On Liberty Through Digital Utility
What is utility in a globalized world? Some may consider a utility in a physical sense, as a necessary service to promote a better life: clean water, energy, communication, and transportation infrastructure, all provide a foundation for a modern society to flourish. In a more economic sense, utility is the concept of 'usefulness' of a specific good or service.
By understanding the definition of modern utilities, how might Distributed Ledger Technology (DLT) modify our understanding of these concepts in the future? Utility tokens already exist; they are issued to fund the development of digital goods or services offered by the originator of the asset in both physical and digital spaces. This dynamic concept of a utility token may, in fact, provide a framework for the application of classical utilitarian philosophy in modern globalized economies.
Before such claims are made, it will be valuable to understand where exactly these ideas of utility originated. Jeremy Bentham (1748-1832) created the idea of utility as an aggregate of positive action towards the common good. His work has created the foundation for the modern philosophy of Utilitarianism, raised from the roots of the Era of Enlightenment during a time of rapid global industrialization and commercialization.
Bentham was fascinated with social reform from a legal, economic, and philosophical perspective as the world around him rapidly changed. He penned a rebuttal to the rebellious United States Declaration of Independence, from both a hybridized legal and philosophical standpoint under a pseudonym, and yet he also supported the early concepts of classical Liberalism during the earliest days of the French Revolution.
His exposure to each of these systems and their intricacies inspired more domestic reforms. During this time, Jeremy Bentham quickly became respected around the world as a socioeconomic and legal philosopher. Energized, Bentham turned his focus towards the UK where he helped establish the concept of 'preventive police' developed around a dedicated patrol force that would act as deterrent to criminality along the Thames river which was a notorious spot for theft of goods from moored ships moving commodities and information around the world.
Inspired, Bentham then expanded upon his blossoming social justice theory with interpretative designs for a modernized prison system, which he called the Panopticon. The concept was once again related to the prevention of bad behavior before it was acted upon; his designs encompassed a circular prison, with a single guard tower in the center, designed so that the prisoners couldn't see the guard while the guard could see every prisoner; when their limited attention was directed to any block of cells.
With this structure in place, Bentham argued that prisoners would naturally assume they were being watched, but never be able to tell exactly when the guard's attention was focused. As such, inmates would be less inclined to be disruptive. Bentham's prison experiment never truly got off the ground, at least in his lifetime, but his theory rapidly evolved to become the foundations for modern surveillance and intelligence structures to expand.
Learning from these past experiments, we can apply some of Bentham's theories to a modern distributed system. Utilitarianism may be a model to explore utility as a measurement of liberty itself in a distributed system, more-so than a way to discreetly track the exchange of commodities, securities, or even digital assets between peers.
We know goods and services already move within these developing systems and yet, there seems to be a growing conflict around *which* goods and services should utilize the technology; further, who should have authority over such systems as they scale in the age of information?
Bentham proposes the less restricted a utilitarian system is for any individual the better it becomes for all individuals, especially if each party is seeking to expand their own liberty without limiting that of their peers. But, can liberty truly exist in a system where authority is dynamically defined – unique to each jurisdiction it might serve? Let us explore an idea around the abstraction of authority away from the individual, or any centralized group of individuals in the form of an organization or jurisdiction, and towards a liberty-utility contract operating dynamically between all peers and spaces equally.
Utilitarian contracts represented as smart contracts may interact in a digitally egalitarian system without creating conflict at a higher degree than an intrinsically centralized system. If they succeed, new systems of governance must also exist to enable these process-based systems to interact across traditional borders, while also limiting friction between modern and legacy systems. An even greater value proposition is possible if these actions could occur without introducing unnecessary complexity or additional costs.
As these new digital utility systems are developed, new forms of organizations may find their spotlight on the world's stage as modern standards are redefined globally. These dynamic constructs, known as Distributed Autonomous Organization (DAOs), have a checkered past and a promising future. These process-centric constructs help data driven systems communicate securely by coming to consensus around rules and procedures that govern smart contract interactions. They also bring renovations towards efficient conflict resolution, and distribute value back to individuals and other traditionally structured organizations such as non-profits.
With these rapidly distributed digital interactions defined, a comparative model for blockchain utility, based on the concepts of classical utilitarianism is made possible. Where the least restrictive limitations, that offer the most value to the most number of users, become the framework for governance in a dynamic socio-economic system. Centralization in this technology stack is not only theoretically limited but structurally so. This decentralized nature may offer the most potential value for users who begin to store their own utility within it, thus helping to redefine the ecosystem in which they exchange their own labor for assets as a form of payment.
With global attention focused on advancing distributed finance across borders, in light of recent pandemic responses from traditional governance models, the time for assessing the calls to protect the value of liberty in relation to utility continues to grow. With the right philosophy, an expansion of liberty through utility may increase the value of the economies they service without limiting the freedom of their peers.