Getting insights from experts in the blockchain space is essential, as many different use cases are to be found in different markets, and only a few make a real change. We reached out to one of the leading blockchain experts in the governance blockchain market: James Fennell Tempelhof, co-founder of Bitnation.
Bitnation is a blockchain-based “Governance 2.0” initiative with a collaborative platform for DIY governance, Bitnation calls this “Jurisdiction as a Service”. It offers a full range of services traditionally done by governments, like secure ID systems, blockchain dispute resolutions, marriages and divorces, land registries, education, insurance, security and more. BitNation hopes to accomplish all of this through a fully distributed platform.
About ten years ago Blockchain was born as a distributed database that maintains a continuously growing list of ordered records, called “blocks.” The first blockchain wave was called Bitcoin, a digital currency, with an actual market value of $100 billion dollars. The second blockchain wave was called Ethereum, where the underlying technology that operated bitcoin could be separated from the currency and used for all kinds of use cases. And Bitnation is one of those successful use cases.
James Fennell Tempelhof is a former British navy officer, who has worked in almost every country that had armed conflicts from 1984. After a career in the Royal Navy he volunteering in an orphanage in Honduras (for kids from the war in El Salvador). After 9 years ended up as the UK head of emergency operations for the largest US NGO, where he worked in Sudan, Egypt and Somalia for seven of those years. Now he is the COO of Bitnation and got married on the Blockchain almost one year ago with Susanne Tarkowski Tempelhof.
LABCITIES: Tell us more about your company and how the company entered the Blockchain market.
James: Bitnation was founded by my wife, Susanne Tarkowski Tempelhof, on July 14th 2014 to build the core infrastructure on which a global network society could be constructed. The central idea was to harness blockchain technology to deliver a market in which voluntary ‘opt-in’ nations compete for citizens by offering a wide choice of governance services to meet the diverse range of needs of all 7.2 billion of us.
Bitnation recognises that we all have different ideas and preferences for governance services which a ‘one-size-fits all’ solution can never capture, and that competition over control of who determines which governance services we get is the primary cause of wars and violence in our present ‘Governance 1.0’ society – the one we live in right now.
Susanne’s idea was to turn governance on its head, and give agency back to each one of us. That is why we call our software, Pangea, the internet of sovereignty.
Presently we are arbitrarily compelled to accept (usually by force) a governance regime based upon geography – where we are born or reside. If we are lucky we might be offered some voice in the choice of the one-size-fits all model in each of these territorial nations. But ultimately the ability to make sovereign decisions – to be agents of our own destiny – is denied us and instead conferred upon a majority government, or worse, an unrepresentative authority. There are less than 200 of these ruling bodies to make decisions for all of us, and depending upon the vagaries and skills of politicians, they could deliver anything from communism to fascism to theocracy and expect us all to comply, even if those policies are plainly against the interests of many of their citizens, and indeed in some instances result in their expulsion, or worse.
To rid us of violence and maximise our potential, the world we want is one where we can all choose which services we prefer from a panoply of voluntary nations in a global marketplace for our citizenship and governance services. Susanne’s idea pre-dates the decentralised tech revolution inspired by Satoshi and the blockchain, but it was her discovery of Bitcoin in 2010 that inspired the formation of Bitnation: the organisation which is turning these ideas into practical reality.
Since 2014 Bitnation has established the world’s first decentralised, borderless, voluntary nation, world citizenship ID, refugee ID, and marriage, birth and land title certificates notarised on the blockchain. Due to Bitnation’s forward thinking and advanced technology, the Government of Estonia partnered with us in 2015 to offer a public notary service to Estonia’s e-residents based on Bitnation’s blockchain solution. Since then we have been building Pangea, the decentralised jurisdiction on which millions of voluntary nations can be founded and compete for our citizenship by offering a vast range of governance services that meet our individual and collective needs.
LABCITIES: Can you explain more about what your blockchain product offers and how it works?
James: Pangea, our Jurisdiction-as-a-Service concept is unique and embraces the growing trend towards decentralised tech and governance. Bitnation’s Pangea software can be used to create voluntary nations and peer agreements as smart contracts on any blockchain, and under any governing code of law. More than 200 new Nations have already been registered by our community and many more will be established once our Pangea 0.3 MVP is released during our token sale later this fall. On Pangea citizens can also conduct peer arbitration if disputes arise. On our Alpha which we plan to release early next year, Citizens will also be able to access governance services in the form of DApps and bots.
Pangea Arbitration Tokens (PAT) can be earned and create positive incentives for building a reputation for good citizenship on Pangea. Pangea’s AI (Lucy) uses an innovative system to automatically distribute non-tradable, proof-of-reputation sub-tokens every time a contract is successfully completed or a dispute successfully resolved. Citizens who accumulate non-tradable reputation are rewarded with tradable PAT master tokens. Reputation is awarded to arbitrators and contract creators too based on other Citizens’ feedback to ensure that services and smart contracts (in essence digital laws) can be chosen by users based on quality.
Under the hood is a delay tolerant mesh-network with a smartphone chat frontend. The mesh can write smart contracts to any blockchain – beginning with Ethereum and in time offering a choice of which blockchain ledger citizens choose to record agreements. Pangea’s mesh is quantum-safe-encrypted, and uses Citizen ID’s which are pseudo-anonymous to improve resilience and protect privacy. Smart contracts are stored and reputation calculated off-chain using a distributed-web file storage system (IPFS). An ecosystem of DApps and Bots on the mesh can offer governance services either as part of a voluntary nation ‘package’ (to solve collective problems), or from independent providers targeting citizens of any nation to solve individual problems. We are currently working with community partners on opt-in basic income and voluntary taxation DApps, for integration in the next 18 months.
In summary, Pangea provides the easy-to-use, fully decentralised smartphone chat-based infrastructure on which voluntary nations can be built and populated, peer-to-peer agreement made and executed, and governance services accessed under any governing code of law. It is also an incentive network, on which our token PAT provides positive incentives for good citizenship and the evolution of laws based upon their performance in delivering desired outcomes for users.
LABCITIES: What problem does your blockchain solve compared to the actual market solution?
James: Well firstly we are not developing a blockchain per se, but rather our jurisdiction (a decentralised legal domain, if you will) is a mesh communications network which can write smart contracts to any blockchain from a smartphone. These smart contracts can be used to define the legal parameters of a voluntary nation (which anyone can join or leave at any time), or be used for peer-to-peer agreements and to access governance services from these nations or other local or pan-national service providers under any governing code of law, or none.
At the highest level our solution solves the perennial problem of inter- and intra-state violence. Where citizens are forced to compete with one another for a one-size-fits all governance solution, or nation state governments compete with one another for power over citizens and territory. In a Bitnation world anyone can create a new nation, by forking the Bitnation Decentralised, Borderless, Voluntary, Nation (DBVN) contract on Pangea, and offering real world services to potential citizens on Pangea as an incentive to join. Citizens no longer need compete with one another for the governance solution they desire, they simply choose one on Pangea (or make their own if the one they prefer does not exist), and nations no longer need use violence to compete with one another for power, they simply offer better services and citizens behave like customers and come to them for services.
By creating a competitive market for governance services we will also solve many of the inefficiencies and wasteful practices we experience by providing governance services through the nation state oligopoly, and make new and innovative services targeted to individual needs available across borders. At a more granular level, Pangea is highly disruptive of the legal services industry, and offers a simple and efficient way to make positively incentivised and robust peer-to-peer agreements under any governing legal code at a fraction of the cost of using legacy legal professionals and institutions. Because our reputation system rewards good citizenship we believe network effect will create system-wide incentives for compliance, and more people will uphold contracts and legal codes they themselves have selected with other parties to their agreements, and by which they are rewarded with reputation and resources in the form of PAT tokens in return for good faith.
Legal services is a US$6Bn per annum industry, and nearly half of the world’s population do not currently have access to legal protections as they are forced to work in the system D informal economy due to onerous national and local regulation and expensive and often corrupt legal and enforcement services. Pangea’s very low cost, quick and automated contracting system, positive incentives through the reputation system, and access to human arbitration, makes legal protection both desirable and robust for billions of unprotected citizens and much simpler and cheaper for those using current legal solutions.
LABCITIES: Which main organisations are using blockchain already in your sector?
James: There is no doubt in my mind that decentralised governance solutions will have the greatest positive impact of any of the new decentralised technologies on our lives in the long term. Currently there are two approaches to using decentralised tech to improve governance. The first – and by far the most prevalent – are those which want to use blockchain technologies to improve the existing centralised political decision making system by providing citizens with greater voice in Governance 1.0. Direct democracy and liquid democracy solutions are promoted by start-ups like MyVote and Democracy Earth are the most well known of these types of projects. I like to call these, somewhat tongue in cheek, ‘the better horse’ option. They will undoubtedly offer short to medium term incremental benefit in the quality of voice we have in nation states – in Governance 1.0, if you will – but in the medium to long term they will not deliver a Governance 2.0 decentralised governance solution that returns agency to us all and delivers the borderless world we desire.
The second approach, of which Bitnation is both the first and best developed, it to recognise that Satoshi invented the governance equivalent of the automobile, and it is this solution, one that provides each of us with agency rather than voice, that we are building. Decentralised tech enables us not only to improve Governance 1.0, but to build and inhabit a complete and better new world, Governance 2.0, in which we have much greater control over our lives, less coercion and in which there are much stronger incentives for prosperity and peace. In this sector we believe we are unique and at the leading edge of governance tech.
LABCITIES: What interesting other blockchain solutions did you find outside your sector?
James: Ethereum of course has been fundamental to Pangea – the ability to run applications on a blockchain provides the technology to enable the creation of viable voluntary nations and decentralised governance services. Aragon is also interesting as it attempts to do the same for corporate governance as Pangea does for political governance, by enabling the creation and management of decentralised autonomous organisations on their platform. We have forked some of their code to develop the latest iteration of our voluntary nation contract (DVBN). EOS, Tezos and Rootstock are all new blockchains which we are excited to see under development to provide competition to Ethereum, and we want to offer the best as choices for citizens on Pangea in due course. CrowdJury provides an interesting application for augmenting peer arbitration, and which we would also like to offer on Pangea, and we are also excited about b-Umbrella a new start-up which has potential to offer citizens physical protective security solutions in a decentralised world. Down the road Bitlattice is an exciting multidimensional ‘blockchain 2.0’ idea, which can resolve some of the monolithic nature and inefficiencies of current blockchains.
LABCITIES: In which sectors will blockchain become dominant?
James: Already we are seeing blockchain rapidly outcompeting traditional financial services and banking solutions, and currently disrupting the venture capital market through token sales. A fully decentralised global financial system is probably only a decade away. Professional services such as accountancy and legal services are likely to follow suit. Governance is a slower burn as its implications are greater still. These evolutions we believe are inevitable.
LABCITIES: How fast will blockchain become part of our life?
James: While many blockchain start-ups are really at the idea stage, some like Pangea are not. Viable technologies will emerge quickly over the next 5 years, and within a decade I believe much of the world will be using many blockchain solutions for everyday tasks. We expect to have 150,000 users of Pangea in 18 months time, and after then? Well there are 3 billion people with no access to governance services waiting for us to give them choices.
LABCITIES: Where do you see the risks in blockchain for the future?
James: Like all technologies, decentralised tech can be used for good or ill. Government private chains can be used to hold biometrics on whole populations, for example, which could in theory be used to elect people for expulsion or even genocide. Immutable ledgers which are not fully encrypted and do not incorporate pseudo-anonymous identities can be used to enslave us, and make tyranny more possible.
LABCITIES: How would you explain to non-technical people the concept blockchain?
James: Not everyone needs to understand blockchain to use decentralised tech applications, just as you don’t need to understand how the internet works to use email. That said I’d probably paraphrase Vitalik Buterin, the creator of Ethereum, who described a public blockchain as a magical machine that all and any of us can run programmes on, where current and all previous actions of every programme are always publicly visible. Because it’s owned by all of a blockchhain’s users and secured by very strong encryption, these programmes can’t be changed by any single person or organisation and it is guaranteed to continue to execute them in exactly the way that this remarkable computer specified when we uploaded them onto it.”
LABCITIES: Do you have exciting news about your company, blockchain and the upcoming year?
James: The most exciting news for Bitnation is that we are running a token sale this winter to raise funds to build Pangea and our ecosystem. The token sale will coincide with the release of Pangea 0.3 MVP, and all being well in early 2018 the Pangea Alpha will be released for iOS and Android devices. Our PAT presale will commence in a few weeks. PAT is an Ethereum compatible in-app token. Our Token Sale Event (TSE) is hard-capped at US$30 million.
10% of PAT will be sold during our pre-sale with a 30% bonus, which is now ongoing. In total, 34% will be sold in the TSE. 34% will be earned on the Pangea platform by Citizens. A further 18% is allocated to the founders and core contributors, and 14% is reserved for future contributions. Our partner, Bitcoin Suisse AG will receive orders and secure funds in escrow.
LABCITIES: Thank you for your views on this exciting market, James.
Would you like to learn more or become part of the Bitnation movement?
Check out the Bitnation profile on LABCITIES
Marc Van Steyvoort
Co-Founder at LABCITIES