Blockchain Governance: What We Can Learn From the Economics of Corporate Governance
16 Pages Posted: 7 Feb 2020
Date Written: January 15, 2020
Understanding the considerations and complexities of blockchain governance is urgent. The aim of this paper is to draw on institutional governance theory — including corporate governance — to provide insights into the core considerations in designing blockchain governance mechanisms. We define blockchain governance are the processes by which stakeholders (those who are affected by and can affect the network) exercise bargaining power over the network. The main considerations include how we define stakeholders in blockchain governance, how the consensus mechanism itself distributes endogenous bargaining power between those stakeholders, the role of exogenous governance mechanisms and institutional frameworks, and the needs for bootstrapping. While we can learn from corporate and internet governance, blockchain governance should be understood as being an institutionally distinct organisational form with distinct governance systems.
Keywords: Blockchain Governance, Institutional Cryptoeconomics, Economics of Blockchain, Corporate Governance
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