Abstract
Creating fair, transparent and genuinely democratic modes of decentralized decision-making has been a key concern for many developers and users of blockchains. This article evaluates several popular methods of maintaining consensus and achieving decentralized decision-making on blockchain networks in order to assess the extent to which blockchains challenge the norms of the liberal-democratic order. In particular, it compares and contrasts Proof-of-Work, Proof-of-Stake and Practical Byzantine Fault Tolerance consensus mechanisms, assessing not just how they operate in a technical sense but also (and most important) the political, economic and social dimensions of these different blockchain governance strategies. This comparison highlights efforts by blockchain communities to redefine or push the bounds of democracy, as well as the challenges they have faced in their efforts to create digital democracies that do not reproduce the same economic and social inequalities present in traditional democratic systems.
Highlights
Francis Fukuyama famously argued in 1989 that the world had stumbled into “the end of history”
Due to the ways in which Proof-of-Work privileges individuals and groups who enjoy an advantage in resources compared to their peers, blockchain governance based on Proof-of-Work would appear not to challenge liberal-democratic institutions in the way Bitcoin’s creator apparently hoped as much as to embody their shortcomings
Blockchain has been idealized by some of its proponents as a way to build political and social modes of organization that are fairer than those that exist in non-digital democratic realms; the various blockchain consensus protocols developed to date show that fairness and egalitarianism can be elusive even in digital communities that have no central governing authorities
Summary
Francis Fukuyama famously argued in 1989 that the world had stumbled into “the end of history”. The resurgence of Russian territorial aggrandizement, and the global ascendancy of a China that hardly fits the liberal-democratic framework, have been cited to dismiss the meaning that Fukuyama affixed to the collapse of the Soviet Union (Tharoor, 2017) These criticisms are valid, but for two main reasons, they don’t present a full picture of the threats that the liberal-democratic order faces today. A study of how members of blockchain communities think about democratic norms and values reveals two key insights into the state of liberal democracy today that conventional analyses of the end of history thesis miss They show that it is illiberal politicians and state actors who pose a threat to the liberal-democratic order as Fukuyama conceived it. In theorizing new modes of self-directed community governance, blockchain enthusiasts seek to pioneer novel strategies of social and political organization, marked by heavy investment in the concept of decentralization and the leveraging of digital technologies and processes to make possible modes of collective decision-making that would not be feasible in most non-digital contexts
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