The Theory of Granularity: A Path for Antitrust in Blockchain Ecosystems

50 Pages Posted: 29 Jan 2020

See all articles by Thibault Schrepel

Thibault Schrepel

Stanford University's Codex Center; Utrecht University School of Law; University Paris 1 Panthéon-Sorbonne; Sciences Po

Date Written: January 14, 2020


Modern antitrust and competition law relies extensively on the firm as defined by Ronald Coase: a hierarchy reducing transaction costs thanks to vertical control, where such control defines the firm’s boundaries. Meanwhile, the governance of public permissionless blockchains is horizontal. Transaction costs are minimized thanks to specific characteristics that are singular to these blockchains and do not depend on the verticality of relationships. The absence of vertical control to direct the resources holds antitrust and competition in check.

Against this background, the present article introduces the “theory of granularity,” which permits analysis of the roles played by each (group of) participant in the horizontal governance of public permissionless blockchains. On this basis, one may identify a “blockchain nucleus,” i.e., a set of participants collaborating to ensure and maximize the blockchain survival by “controlling” it all together. Antitrust and competition law becomes applicable again as the nucleus serves as the basis for the definition of the relevant market and market power, the assessment of practices’ legality, and liability assignment.

Keywords: Firm, Blockchain, Antitrust, Competition Law, Ronald Coase, Granularity, Theory of Granularity, Theory of the Firm, Decentralization

JEL Classification: K21, K2, K22, K23, K1, K29, D23, D21, D22, D29

Suggested Citation

Schrepel, Thibault, The Theory of Granularity: A Path for Antitrust in Blockchain Ecosystems (January 14, 2020). Available at SSRN: or

Thibault Schrepel (Contact Author)

Stanford University's Codex Center ( email )

559 Nathan Abbott Way
Stanford, CA 94305-8610
United States

Utrecht University School of Law ( email )

Janskerkhof 3
Utrecht, 3512 BK

University Paris 1 Panthéon-Sorbonne ( email )


Sciences Po ( email )

27 rue Saint-Guillaume
Paris Cedex 07, 75337

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