In the network status† a sizzling new book by Balaji Srinivasan, Coinbase’s former chief technology officer, asks a devious question: How do you bring a country into existence?
Provocatively released on July 4, the book presents Srinivasan’s advocacy for a new model of a digital state run and managed in the cloud. A network state, as he describes it, is basically a group of people who come together on the internet and decide that they are going to start a country. With a social network to connect them, a leader to unite them and a cryptocurrency to protect their assets, Srinivasan says a country can be born with laws, social services and all. A network state is a country that “anyone can launch from your computer, start building a following” – not unlike corporations, cryptocurrencies, or decentralized autonomous organizations (DAOs). In a world where billionaires can run companies larger than countries, Srinivasan wonders, can such a state gain recognition from the United Nations?
Like all utopian visions, this one is diagnostic—an answer to a growing list of “evil” social problems such as surveillance capitalism, economic stagnation, political polarization, and superpower conflict. Just when we need leaders to solve our problems, Balaji argues, they fail, and the reason isn’t just corruption or incompetence – the reason is technology. The national government is simply no longer able to meet our needs because the world it was designed for has changed.
For example, the internet has made place less important, making national borders seem increasingly arbitrary. And cryptocurrencies like bitcoin have proven that if enough people believe in the value of an idea, you can create something worth trillions of dollars. Software has made it so that a few engineers can outdo countries (think hacker groups and startups). And in the age of social networks, millions of anonymous people can fit into groups that act and coordinate together; just look at r/wallstreetbets and Gamestop.
“Few institutions that predated the internet will survive the internet,” Srinivasan said recently in a lecture describing the book. So the solution, he says, is to build an institute on it. Here’s how it would work: A person on Twitter decides to start a country, so they take the idea to their friends and start collecting recruits. They draft a vision statement and a list of values, and soon people start to join in and tell their friends. It starts as a social network.
By pooling their money and borrowing their skills, the community begins to develop social services and create its own mini-culture, with things like health care and insurance and passports and dope parties. With something like a hybrid of Twitter and Discord, they were able to connect, share ideas and vote (think up and down voting on your favorite legislation). And with a currency like bitcoin, they can control their own money supply and protect their money from intrusive governments. First they would buy small swaths of land, like a national Soho home, and eventually they would start migrating to elected cities — likely to sympathetic jurisdictions like Miami, which, Srinivasan says, will compete to acquire these brave new digital citizens.
For it to happen, no wars need to be fought and no laws need to be broken. With rockstar leaders to blaze their trail and negotiate on the international stage, these new states would slowly but surely gain rights and recognition, eventually breaking away from their homeland once and for all. If it works, Srinivasan writes, “it will eventually become a template… the modern version of Jefferson’s natural aristocracy.” First, there was Brexit; than other moves like Wexit; now, a few years later, there’s a new romantic vision of escape for techies – “Texit”?
When The Network State drops this week, it’s likely to spark some heated reactions. Some grumble about the right silicone valley figures like Peter Thiel and Curtis Yarvin, will call The Network State’s ideas fascist and tyrannical, and others, probably the libertarian right, will call it visionary and scientific. Srinivasan, you may hear from them, is a fortune teller – a truth teller. But below the attitude there will be a lingering question: is this really possible?
While the concept might bend our idea of nationality, the fact remains that many precursors already exist. Consider Dudeism, a religion based on a character from the 1998 Coen Brothers film, which has a reported population of 450,000 Dudeist priests. Or even, as Srinivasan points out, the State of Israel, which brought together a nation scattered around the world and organized around a common ideal. Many UN-recognized countries, Srinivasan says, have populations of about five to 10 million with economies much smaller than what an equivalent number of tech workers could produce. That a bunch of crypto bros could test their fate on an eccentric leader doesn’t seem so far-fetched. Moreover, the technology already exists.
And with more than 650,000 Twitter followers — an army of young, tech-savvy and politically gullible acolytes — Srinivasan might just be the man to do it. There’s an expression that occasionally circulates about him on Twitter: that “Balaji was right” is the most terrifying expression in the English language. Among the crypto wealthy and billionaire class, this book will be positioned as a pole star, levied in support of the long-running claim that technologists can run society better than the bureaucrats. And now, with this book, Srinivasan has given them the framework to prove it.
What doesn’t fit so neatly into Srinivasan’s view are small things like death and aging and illness. How is poverty dealt with in a network state? “The future,” he wrote in 2015, “is nationalists versus technologists. A full-blooded, jealous defender of borders, language and culture. Or an uprooted cosmopolitan with a laptop, focused on disruption.” It’s certainly romantic, but you might wonder: what about people who just want a stable job?
Of course, Srinivasan isn’t the first technologist to offer a tarot reading of our technology-mediated future. In 2019, theorist Aaron Bastani wrote another popular formulation, this one from the left, in which he explains how robots will make us all rich. His book Fully Automated Luxury Communism begins with the same general diagnosis: that we are entering the third industrial revolution, that we are at a historic moment in human history, that technology has rendered our systems obsolete. But his conclusion, as the title suggests, is that we need more centralization, not less. Let the robots do our job, the book argues, and let us enjoy the loot. Hunger, disease, energy crises, jobs – these will all be remnants of a scanty and sordid past that came before the Age of Plenty. The future is the nanny state, Bastani suggests — only better.
What these visions point to is a growing rift between the strange cohort of people who call themselves futurists. On the one hand, there are those who envision a world of centralization, characterized by super-blocks and massive redistribution of wealth. And on the other hand, there are those who argue that the world already mirrors the feudal systems of yesteryear. In this kind of view, like Balaji Srinivasan’s, fragmentation lurks and rugged individualism is the prime moral code. And this book, or better yet, this script, is just the first attempt at making it official.