Vitalik acknowledges that he and Balaji have different perspectives on the libertarianism of network state theory.

Vitalik Buterin Ethereum Founder is thinking about Network States built for Blockchain

The Network State, a book by bitcoin investor Balaji Srinivasan, was published on July 10. It focuses on developing startup societies that are based in the cloud, employ a built-in cryptocurrency, and crowdfund real territory.

Ethereum creator Vitalik Buterin wrote about the book in a blog post on July 12.

Even while Vitalik disagrees with Balaji on a few issues, he clearly supports testing out different network conditions. Network states "may be understood as attempts to sketch out a wider political narrative for crypto," the author says. Network states present an opportunity to create entire communities and ecosystems around the blockchain, preventing cryptocurrency from becoming merely a hangout for nefarious traders and crypto bros.

Although the concept of network states sounds like it belongs in a Aldous Huxley story, several network states have been started during the bull run. After establishing itself in July 2021, CityDAO acquired a 40-acre Wyoming property for an undisclosed cost, and Praxis raised $15M to finance its technologically advanced metropolis.

Vitalik has previously stated that he would want to see fewer monkey jpegs and more public goods in cryptocurrency. One solution might be network states. Vitalik uses CityDAO as an example and provides a few instances of possible network states, some of which are more plausible than others.

Want to live somewhere where everything is fitness-friendly? Purchase land, start an online Fitness community, and then start one offline. Looking to live in a nation that exclusively accepts cryptocurrency or one that permits Monster Trucks? The game plan is unchanged. According to this description, "someone of nearly any political viewpoint could identify some type of network state that they could get behind," wrote Vitalik.

So what is a Network State in reality?
A network state is a social network that possesses moral innovation, a sense of national consciousness, a capacity for collective action, a level of civility that is acceptable in person, an integrated cryptocurrency, a consensual government that is constrained by a social smart contract, an archipelago of crowdfunded physical territories, a virtual capital, and an on-chain census that demonstrates a sizable enough population, income, and real-estate footprint to achieve some level of diplomatic status.

Vitalik acknowledges that he and Balaji have different perspectives on the libertarianism of network state theory. While Balaji leans more to the right and thinks the solution lies in forging new, self-sustaining, more homogeneous communities, Vitalik claims that he is used to a socialist idea of promoting equality through regulation.

DeFi and Decentralization of everything
Vitalik advises introducing more democracy and extensive collaboration to establish a medium ground. While it is normal for founders to be influential figures in network states at first, according to Vitalik, there should be a gradual transfer of power to the general populace. According to him, additional community members' input is automatically taken into consideration as the network state advances in maturity and scope.

Vitalik contends that traditional democratic voting may be more appropriate than coin-based governance in order to further decentralize authority.

By tweeting, "my fast response is that the network state idea is flexible enough to handle these recommended adjustments," Balaji responded positively to Vitalik's suggestions. It is far more of a toolset than a manifesto.

Balaji and Vitalik concur that network states will go through a great number of trials and iterations in search of the ideal system.

Written By

Petrache Ionut

Jul 28, 2022