Radical Markets: The Good, The Bad, And The Blockchain

Glen Weyl is a researcher at Microsoft and the co-author of “Radical Markets: Uprooting Capitalism and Democracy for a Just Society” (Link). He also recently co-authored a paper with Vitalik Buterin and Zoë Hitzig. Earlier this week the Philly Blockchain Tech meetup, which I help co-organize, was lucky enough to have him as a guest!

In this post, I’ll share some thoughts on Glen’s proposals. In particular I want to touch on what I like about them (“The Good”), where I’m more skeptical (“The Bad”), and why I think they mesh well with the ethos of the emerging crypto culture (“The Blockchain”). If you’re not familiar with Glen or his ideas, check out the recording of his talk at Philly Blockchain.


The Good

To put it simply, Glen and his co-author are thinking big. These are not run of the mill calls for narrow reforms or slight tweaks to our existing systems. The proposals laid out in “Radical Markets” are, well, radical.

If nothing else, then, the book is valuable because it demands you imagine a world that is profoundly different from the status quo. It is “mind expanding” in that it forces you to reconsider your baseline assumptions, many of which you won’t realize you’re making until they’re illuminated.

The book is also refreshingly non-partisan, existing outside the bounds of the tired right-left battle lines drawn in our increasingly unbearable political sphere. No doubt, someone out there will try to force the ideas into one camp or the other, but an honest reader recognizes they are orthogonal to the trite, tribal arguments that have become typical.

As one example, how many authors have you read recognize the moral imperative for allowing broader migration, while also acknowledging the benefits of migration generally accrue to the wealthy and to the migrants— at the expense of the working class in the host nation?

Rather than descend into name calling or moralizing on this divisive issue, Glen and his co-author suggest an alternative system, wherein all members of society might benefit from migration. The citizen-sponsorship program for which they advocate struck me as perhaps the most workable of the book’s proposals.

That said, I also appreciated that Glen and his co-author “swung for the fences” rather than limit the book’s ideas to those which seem politically feasible.

The Bad

This leads to the simplest— but also least interesting— criticism of the ideas in “Radical Markets”, namely that they’re impractical. I say this criticism is uninteresting not because it’s wrong, but instead because it’s right, and Glen and his co-author know it. They acknowledge the ideas need to be tried in small scale experiments, and that much advocacy would be required before any broader adoption.

A slightly more interesting criticism of these ideas is that they’re too optimistic about the extent to which “mechanism design” can be employed to create or shape markets. While Glen and his co-author are in no way proposing a centrally planned system, there is still a whiff of the central planner’s hubris in the idea that more efficient markets can be designed, and better outcomes can be engineered.

As a Software Engineer, I’ve learned this the hard way. When rearchitecting even a simple system, one is often surprised by the second order effects of seemingly small changes. What’s true for software is even more so for society— there may be unseen reasons for so-called inefficiencies, and we may be surprised by the repercussions of trying to “design” them away.

One final piece of criticism I have is directed specifically at the idea of using Harberger taxes for personal property.

I asked Glen at the Philly Blockchain event if we might be missing a moral component to purely private property. Might there be some inalienable right— whatever exactly that means— to own outright the fruits of one’s labor? Is it morally wrong to, say, force an elderly widow to sell her house of 50 years— even if you’re compensating her fairly for it?

Glen’s answer to this question was that companies might spring up to provide services to handle such cases. For example, a company might cover taxes on a high valuation in exchange for inheritance rights to the property, thus decreasing the likelihood a widow would be forced to sell if she didn’t want to. This answer is reasonable, but perhaps misses the deeper point.

The Blockchain

What excites me most about the ideas in “Radical Markets” is their possible application to decentralized crypto-networks. Unlike our existing economic and political structures, we’re building the world of the blockchain from the ground up. It’s a great opportunity to question assumptions and experiment with new ways of doing things.

While I may be skeptical of applying Harberger taxes to property, for example, they could be a great fit for “ownership” of digital namespaces.

As we build new kinds of decentralized organizations coordinated by blockchain based interaction, Quadratic Voting may prove a useful mechanism for governance.

Blockchain enabled products could recognize “data labor” and compensate users for it— the Brave Browser and the Basic Attention Token may be a harbinger of this.

The possibilities are endless and exciting. Furthermore, such experimentation in the context of crypto-networks could help prove these ideas out, making them more viable for application in more traditional settings.

Even more fundamentally, I think the core premise of “Radical Markets” fits well with the spirit of the blockchain community. Glen and his co-author are clearly concerned about the increasing concentration of power found in the modern world. The impulse to find ways to diffuse that power aligns well with the ethos of decentralization which underpins crypto. I’m excited to see where these ideas might go.

The Two Views Of Crypto: Sound Money Vs. Global Computer

Each of us has a unique personality and history that influences the way we perceive the world-- our own set of lenses through which we view reality.  It turns out, those lenses can result in dramatically different conceptions of the same phenomenon.

It will Shock some of you To Learn all three versions look 100% Gold & White to Me ¯\_(ツ)_/¯

It will Shock some of you To Learn all three versions look 100% Gold & White to Me ¯\_(ツ)_/¯


In the crypto world, amongst those who believe this technology to be lasting and important, there seem to be two dominant viewpoints. In this post, we'll elucidate these two lenses, explore what each perspective gets right and wrong, and seek to unify the two if possible.

A World Computer

Many people view blockchain networks as giant, decentralized, global computers. Henceforth, we'll call people who tend toward this perspective "Computerians". (It's a dumb name, but I really don't want to type "people who have this perspective" over and over, so let's go with it).

A blockchain computer is everywhere and nowhere. Code IS run and State is Replicated across Thousands of Nodes

A blockchain computer is everywhere and nowhere. Code IS run and State is Replicated across Thousands of Nodes


Computerians tend to be developers and software people. They recognize blockchains as a new place to run their code and store their data. Compared to traditional computers, blockchain computers are wildly inefficient, expensive, and hard to program safely.

Despite this, Computerians are excited to write software for these global computers, and believe this software will change the world. Thats because they recognize a host of new capabilities these computers bestow on software, namely:

  • Digital scarcity
  • Data storage that is immutable, auditable, and censorship resistant 
  • Code that is unchangeable once deployed (i.e. the ability to provide guarantees to users about how a system will behave)

To put it succinctly, Computerians believe software is eating the world-- blockchain computers enable them to write new kinds of software and thus devour parts of the world previously thought indigestible.

Sound Money

In contrast to the Computerians, there are a group of people who view blockchain as primarily a monetary innovation. For these folks, "blockchain" is an implementation detail. We'll call them the "Fiscalites."

Is Bitcoin a Better Gold Than Gold?

Is Bitcoin a Better Gold Than Gold?


Fiscalites are more likely to have a background in economics, finance, or political science. They understand that, historically, things that become money-- like shells or precious metals-- have had certain properties, such as:

  • Durability and secure-ability
  • Measurability and divisibility
  • Forgery resistance

Looking at cryptocurrencies, Fiscalites recognize them as a revolutionary new form of sound money. Fiscalites tend to be skeptical of fiat money, that is, money issued and controlled by a government. They view centrally controlled, inflationary monetary policy as dubious.

Concisely, Fiscalites see cryptocurrencies as an ascendant new form of global money and the antidote to the questionable modern experiment of fiat currency.

Each Side's View Of The Issues

Unsurprisingly, viewing the world through these different lenses leads to different conclusions regarding various matters. Let's examine how each side perceives:

  1. The concept of cryptocurrencies
  2. Altcoins and other tokens
  3. Scaling and network upgrades


It should be self evident that to a Fiscalite, cryptocurrency is the whole ball game. The underlying blockchain technology is an afterthought. It's the sound money it enables that matters.

A Computerian views cryptocurrencies as a fundamental component of blockchain computers, but not as their singular end. A network's currency underpins the incentive structure that allows it to function in a decentralized manner, and it enables powerful use cases in the form of programmable money. While Computerians recognize the importance of these functions, the currency doesn't conclusively define the utility of the network.

Altcoins and Tokens

Fiscalites tend to be Bitcoiners. Since Fiscalites are focused on sound money, they see the network effects of Bitcoin as unstoppable. The more people who store their wealth in Bitcoin, the more its value increases, and the more likely others are to use it to store their wealth.

To a Fiscalite, unless a large number of people are willing to store their wealth in a given coin or token, it's useless. Most believe only one asset can accrue such broad social trust. An open minded Fiscalite might be interested in altcoins that improve on the money-ness of cryptocurrencies, such Zcash and Monero, but thats about as far as it goes.

Fiscalites Put Bitcoin On A Pedestal.

Fiscalites Put Bitcoin On A Pedestal.


As engineering minded folks, Computerians are more open to new projects which experiment, add features, and explore the blockchain tradeoff-space. As such, many of them are excited about Ethereum, but not exclusively so. They're multicoiners.

Computerians can envision a world where multiple blockchain networks see mainstream adoption, and where technologies like decentralized exchanges and atomic swaps allow users and software to transact seamlessly between them. Many Computerians even envision a world where a multitude of tokens and assets are implemented in code on top of these networks, each providing some narrow utility or incentive structure.

Scaling and Network Upgrades

Fiscalites don't want to change the network. Period. If the network can be changed, then theoretically it could be censored, broken, or have its monetary policy altered. This would damage its social credibility as money. For Fiscalites, intractable governance deadlock is a feature, not a bug, and suggesting a change to the network for scaling purposes is like proposing we alter the atomic composition of gold to make it easier to carry around.

Fiscalites want to scale the network on the second layer-- i.e. by leaving the base protocol untouched, but building on top of it, even if that comes with some tradeoffs. A historical analog would be government issued gold notes. They made using "gold" easier, albeit with some tradeoff towards trust. This was acceptable as long as there was an easy way to opt out of that trust by exchanging notes for physical gold.


Gold Notes Could Be Redeemed For Gold On-Demand


Computerians see scaling as an engineering problem, and one that must be urgently solved. If blockchain networks are all about creating new kinds of software, then we need lots of people to be able to use that software. These networks need to scale. As such, Computerians don't take an either-or view of scaling when it comes to layer 1 vs. layer 2. Why not both?

Naturally, this means lots of changes to the network. "Fine, let's get to 'em," says the Computerian. Even changing the monetary policy is not off the table in service of making the global computer work better.

What Each View Offers The Other

As we've seen, Computerians and Fiscalites seem to disagree on quite a lot, despite both being bullish about the overall importance of crypto. The truth is, the two views are complimentary, and each is necessary to keep the other in check.

We are the proverbial blind men, each feeling a different part of the elephant while arguing over its nature. We ought to be triangulating our viewpoints.

The Blind Men and The Elephant, Via Wild Equus

My background lends me to a more Computerian disposition. I've come to realize there is much we should learn from our Fiscalite friends.

Computerians ought to take more seriously the history of money, and tread more carefully with regards to network changes as a result. The Ethereum DAO hardfork makes a good example of where this can go awry.

To an engineer, the hardfork felt like fixing a bug-- correcting a piece of software that had not behaved according to its design. In reality, the hardfork was a breach of social trust that damaged the credibility of the Ethereum's decentralized nature. For ETH to be money, this is unnaccetpable. Hopefully, history will view it as a one time event that is forgivable due to the network's nascency.

The Ethereum community also tends to have an unbridled optimism and confidence around fixing problems through engineering. This can be energizing, but it can also border on dangerous naiveté. The push towards Proof-of-Stake, for example, strikes me as more risky than the community admits.

Finally, while Computerians may always remain multicoiners at heart, they should probably recognize that at some point, consolidation to a small handful of networks is not only inevitable, it's desirable. We almost certainly don't need a token for every decentralized app under the sun.

For their part, I think Fiscalites could stand to learn a few things from Computerians as well.

For one, Fiscalites are painfully narrow-minded when it comes to anything other than sound money. In fact, this narrow-mindedness can turn to actual hostility towards those who suggest other use cases for decentralized networks. This is foolhardy, as these other use cases do not preclude cryptocurrency being used as sound money in any way.

Smart contracts are the most obvious example. Fiscalites downplay their importance or outright write them off, as Jimmy Song does in the piece linked below. But an army of tinkerers and builders are flocking to these platforms to see what they can create with the new capabilities they've been granted. Underestimate them at your own risk, but perhaps do a bit of research on the history of personal computers, open source, or the web before you do.


Finally, Fiscalites ought to at least consider the idea that multiple crypto-networks can coexist. Perhaps they'll be proven right in the long run and Bitcoin will dominate. Even if so, pretending to know right now, with certainty, that Bitcoin is the only coin that can possibly prosper is beyond presumptuous, it's preposterous. The world is simply too complex.

Can't We All Just Get Along?

If these two vantage points are to be reconciled, we must find common ground. The essential point of contact between the two ways of thinking is decentralization. Both sides deeply value the potential for crypto-networks to disintermediate entrenched central powers.

Fiscalites are focused on state-backed central banks who tinker with the economy through top down monetary policy. Computerians are concerned by the giant internet aggregators who increasingly control the web, wielding broad power to promote or censor what is seen. Both are rightly uneasy about deepening concentrations of power in the modern world. Both recognize the immense promise and importance of dispersing it.

This vision of a bottom-up, decentralized world, enabled by crypto-networks, is one worth fighting for. Hopefully, those who share it can be persuaded-- despite their distinct perspectives-- to work together to see it realized.

Note: Build Blockchain Tech may not hold rights to the images used in this post. In such cases, images are reproduced here under the doctrine of fair use.

What If We're Wrong? Steelmanning The Case Against Crypto

Augur, the decentralized prediction market built on Ethereum, has been running for two weeks. Since then, the money at stake in the system has grown to $1.5 M, making it one of the highest profile DApp launches to date. In many ways, it is demonstrating the potential decentralized platforms hold. That potential, it turns out, is both good and bad.

A steelman argument is the opposite of a strawman: one makes the best argument possible for the opposing view

A steelman argument is the opposite of a strawman: one makes the best argument possible for the opposing view


A Market For Murder

Already, so-called "assassination markets" have begun to crop up on Augur. By allowing betting on whether a public figure will die in a given time period, an incentive to murder is created. Hopefully we can agree we don't want that. What's less clear is what we can do about it. Augur is decentralized. Its creators recently disabled their escape hatch, i.e. their kill switch. Even if they had shut it down, someone would surely have launch a version that can't be turned off. So what now?


There are a lot of arguments against crypto-- doubts about scaling, misunderstandings around energy use, uninformed claims that it's value-less because it's "not real." These arguments are weak and fall apart under scrutiny.

The situation with Augur cuts to the heart of the one thought that truly makes me doubt my enthusiasm about this technology: what if we're wrong about the benefits of decentralization itself? What if centralized authority is actually critical for civil society, and we're in the process of destroying it?

Déjà Vu All Over Again, Again

I've written before how much the crypto community could learn from the lessons of the internet itself. This case is no different.

It's hard to remember now in 2018, but there was a time when many had a near-utopian view of the internet's impact on the world. By connecting all of humanity with a decentralized network, we would end our divisions and enrich each other's lives. Once we could talk with each other across the globe, we would recognize our shared humanity and erase our cultural differences. The end state would be a unified humankind. So the story went.

Our AOL personas once ran Eagerly into the arms of a happy online family. These were simpler times.

Our AOL personas once ran Eagerly into the arms of a happy online family. These were simpler times.


The reality, which we've only really started to grasp in the last few years, has been close to the opposite. When we can read and watch whatever we want, we choose the content that confirms our biases. When we can talk to whomever we want, we find exactly the community of people we most agree with. Rather than uniting us, the democratization of content and communication has balkanized us. We've opted into our own filter bubbles, and once there, radicalized ourselves in a flurry of self-indulgent groupthink.

The result is the degradation of our politics, the polarization of virtually all discourse, and the rise of ideas that were, even very recently, far on the fringe. Scott Alexander put it succinctly in a recent piece on his blog:

 If you spend decades inventing a powerful decentralized network to allow unpopular voices to be heard, sometimes you end up with unpopular voices being heard

If it's true that the decentralizing force of the internet has pushed public discourse to the brink of collapse, then what havoc might yet be wrought by crypto? We're inventing powerful, un-censorable, decentralized networks to allow anyone to transact with anyone anonymously. Should we act surprised when unsavory transactions occur? Murder markets, and a hundred other nauseating trades, may be here to stay. Can society function if they are?

Whither Kryptonite?

This is the fear that keeps me up at night-- that make me question my involvement in this crazy space. This is the steelman to my optimism around crypto. Yet here I am, still learning and building. Why? Because the alternative is unacceptable.

The risk of steelmanning your opponents argument-- you might convince yourself!

The risk of steelmanning your opponents argument-- you might convince yourself!


If centralized authority is required for civilization to function, it implies that people cannot be trusted with their own free will. It means that there must always exist some superior elite-- granted the unilateral power of censorship and violence-- tasked with putting guard rails around the otherwise-destructive tendencies of the unwashed masses.

Given that people with power have committed the worst atrocities in history, this seems unlikely. If we must rely on some supermen to protect us from ourselves, then perhaps we are truly doomed. I don't believe we are, and net everything, I believe both the internet and crypto will be good for the world.

Still, we should not charge forward with blinders on, pretending there are no downsides to the technology we're creating. Without a doubt, it will be used nefariously by some. It already is. More than that, it has the potential to disrupt much of the status quo. In the process, it will create as great a tumult for society as the internet itself has-- or worse. As technologists on the bleeding edge of this new world, we should be wary of these risks. Let us wield our privileged position responsibly.

Note: Build Blockchain Tech does not hold copyrights to the images used in this post. They are reproduced here under the doctrine of fair use.

Do We Need A Blockchain To Be Decentralized? A Conversation With Alex Hillman.

Alex Hillman is the co-founder of IndyHall-- one of the earliest, longest running, and most respected coworking communities in the world. He's also an entrepreneur, developer, speaker, prolific writer, podcast host, and all around expert in building community. Despite having his reservations around blockchain and cryptocurrencies, Alex is a self-described fan of decentralization.

Which begs the question: do we need a blockchain to be decentralized? What does decentralization really mean anyway- and why is it important? In this webinar, Alex and I discussed exactly these questions. This was a great conversation-- Alex brought up some key questions and I enjoyed our discourse on these issues.

For more from Alex, follow him on Twitter @alexhillman and visit dangerouslyawesome.com.

Apple has the Incentives, Values, & Tech to Bring Blockchain Mainstream

Here's a thought experiment: imagine Apple buying Brave, the privacy-focused browser company that uses a cryptocurrency to compensate content creators.

Apple could integrate the Basic Attention Token (BAT) into Safari and give every user with an iCloud subscription a few tokens a month to be distributed to the sites they browse. The iPhone's secure element could store your wallet's private key such that not even Apple could access your tokens.

Apple could market the tech as ushering in a new age of sustainable journalism and content creation, one aligned with user privacy and with democratic values. The move would also be a blow to some of their biggest competitors. As a nice cherry on top, the acquisition itself would likely cost nothing; the value of BAT tokens held by Brave would skyrocket with the deal's announcement.

This isn't a prediction, it's just a thought experiment. The point is that the story at least sounds plausible. You could imagine it happening, even while acknowledging it's very unlikely it will.

Now imagine Google buying Brave. Would they integrate it into Chrome? Of course not! Doing so would kill their ridiculously lucrative ad network. Would they let you control your keys? Of course not! To Google, all computing belongs in the cloud (i.e. on their servers) and a Google account should mediate your identity on the web. Google is completely misaligned with Brave's ethos.

Privacy as a Strategy Credit

Of all the major tech companies, Apple seems to take user privacy the most seriously. This was on display at their World Wide Developer's Conference last week. They announced, for example, that Safari will get numerous features aimed at thwarting efforts to track you across the web.

Apple markets these changes as great for users, without compromising their business, and weakens their competitors at the same time. Apple, after all, just wants to sell you more devices. Personal data, while the lifeblood of companies like Google and Facebook, isn't particularly valuable to them. Several years back, Ben Thompson coined the term "Strategy Credit" to describe the situation.

It would be overly cynical, though, to say Apple only adds these features because of financial incentives. I believe Apple, and Tim Cook, truly do value users' privacy. It was Apple, after all, that went toe-to-toe with the FBI rather than backdoor a terroist's phone. Just today, it was announced that Apple would close another security hole used by law enforcement to crack iPhones.

That Apple's values surrounding privacy also square with Apple's business model should be seen as a powerful alignment, one that could drive real change in the industry given the company's incredible leverage.

Towards A Decentralized Future

This, then, is the most compelling reason to believe Apple could be the first major tech company to embrace blockchain technology: they are best aligned with the vision of a decentralized future it promises.

Google and Facebook, on the other hand, are completely misaligned. The very premise of each business is to provide centralized services. A decentralized future, one that gave even minimal control back to users, could weaken or destroy them.

It's not at all surprising that Apple has yet to wade into the Wild West that is crypto. They rarely adopt bleeding edge technology. Still, Apple's values, incentives, and tech stack align well with a decentralized future. Historically, they have a knack for knowing when an emerging tech is on the cusp of adoptability. If and when Apple makes a move to embrace blockchain technology, pay attention!

What the Crypto Community Should Learn From GitHub's Acquisition

On Monday, Microsoft announced that it had acquired code-collaboration site GitHub. Initial reactions have been mixed. More than a few have pointed out that Microsoft has embraced open source as of late, seemingly sincerely. Many of us, though, can't help but feel uneasy seeing the Redmond behemoth, whose then-CEO once literally called Linux cancer, now in control of the hub of all open source software.

What happened here, anyway? Given that git is an open source protocol for decentralized version control, how did we end up re-centralized around a Bay Area startup- one which, in retrospect, was almost certainly destined to end up inside one of the tech giants? Let's examine this more closely. There is an important lesson for the cryptocurrency/blockchain community to learn.


New Powers, New Problems

Git was created by Linus Torvalds to help manage the development for the Linux kernel. Existing version control systems relied on a centralized, client-server style architecture. Your repository lived on a server, controlled by an admin, while you, the lowly developer, merely ran a client to interact with it. Git flipped this on it's head, as Linus himself explained:

...having a local copy of the repository and distributed merging was a big deal. The big thing about distributed source control is that it makes one of the main issues with SCM’s go away – the politics around “who can make changes.” ... you can avoid that by just giving everybody their own source repository.


In stark contrast to existing systems, git made branching, merging, and forking painless. Anyone could grab a copy of a repo from anyone else, create a branch, commit modifications to the code, and provide those changes to anyone else for easy merger. Previously, the centralized repo had been the choke point of a given project. That choke point was gone.

With this new set of powers, we saw a Cambrian explosion of open source that coincided with git's adoption. But with so many developers now able to hack on so many projects, new problems also arose. Discoverability, collaboration, communication, bug tracking- all of these became challenges. That's where GitHub stepped in, providing elegant, centralized solutions around all of these new problems.

The introduction of a distributed, decentralized, peer-to-peer protocol for source control removed one set of choke points. But it also created a new set of problems, and we ended up re-centralized around a single tool- one that literally has hub in the name, in case you missed exactly what was happening.

Déjà Vu All Over Again

This turn of events shouldn't surprise us that much. In fact, we've already seen it, and on a much grander scale. This is almost exactly the story of the Internet.

Where previously, the dissemination of content was controlled by a small number of entities who managed distribution (publishers, broadcasters, etc..), the internet introduced a distributed, decentralized, peer-to-peer protocol that removed those choke points. And it also created new problems. With virtually infinite content to consume and people you can communicate with, how do you find what and who you're looking for? Enter Google and Facebook, the centralized colossi that solved these problems, and in doing so became the new choke points.

Twice now, (and there are many more examples), we find the introduction of a decentralized protocol demolishing old choke points but also creating a new set of problems, and thus leading users to re-centralize around the companies that solved those new problems. Could there be any application of this idea to the world of cryptocurrencies? 🤔

This Time, It's Different?

Many of us believe we're in the early days of introducing decentralized protocols for money, identity, ownership, and possibly many other things. In so doing, we'll remove a whole host of existing choke points. But what are the new problems that will arise if we do? And could the solutions to these problems lead to re-centralization: a new set of choke points? There are already some early, obvious examples of problems that are being solved in centralized ways: on/off ramps to fiat, interfacing with regulatory bodies, production of mining hardware, and key custody are just a few examples. Many other less obvious issues are likely to arise over time.

A large part of the crypto/blockchain community is excited about the potential for these technologies to diffuse power from central authorities. Me too! But I can't help but wonder if, in our glee to see things decentralized, we're missing a valuable lesson from history. Much of the focus now is on the disintermediation of middlemen sitting at existing choke points. Perhaps we should be much more attentive to, and concerned about, the rise of the new ones.

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