Guest Post

From Startup Society to Network State

By  |  August 1, 2022

Can a new country be founded? Not on physical land — at least not at its founding. Not by a referendum. Not by revolution or war. Not by planting a flag on a piece of territory. Not aboard a cruise ship floating in international waters. And not in space. Or on Mars.

But founded online — digitally. Formed first in the cloud — as a peculiar and purposeful “internet phenomenon”. Then lastly, as an interconnected but non-contiguous series of “enclaves” linked together by shared values, a common vision, and a declared objective.

Can such a country, can such a nation be founded? Today? In the 21st century? Emphatically, yes, says crypto-philosopher Balaji Srinivasan in his new book The Network State, published on July 4, 2022, as an e-book on Kindle. Balaji argues that a “Network State” can indeed be founded by a visionary founder, who learns from history, conceives of a founding purpose, and applies the technology tools of web3 and blockchain and metaverse to found such a network state — first as a “Startup Society” that matures into a “Network Union” and then finally into a Network State.

In Balaji’s supremely fascinating definition: “A network state is a social network with a moral innovation, a sense of national consciousness, a recognized founder, a capacity for collective action, an in-person level of civility, an integrated cryptocurrency, an archipelago of crowdfunded physical territories, a virtual capital, and on the on-chain census that proves a large enough population, income, and real-estate footprint to attain a measure of diplomatic recognition.” Balaji then disaggregates these elements of a network state to build a trajectory of the founding and maturing of such a network state.

First, the founder forms an online community — a startup society — around a set of shared values and common purposes, a startup society into which people who identify with those values and purposes can opt. Second, this startup society is organized into a “network union”, — which organizes its membership into collective action around shared values and common purpose.

Third, the founder creates or fosters a community space offline where members can build trust among themselves — while he or she simultaneously builds a crypto-economy online — “ … an internal economy using cryptocurrency.” Fourth, with an adequate accumulation of trust and monies, the network union can “crowdfund” physical territories, which may be apartments, houses, cul-de-sacs, and even cities, to then enable the “netizens” of the network union to connect with the physical world via non-contiguous and global physical spaces. “The citizenry first assembles in the cloud and only then crowdfunds the earth,” Balaji asserts.

Fifth, Balaji explains, these physical spaces would be linked into “… a network archipelago, a set of digitally connected physical territories distributed around the world.” Web3-enabled “crypto passports” would be issued to the netizens of the network union. Sixth, real-time census — not every ten years! — can be conducted online to demonstrate the size of the population, income, and real estate controlled by the netizens of the network union.

Seventh, and finally, the startup society-turned-network union would seek diplomatic recognition from legacy states — at least from one legacy state initially and then from other legacy states until it becomes itself a “true network state.” Thus, a network state would be “ideologically aligned but geographically decentralized.” And would ultimately be recognized by the United Nations as having sovereignty of a particular kind.

Balaji argues that “The network state formation process can begin with a single founding influencer and scale to a million-person physical community” — and he outlines how this exponential growth can occur. As many more people become aware of the values and purposes of a network state (or its progenitors of a network union or network archipelago), they will apply to become “netizens” — “subscriber-citizens”, in Balaji’s terminology. “Because a network state is fundamentally a proposition nation, it’s constantly evangelizing its beliefs” – asserts Balaji — thus attracting new netizens’ immigration digitally to its network state. “Missionary” societies have more longevity than “mercenary” societies, as Balaji convincingly argues from history. The pull of the heart and soul has more torque and horsepower than the lure of money. “Dignity is also as important as bread,” as the novelist  Chimamanda Ngozi Adichie powerfully stated in her May 2022 Yale Law School commencement address.

As the population of the network state grows, so does it increase its income and investments and grow its “physical footprints.” Meanwhile, the network state will keep innovating digitally, such as non-fungible tokens (NFTs) and the like. Balaji posits that “a network state is about accelerating innovation in the physical world.”

It’s clear that the network state envisioned by Balaji can only have been envisioned in this Information Age, where the tools and platforms of the internet and other digital communications technologies make that envisioning possible. Blockchain technology in the form of cryptocurrency enables the envisioning of a secure and verifiable digital mechanism for issuing digital passports, a network state e-currency, and NFTs — as well as a mechanism for establishing efficient and effective cross-border connections and conducting real-time population counts.

This author appreciates Balaji’s delineation of the elements of a network state, in which he emphasizes that a sense of history would inform “a moral innovation” that drives a “national consciousness.” Knowing what has historically gone wrong or what is persistently not working — aiming to transcend the identified challenges and reframe the paradigm of what is possible — a network state founder infuses his or her online community with “a capacity for collective action” geared towards a common purpose and in line with shared values.

This author appreciates, too, Balaji’s emphasis on “an in-person level of civility” in the digital discourse to ensure that interactions within the network state are devoid of (distracting) bile and venom. Indeed, he asserts that the “digital governance” architecture of a network state would lay down strict rules of membership — and provide guidelines and processes for requiring non-civil netizens to exit the online community, startup society, or network state. You join based on the values of the network state — and involuntarily exit, again based on the same values.
The Network State may be seen as two books in one. The first book, and the most important, relevant, and interesting to this author, is the book that contains the supremely innovative network-state ideas of Balaji outlined above. The second book is the one that deals with ideological issues — or what Vitalik Buterin refers to as Balaji’s “megapolitics” — that this author does not necessarily agree with or find intrinsic to the core of the innovative network-state ideas outlined above from The Network State. In his review titled “What do I think about network states?”, Vitalik Buterin, technology entrepreneur and co-founder of Ethereum, first made this point of their being two books in one in The Network State.

The concept of a network state enunciated by Balaji is, perhaps, informed by libertarian impulses, but as even he explicitly acknowledges, it certainly has progressive (and direct-democracy) implications. Indeed, a network state provides digital space to “test and scale” the application of human-development-engendering social, political, and economic ideas. In addition, the trajectory of a network state need not necessarily, in this author’s view, proceed in the ostensibly linear fashion delineated by Balaji. Hybrids, non-linear approaches, loops, pivots, and further and composite ideations inspired by the original idea are possible, desirable, and practicable. Knowledge, innovation, imagination; yes, all of it is cumulative.

Ultimately, is the idea of a network state laid out by Balaji in The Network State too fanciful, futuristic, and impracticable? Can an online community be transformed into a startup society, and then into a network union, and after that into a network state, and organized around shared values and common purposes? Can such online community be assembled and impelled to action based on a shared vision of “a moral innovation, a sense of national consciousness … a capacity for collective action … an integrated cryptocurrency, an archipelago of crowdfunded physical territories …”? Can it … actually? This decentralized autonomous organization — DAO?

Many people of African descent — both Africans in Africa and the global African diaspora — are energized by the ideas of a Network State as outlined by Balaji — and have directed those ideas toward building an African Network State focused on moving Africa and its diaspora from scarcity to abundance. Towards building and advancing a new narrative of empowerment and accelerating innovation and unleashment of the tremendous potentials of billions of people in Africa and its diaspora.

Echeme Emole (full disclosure, a close relative), technology entrepreneur and co-founder of the Afropolitan Network State, was inspired by Balaji’s (previously articulated) concept of a network-state to co-found the Afropolitan online community/startup society/network union and launch it towards its journey to a digital nation/network state — a digital nation for Africa and its diaspora along with its allies — and aimed at the creation of the first (albeit digital) nation created by Africans for Africans and of Africans and its diaspora: “Digital Africanism”, to borrow the naming convention of Balaji’s — an “African Proposition Nation.” (African — Westphalia-type — nation-states, as everyone knows, were created by European states at the Berlin Conference of 1884-1885 that launched the “scramble for Africa” by the colonial powers.)

As stated in the manifesto of the Afropolitan Digital Nation, with a focus on Africa and its diaspora, “… we propose the Network of Abundance: Abundance of Tools, Abundance of Opportunity, Abundance of Joy.” This, in Balaji’s phrase, would be the galvanizing “One Commandment.” A new “S-a-a-s”, as Balaji terms it — a “Society-as-a-Service”, now for Africa and its diaspora, and at once transcending the artificial state boundaries in Africa drawn by the European states at the 19th century Berlin Conference as well as the associated historical constraints. The long-held vision of “Pan-Africanism” propounded by long-gone political visionaries is finally coming to fruition in Digital Africanism.
The challenges of public governance in Africa are well known, and the challenges of overcoming them are well chronicled. But just as Africa leap-frogged the inadequate infrastructure of telephone land lines and achieved massive penetration of mobile telephones to capture tremendous economic gains: Africa is poised to leapfrog the challenges of public governance by reframing the paradigms of possibilities to leapfrog into a digital nation (serving its 1.2 billion people on the continent and the 150 million members of its diaspora). Poised to leapfrog into an African Network State that builds a new narrative and delivers massive socio-economic upliftment to its people. A “replacement narrative,” in Balaji’s phrase — changing the place, story, and impact of Africa and its diaspora. All of this was inspired by the crypto-philosophical ideas of Balaji Srinivasan contained in The Network State. A network state is an idea whose time has come — and Africa is crystallizing the idea to its enormous social, economic, political, and cultural benefit.

About the author: Chijioke Emole is an international energy law specialist and writer.

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