Crypto Law Review
Contextual Quote
"Lexscapism: belief that it’s possible to extricate crypto from existing Law (legal forms, processes, institutions, etc.) & that we should (Buterin: “[Blockchains are] digital institutions with no central coordinator and not bound to any single jurisdiction.”)"
- Crypto Law Review [1]
Description
"Over at Crypto Law Review, we’re hard at work mapping CryptoLaw and sketching out different crypto legal theories.
We’re basically trying to figure out
(1) how crypto fits within existing social orders,
(2) how crypto seeks to change current social paradigms, etc. As important, we focus on
(3) how existing frameworks seek to change crypto."
(https://medium.com/cryptolawreview/the-crypto-soviets-2f7d0a5f81fd)
Characteristics
Crypto Law Review:
"In order to outline something approaching a working theory of CryptoLaw (why it exists; where it’s going; etc.), we need to zig-zag across several lines of analysis, including:
(1) the institutional origins of CryptoLaw (“Crypto Legal History”);
"CryptoLaw is the bastard child of two quintessentially human impulses:
(1) human search for Clarity; and
(2) human love of Liberty.
If only crypto folks had allowed Clarity + Liberty to live their best lives, we never would have had a need for CryptoLaw. In that case, crypto networks and processes would have continued their viral spread over and into virtually all existing PC (#precrypto) processes —including socio-economic processes and phenomena like Law.
But CryptoLaw’s “bastard” fate is traceable to Liberty’s cousin —
(3) MOA (Mistrust of Authority) — who found a way to creep into the nuptial embrace between Clarity and Liberty to sow the seeds of …
(4) Anarchy.
MOA crept in and wound its way around crypto’s pillars of creation by sowing irrational fear of Law — even though Law was and is nothing more than a reflection of ourselves.
(2) CryptoLaw’s ideological/theoretical foundations (“CryptoLaw as Ideology”);
"Crypto FUD (Fear, Uncertainty, Doubt) with regard to Law stemmed from crypto developers’ misunderstanding of law.
- We’re not sure yet whether to blame, Nick Szabo for this or other early crypto theorists with legal training and/or a grudge against the “State.”
But we can see misconceptions about the nature, function and limits of Law (and particular legal forms, processes, and institutions) in the very lexicon of crypto’s founding articles: the Bitcoin Whitepaper, the Ethereum Yellowpaper, the EOS Constitution, and so on.
Satoshi Nakamoto might have intended for Bitcoin to serve as a new, sui generis, proto-crypto-legal construct. But Nakamoto employed an utterly conventional rule-based logic, aka Law, as the delivery vehicle for introducing Bitcoin’s revolutionary blockchain processes to the world.
[Wannabe Bitcoin outlaw] ought to find it more profitable to play by the rules, such rules that favour him with more new coins than everyone else combined, than to undermine the system and the validity of his own wealth.
In hindsight, it becomes so clear that Bitcoin honest node v. attacker node binaries were background legal norms as much as conceptual heuristics.
Binary legal logics became even more pronounced in the Ethereum project. Ethereum is also where binary socio-legal theory started getting spiked with different ideological loads.
Bitcoin then begat Ethereum; and Ethereum begat CryptoLaw proper.
Here’s how Gavin Wood, a co-founder of Ethereum, describes the birth of CryptoLaw in the Ethereum Yellowpaper:
[We need CryptoLaw to] “facilitate transactions between consenting individuals who would otherwise have no means to trust one another. This may be due to geographical separation, interfacing difficulty, or perhaps the incompatibility, incompetence, unwillingness, expense, uncertainty, inconvenience or corruption of existing legal systems.”
We’ll come back to revisit these ideological and empirical assumptions in Wood’s analysis. There’s a lot to unpack there — particularly in the last part.
But for now, it’s worthwhile to replay the transcendental moment of CryptoLaw’s birth. Here is Wood, again:
Early work on smart contracts has been done by Szabo [1997] and Miller [1997]. Around the 1990s it became clear that algorithmic enforcement of agreements could become a significant force in human cooperation. Though no specific system was proposed to implement such a system, it was proposed that the future of law would be heavily affected by such systems. In this light, Ethereum may be seen as a general implementation of such a crypto-law system.
* CryptoLegal Baby Steps
In three quick progressions, crypto went from (1) Clarity (Bitcoin’s algorithmically clear mutually beneficial “rules”), to (2) Liberty (Ethereum’s premise of consenting individuals with legal personality) to (3) Mistrust of Authority (“algorithmic enforcement” = “human cooperation” = good; “human enforcement” = “existing legal systems” = bad).
From there, Crypto’s Law FUD snowballed — manifesting itself as reflexive background mistrust and increasing antagonism towards existing legal systems and institutions.
Before long, Law wasn’t just costly or inefficient; it was also potentially immoral or even dangerous.
...
For early Ethereum developers, it apparently wasn’t enough to say that “Law sucks! — ” Many Ethereum developers decided to go after law offensively by claiming to possess “autonomous enforcement” power.
Here is Wood again:
By specifying a state-change system through a rich and unambiguous language, and furthermore architecting a system such that we can reasonably expect that an agreement will be thus enforced autonomously, we can provide a means to this end.
3) CryptoLaw’s relationship with existing legal practice, globally (“CryptoLaw as Practice”);
"1. Binary Logics v. Non-Binary Law
The section above traced the history of CryptoLaw. But the binary legacies of those constitutive moments continue to inform and structure our legal imaginaries today.
When the phrase “CryptoLaw” is mentioned, what still comes to mind are binary logics and binary frameworks:
(1) Regulators v. Crypto;
(2) LawLaw (esp. law enforcement) v. CryptoLaw (see, e.g., #FreeRoss);
(3) CryptoLaw Version A (ETC) v. CryptoLaw Version B (ETH);
(4) “SmartContracts” v. DumbContracts; etc.
However, straight off the bat, the binary approach to thinking about CryptoLaw is flawed because law is not binary.
We all know that flawed binary logics produce flawed legal frameworks — which are extremely difficult and costly to correct after the fact.
And yet we still cling to superficial and unsatisfactory frameworks. ...
In hindsight, flawed binary frameworks (Crypto v. Law; followed, predictably, by Law v. Crypto) are what produced the very field of CryptoLaw. This was unnecessary and continues to prove counter-productive.
Crypto had every opportunity to stealthily subsume and colonize Law on both hyperlocal and global scales — just like the Internet subsumed and colonized Law.
Today, we don’t have a separate field of “Internet Law” because Law, as such, is now unthinkable without the Internet.
As a technology, the Internet’s hyperutility went far beyond communication. The Internet also challenged and redefined established conceptions of jurisdiction, security, law enforcement, governance, and so on.
Internet pioneers didn’t just dictate the “law of the Internet” (in the sense of law that would govern them); Internet pioneers seized an opportunity to rewrite ground rules of world order, including core operating rules for global markets in goods and services.
That could have been the case with crypto, but it’s not that case with crypto — at crypto’s election."