just roughly 100 years ago or less.


It can be understandably frustrating for many people that after centuries of struggle, violent revolutions, we should turn away from “physical” institutions and their legitimacy and turn our attention to virtual communities. “We have fought so hard to bring about representative democracies, with the rule of law, in respect of human rights! We can’t just call into question the legitimacy of these institutions to act on behalf of the will of the people!”


Of course, we are not getting rid of our “physical” institutions any time soon. But the emergence of self-governed decentralized online communities could represent an interesting counterweight and contribute to a new balance or separation of powers, on top of online petitions and protests, to keep these institutions in check, and make sure that they do in fact, serve the interests of people, truly represent their collective will as opposed to the will of the few (whether these few are a handful of arbitrarily chosen technocrats or a handful of ultra-rich with good political connections). It should come to no surprise that governments will try to regulate the crap out of decentralized projects, be it because they represent a potential alternative to their centralized debt based system (which is just as much in crisis as representative democracy) or because they threaten the governments' monopoly in embodying the collective will of the people and speaking in their name. Monopolies don't like competition, and will do anything to prevent any competitor from emerging. Common strategies are bringing the competition under its fold (in the private sector buying up competition, like Facebook bought Whatsapp, in the public sector, regulating the crap out of these alternatives making sure they are no longer a threat) or nipping them in the bud by banning them, prosecuting them etc.


Online petitions, for instance, are a “one shot” form which represents the idea or position of a person at a given time. It doesn’t require personal involvement of any kind, like taking action, only signing the petition (as opposed to a physical protest which requires a person’s physical presence). Decisions taken within decentralized governance structures have the potential for representing the dynamic shift of positions and opinions of a collective, requiring much more involvement than signing an online petition. Some examples include:

  • Blockchain projects relying on “Proof of Stake”. Staking requires a personal financial involvement, and keeping your stake alive, maintaining the hardware/software required to stake, is a proof of support for that project. Right now, financial incentives might carry too much weight in the reasons for the support for such a project, and also represent an oligarchic structure where the people controlling most of the currency have the most power in deciding the rules.

  • Governance tokens also represent an important potential for the emergence of decentralized self-governed communities. A governance token represents a “right to vote” on the future rules and updates to the decentralized projects’ code/protocol. And once again, how governance tokens are distributed and who controls them is key.

  • Smart contracts also have the potential for facilitating the emergence of self-governed decentralized communities, via the collectively agreed upon configuration of a smart contract which will then enforce, with 100% certainty, whatever action or rules that the community decided.

  • More generally, the process of updating code and protocols of a project reflects a more or less democratic and participatory approach: many projects have a close knit relationship with their users and created various channels for receiving input. Whether a Discord channel or through a tool helping to map and collect suggestions for improvement, coupled with a transparent selection process for suggestions for improvement, continuous dialogue and communication about their plans for the future, all of these seem much more democratic and participatory than what can be observed from the attitudes of most democratically elected governments, who take an interest in what people think a couple months before elections.

In the future, decentralized governance protocols might evolve towards a more balanced and democratic decision making process, simply through a form of “natural selection”. People/users will support and engage with projects that respect their opinions and provide them with meaningful ways to get involved and participate proactively in determining how that project will evolve in the future. Reflecting today how certain high level principles like that of human rights can be transformed into code within a decentralized governance structure is therefore of utmost importance. In the future, there is no reason why governments should be the sole actors or institutions representing the legitimacy of the collective will of their citizens and with the legitimacy to act on their behalf. How does the principle of sovereignty translate into the digital space? How does it interact or overlap with “physical” sovereignty? How will various decentralized self-governed communities interact with each other? Will they also form some kind of overarching supra-national rule of law enforced in a patchwork fashion like the United Nations? Or will a hierarchy between these communities emerge? Will certain decentralized self-governed communities willingly adhere to a series of codes of conduct implemented in code, or inherit certain “rules” by delegating part of the functioning of the community to a higher level authority which will safeguard certain core principles such as human rights? Only time will tell, but the plethora of innovative projects emerging every day is a positive signal in my mind. It is also reassuring to notice that states have already faced similar dilemmas in the offline world. Examples include the Zapatist movement in Mexico, the Bruderhof Communities, the Amish and Mormons, and a wealth of other communities who were recognized by the state as having more or less autonomy even if they reside within their sovereign borders.


Of course, all of these questions are only relevant if we assume people care about their right to participation and democracy. Perhaps people could care less and only look at whether a project can make them rich or not. If that is the case, it begs the question of whether we should scrap democracy as an idea altogether. If a majority of people, whether online or offline, don’t care about their collective freedoms, rights, and prefer living under a technocracy coupled with an artificial intelligence, deciding for them what they should eat, how long of a shower they can take, and where they should sleep, that is fine. But let’s stop pretending then, and call a spade a spade. Look no further than the World Economic Forum’s “future vision” of the world, that is exactly what they propose: a handful of “experts”, or elites, which micro-manage everything with the help of an AI, and where everything is taken care of. Something that looks suspiciously like a Zoo, where the people are the caged animals and the caregivers are the various “elites” and technocrats appointed by the WEF.


Of course, things do not have to be black or white. There is a wide spectrum between Ancient Greek style citizenship which made participation mandatory (if you were a citizen), and Roman style citizenship when you were conquered by Rome and lived under Roman law, but with no right to participate at all. Decentralized governance will have to take into account the varying interest and willingness to participate proactively in governance of its community of users. While some will be very proactive, others will only complain when things go wrong, and others still will simply leave without saying a word. In this regard, experimentation and diversity will be key. One core principle that all decentralized governance communities should put in place is an easy "way out" through data portability and interoperability with other similar services, to allow users to "vote with their feet" and avoid replicating the same "lock in" effect as observed in the current centralized communities, where people stay because "all their life, data and friends are there".


Decentralized governance should also come with some kind of "delegated voting" system, whereby users can delegate their voting power to a person they trust. Many decentralized communities include very active Reddit or Discord channels, with many knowledgeable and involved users. Users from decentralized communities could identify another active user who best represents their interests and delegate their vote to them. A comprehensive log tracking who voted for what should allow users to better allocate their delegated votes if they don't want to get involved proactively themselves. Finally, there are a plethora of experiences and experiments enabling decentralized decision making and fostering participation. For instance, Reddit is now partnering with the Ethereum foundation to boost its "reward" system for highly active users. Voting system can also help identify people who receive more or less approval from the community for their contributions. As far as decentralized collective decision making, there are also plenty of tools among which:

  • The "Abaque de Régnier" tool to help visualize voting and approval for various proposals.

  • The Kialo platform which is specifically designed for debate and reaching commonly agreed consensus on various topics.

No doubt that a "fair and balanced" decentralized governance system is not around the corner, but what is clear, is that this space has seen more innovation and diversity in decentralized governance than representative democracies in the last century. How these two different representation and collective decision mechanisms will interact with each other remains to be seen. Let us hope that our current democraties see these technologies not as a dangerous competitor questioning their unquestionable authority but as opportunities for reinvigorating our fatigued democracies, many of which have seen mounting populism, lower voter turnout, more and more distrust and disengagement from citizens, with the dangers of dictatorship on the horizon. Either we delve deeper into democracy and its principles, or we transition out of democracy and into technocracy, oligarchy or even dictatorship.

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