Blockchain society comparison: from state nations to cryptocurrency to sovereign societies

5 min readMay 31, 2019

Sovereign societies will be run using blockchain technology. This article will briefly look at how current state nations look like, current attempts at sovereign blockchain societies and what the future may hold. Finally, it will explain why building identity and reputation into the digital societies of the future is needed to create ethical, environmental and economic sustainability.

What should a society achieve?

Good behaviour: we treat each other and the environment fairly and with respect.
Sustainable economics: we collaborate to achieve our goals, we specialize in certain tasks and buy goods and services from each other to achieve better living standards.

Present to future

Present: state nations

The current human structure for organizing human societies involves a “government” body of people, that creates the rules that the people “citizens” abide by.

The governments control the nation’s finance (via inflation, fines etc) as a primary tool to incentivise sustainable behaviour and economies.

Problems:

The centralization of power to run a country to one government (or in some cases one person) leads to corrupt behaviour where they act in favour of their own interest over the interests of others.
This leads to a distrust of the people in the system, and to a society level loss of good behaviour and reputable economics.
The set of laws needed to govern a set of people become complex and a major burden for society to adhere to, which decreases economic activity.

In progress: anonymous cryptocurrency

Cryptocurrencies create an interesting solution which is to create a level of finance that is not controlled by governments or banks. This is achieved by creating anonymous digital money that is not controlled by any one entity.

The rules of the cryptocurrency, protected by math through cryptography, create trustworthy financial incentives to let humans interact without the need for a central party to control the system.

Problems:

Cryptocurrencies and anonymous open blockchains rely on crypto-incentives as the primary mechanism to incentivise good behaviour. Using financial incentives only removes social accountability to each other, causing decisions that are not based on human ethics. This is evident in the lawless bot-driven trading, pumping and dumping that currently occurs in crypto. Curiously, the loss of social accountability can also be seen at the global corporation level, where companies lose a human reputation element when they get larger.
In a world where no fiat currency exists, governments are left with no mechanism to incentivise good behaviours.
The current paradigm of open blockchains, run on protocols such as Proof of Work (Bitcoin), Proof of Stake (Cardano) or Delegated Proof of Stake (EOS) let the people with the most money, make the decisions.

In progress: private blockchains

Private blockchains use the same technology as cryptocurrencies but are run in a permission private way that is not open to the world. Such technology offers greater efficiencies for the banks and governments, but do not change the current norm for social structure and hence do not address any of the major problems that humans face in the current paradigm.

The future: sovereign identified societies powered by blockchains

Public blockchain technologies (cryptocurrencies) remove that power away from the governments and banks, but in doing so remove social accountability to each other.

A human identity linked to blockchain actions allows both sustainable financial and social accountability to each other, without the need for a central party to manage the system!

The identity of the person should be sovereignly controlled by that person, and not anyone else for this to work. The identity should be visible only to those that the person is transacting, and links their reputation to their identity.

Furthermore, an identified blockchain network allows the possibility of verifiable democratic voting, to allow for truly human-powered governance.

This creates a new structure of society that

is simpler: social accountability and reputation enforce good behaviour instead of complex laws.
is more efficient: the overheads of complex laws do not burden society.
is fairer and has more freedom and trust: people need not feel subject to the power and rules of the controllers of the system.

Current attempts at identity-powered open blockchain societies

Decentralized digital societies

A digital peer-to-peer society where people’s lives and data are not controlled or monitored by a big-brother-like entity while still supporting humanity, and incentivizing good behaviour and economic sustainability.

This is my own project and it differs from the other three mentioned here in a few ways:

Focus on scalability and usability through the use of EOSIO blockchain technology
Emphasis on creating value within an existing ecosystem (EOSIO), and collaborating with existing projects
Modular approach (quite similar to Ontology and IOP)
Integration of a flexible sovereign data solution at the base layer to support both a sovereign identity and reputation for everyone