We all realize that blockchain and cryptocurrency is in the process of disrupting a great many things. There are a lot of industries coming under attack from alternatives that are cheaper, faster, and more efficient.
In addition to industry, governments are having to adapt to entirely new business models. As we know, this is a slow process since most governments are trying to utilize regulations from the old model and force them into this new paradigm.
It obviously is not working.
There are, however, a few governments that are experimenting with new ideas. These are the ones that are forging new paths, which could lead to a great deal of success in their areas.
Nevada is currently one government, led by the innovative Governor, that is attempting to establish some new concepts.
Steve Sisolak has drafted a bill that will allow technology companies, in the State of Nevada, to essentially become their own governments. This includes cryptocurrency firms.
The bill carries that idea that companies which own a lot of land would be able to operate similar to a country government. They would be able to impose taxation, form school districts, and provide services normal to local governments.
This would be done through opportunity zones, a model that has been used to try and stimulate economic development, often in rundown areas.
The Review-Journal, citing a draft of the legislation that has not yet been sent to the Nevada Legislature, said the proposal would require companies to own 50,000 undeveloped acres of land outside a town. They’d also need $250 million in the bank and to dedicate $1 billion in spending across 10 years.
This is an interesting proposition which obviously does not focus exclusively on blockchain firms. According to the above linked article, the target will also be AI and Robotic firms.
It is opening up an entirely new concept. As it pertains to cryptocurrency, this is very interesting in that it provides a geographic area whereby a currency could be the main use for transactions. Obviously, if a firm met the requirements, they would be free to utilize whatever currency they desired. A firm would likely start their own, which would help to foster even greater adoption.
At the same time, it also brings up the question of DAOs. A company is really nothing more than a legal entity, created through the filing process. Thus, it does not exist but "on paper". However, that is given a great deal of power as we know.
Today, companies are run by people. They are headed up by a Board of Directors along with officers. In small firms, they all might be one but they expand as the firms get larger.
Automation is changing the landscape of our world. The introduction of blockchain based smart contracts enable a firm to exist completely without humans. As they say, "code is law".
If the Governor's proposal is passed, what will this mean for technology firms that exist without people. It would then be possible to essentially set up an autonomous government with each community member owning some stake. There would be humans involved in the process of coding, voting, and other activities but the basis of the "government" would be code.
This is a path that blockchains with foundations could pursue. To start, the foundation would operate as the "company". However, over time, once established, the entity could be converted as the code is expanded to take greater control of the government. Couple this with automation and robotics and we could see a "city government" that is mostly autonomous.
For example, the Ethereum Foundation is sitting on top of a lot of ETH. This has enough value to meet the requirements of the bill. If it decided to become a Nevada "government" by buying the necessary amount of land, it could establish an entire physical community that is tied to what is being developed in the digital world.
Of course, there is a risk in all this. If we are talking about companies like Google, Apple, and Facebook, we could see them getting even greater power. One defense, at least in theory, is they do have to answer to the government on certain matters. This would be gone with the new proposal.
That said, one is not forced to live in said area. Since this would be private land purchased, it would be up to those who are involved with those companies to decide whether they want to be a part of that system. Obviously, those who are not for Facebook might not opt to move there.
Nevertheless, it would be of benefit for blockchain based entities to get involved. Those that are decentralized in nature could be established in such a way as to meet the requirements. Over time, the decentralization process could spread once everything is established.
This could be the beginning of a new form of physical governance. At some point we are going to see the merging of the physical with the digital. How that looks remains to be seen. Here is one idea that starts with the company as opposed to trying to change government.
We will have to see if this bill passes. Nevertheless, it will trigger a lot of conversation.
What are your thoughts? Let us know in the comment section below.
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