I’ve been thinking a lot of late about what “libre” and “open” mean to me, in large part by thinking about movements adjacent to open source software, and how open software might learn/borrow from its progeny. I hope to go into that more this summer, but in the meantime, I’m publishing this as a related “just blog it and get it out” note.
This post started as an email to a private list, giving my best-case argument for why open lawyers should pay attention to crypto/blockchain/web3 even if it’s apparent that most of these things are at best naive and at worst planet-destroying scams. I think it’s worth sharing in public to get more comments and more thoughts on this attempt to steel man the argument for cryptolaw.
So, why should open-adjacent lawyers take crypto seriously?
The Bad Bits
Liability
I’ll start with a point designed to appeal to the most diehard crypto-haters (and to be clear, that’s mostly me too!) Quite simply, crypto (particularly but not just smart contracts) is an almost ideal test case for anyone who wants to bring product liability into software. For decades now, we’ve argued (essentially) that software is too complicated, and so software developers should not be liable when it breaks. And in any case, how do you figure out who owes what to whom when it breaks?
In crypto, those arguments start to look particularly weak. The code is much simpler, and the damages are very specific and clear: “my money(-like-thing) disappeared!” And of course this breakage happens all the time; I haven’t looked but I assume there’s an entire category on Web 3 Is Going Great devoted just to software bugs.
Given all this, lawyers will be tempted to bring product liability cases, and judges will be tempted to resolve them. If that happens, and it finally brings serious product liability to software, what does that mean for our FAVORITE BLOCKS OF ALL-CAPS TEXT? To put it another way: the worse you think blockchain is, probably the more worried you should be about the impact of blockchain on every free software license.
(For this point, I am indebted to Mark Radcliffe, who has been writing and speaking on this issue for a while.)
Ethics, or lack thereof
To continue again with the “the more you hate crypto, the more you should pay attention” theme: lots of developers also hate crypto! In the past year I have been repeatedly asked about anti-crypto riders to attach to open source licenses. This would of course make them non-OSI-approved, but lots of developers hate crypto even more than they like (or are aware of) OSI. I suspect that if ethics-focused licenses ever really take off, anti-crypto energy may be the main driver. How those licenses are defined will make a difference, possibly in clauses that live well-past the current crazy.
The Better(?) Bits
Creates lots of code
To turn towards the more positive side: crypto is one of the most dynamic nearly-completely-FOSS sectors out there; it’d be weird for the open community more broadly to ignore them as FOSS consumers and producers. They write a lot of FOSS-licensed code!
As a practical matter, even if you think tokens/blockchain are likely to fail in the long run, it is likely that some of this code will leak back into non-token applications, so its licensing (and related: licensing hygiene) matters.
Governance innovation
Open source communities have traditionally had at least some members interested in how to govern online communities. Many of us who have been around long enough will have participated in more than one discussion of which version of Ranked Choice Voting to use 😭
Crypto is innovating furiously in the online governance space. As with all “innovation” most of that will turn out to be pointless or actively bad. But as a few practical examples of how it is filtering back into open source:
- questioning Delaware as a default incorporation location for open-adjacent non-profits, particularly in favor of Switzerland
- DAO-like proposals for the “exit to community” of Open Collective
- Governance putatively optimized for financial sustainability
Again, most of that is somewhere between naivete and scam, but not all of it. Open lawyers (and open leaders more generally) should be aware of these ideas and have responses for them.
Taking ‘freedom’ seriously, sometimes
Related to the previous point, as the Cryptographic Autonomy License process reminded us, at least some crypto communities are taking the principles of free software very seriously and extending them to critical future issues like data governance and privacy. If open source wants to move the ball forward on these values and methodologies, the action is by and large in crypto (even if finding the good-faith action is a little bit like finding a needle in a haystack of greed and scams).
‘Smart’ contracts as new legal form?
Smart contracts are mostly garbage (because they are software and most software is garbage) but the interface of this new legal form with existing institutions is both (1) intellectually interesting and (2) has a lot of parallels to early adoption of open licensing as a legal form/tool. I’d love to interview the author of this paper on smart-contracts-as-vending-machines, for example. Similarly, I suspect there is something to be learned from efforts to bring arbitration to the smart contract space.
Money and interest
Finally, there is, quite simply, a pile of crypto-derived money and therefore employment out there. I personally find taking that money pretty distasteful, but lots of friends are taking it in good faith. Every open and open-adjacent lawyer will be getting questions (and many of will be getting paid for their time) out of that pile of money in coming months and years.
Whether we like it or not, this money — and the people paid by it — will set agendas and influence directions. We need to take it seriously even if we dislike it.
Closing (re-)disclaimer
Again: lots of cryptocurrency/web3 is malicious, and the primary legal response to carbon-emitting proof-of-work should be to figure out how to lock people up for it.
But there are, I suspect, a growing number of overlaps between what “we” do in “open” and what “they” are doing “there”. If we want to be seriously forward-looking, we need to take it seriously even if we hate it.
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