Cryptocurrency

Historical perspective by Michel Bauwens

Reference - New Network Sovereignties: the rise of non-territorial states?

A phased interpretation of the role of crypto-based institutions.

Dating from the invention and development of the microchip technology (from the 1970s onwards), digital technologies are initially used by corporate and state institutions, laying the groundwork for the coordination of global supply chains by large private commercial firms, aided by trans-national financial flows and the neoliberal institutions of the Washington Consensus.

In 1993, the invention of the browser and the Web democratized the conditions of access to the internet, and created a massive push for the mutualization of shared knowledge, code and design. This is the emergence of commons-based peer production as first defined by Yochai Benkler, and of the open source / free software / open design ecosystems, which succeeded in creating global ‘holoptical’ ecosystems for the global coordination of associated labor. But the open source paradigms, with its copyleft licensing scheme that allows the entry of large corporations, while leaving the core of the network collaborators and maintainers unpaid or underpaid, create the conditions for the corporate influence in these corporate ecosystems. Nevertheless, the creation of a joint set of infrastructures for the global coordination of labor outside the control of single firms and governments, is a major pivot in the history of the productive forces.

The invention of Bitcoin, as the first globally scalable and socially sovereign currency, with its blockchain and then all the other crypto-based derivatives, is a major second step. Whereas open source allowed for the distributed coordination of labor, crypto-based self-infrastructuring created the conditions for the payment of that open source and community-based cooperative ‘neo-Venitian’ labor and capital. Paradoxically, its ‘capitalist’ and speculative elements at the same time insured a flow of capital. In a second step, forces in the crypto economy, found solutions to finance their own commons-based developed, inventing techniques for the financing of ‘public goods’, often using partially ‘anti-oligarchic’ systems of collective choice.

This occurred at the same time as the exponential rise of mutual provisioning systems in the declining urban systems that Michel Bauwens has documented in a report for the commons transition in the city of Ghent, Belgium, and which is creating a first generation of ‘cosmo-local’ productive ecosystems, which have been described in the ‘Cosmo-Local Reader’. Indeed, whereas most commons-centric city initiatives are still focused on the consumption side (mutualizing use of capital-produced goods), the new cosmo-local initiatives have started considering production itself. What is missing, as the third stage of digitally enabled global productive networks, is the potential fusion of productive ecosystems with the coordination infrastructure developed by crypto communities. We are far from having achieved this, but there are some signs of initiatives going in that direction, such as a planned Gitcoin funding round on distributed manufacturing that will be coordinated by Sensorica.