Your Property Rights Should Extend to Social Media

CoinDesk columnist Nic Carter is a partner at Castle Island Ventures, a venture fund based in Cambridge, Mass., that focuses on public blockchains. He is also the co-founder of Coin Metrics, a blockchain analytics startup.

There are, to put it reductively, two schools of thought on the topic of property rights on internet platforms. The first goes something like this: “Systems like Facebook, Twitter, Google and the like are private platforms, run and administered by corporate entities, and those entities may control the contents of those platforms as they see fit. This extends to banning, censorship, arbitrary content removal, alteration and so on. None of these internet oligopolies “owe anyone a platform” and they have no obligation to amplify any particular voices. If you don’t like it, build an alternative and compete in the free market”.

While this is by far the most popular view expressed on the topic, very occasionally you might hear an alternative, dissenting opinion. It goes like this: “Internet oligopolies are not just “social media platforms.” They are novel, alternative jurisdictions where users settle and build social and commercial relationships. While they are not physically instantiated, they are genuine places, with all the considerations that entails. Terms of service in these digital frontiers actually constitute legal systems, albeit poorly codified and unaccountable ones. What users do when they occupy handles and build out reputations and social graphs on these systems is create property. Thus censorship, de-platforming, and the like must be understood as eminent domain and expropriation, rather than a mundane application of rules”

Under this alternative view, espoused by thinkers like Elaine Ou, Allen Farrington and Balaji Srinivasan, Facebook, Twitter, et al, did not really create all the content on their platforms, nor do they really own it. Instead, they define a namespace that users occupy, build upon, and in some cases commercialize. The users, not the administrators, create the vast majority of the value, and as such are the rightful owners of their digital property.

You might think this is crazy. But in a sense squatters asserting their property rights against an authority that lays a blanket claim to them would be nothing new. That’s the legal struggle that defined the history of the American continent. (For a full treatment, see chapter five of Hernando De Soto’s “Mystery of Capital.”) Initially, large tracts of land were claimed primarily by the states and absentee landowners. Over time, squatters were able to argue persuasively they had put sufficient labor into their homesteads to legally ratify their informal claims. On the internet, asserting rights to property has proved more challenging, giving rise to our present reality where content creators are providers rather than owners.

The default narrative has suffered some blows lately. The rise of more intrusive fact-checking on platforms like Twitter, Facebook and Instagram has called into question their neutrality. The emphasis on algorithmic curation of content rather than linear timelines allows the architects of these systems to pick winners and losers, selectively boosting topics of their choosing. The growth of implicitly state-controlled platforms like TikTok, where China-directed censorship is a key design feature, has made it clear these systems are powerful tools for power projection. And the consolidation of internet platforms into static oligopolies — Facebook and Google jointly control at least 60% of the digital ad market — has dented the theory that users can simply just move elsewhere.

In the face of this overt politicization of purportedly neutral platforms, the theory of digital property rights that stresses the primacy of the individual (i.e. the second view) looks decidedly more attractive. But what exactly are the moral grounds upon which individuals can formalize a claim to their digital property? Lockean theory (see Elaine Ou above) posits that mingling one’s labor with some unallocated natural resource – for instance, by tilling the soil and growing crops – endows an individual with the bequeathable right to that property. The most controversial element of Locke’s theory stipulates the enclosure of some land for the purpose of creating property is morally acceptable if that enclosure doesn’t disadvantage anyone else. In Locke’s words:

Nor was this appropriation of any parcel of land, by improving it, any prejudice to any other man, since there was still enough and as good left, and more than the yet unprovided could use.

Now, if you consider the American frontier, the process of enclosure required the forcible expulsion of the local Native American population, so the proviso appears problematic at best in that context. But in the context of the post-scarcity digital frontier, Locke’s proviso holds weight: Creating an account on Twitter hardly disadvantages anyone. By creating a new, infinitely extensible frontier, an unambiguous moral case exists for the enclosure and allocation of property, without the precondition of violence.

I don’t expect the property view of digital platforms to be persuasive to all. Even so, it functions well descriptively. Instead of accepting the fraying default view you can simply begin to imagine all of the internet platforms that exist today as a constellation of digital nations, each with their own legal code and with varying levels of respect for the property of users.

“On the internet, asserting rights to property has proved more challenging, giving rise to our present reality where content creators are providers rather than owners”, Nic Carter said.

Unfortunately, property rights on the largest platforms are both poorly codified (the Terms of Services are crazy shifting sands, arbitrarily sanctioning user behavior, implemented by unaccountable bureaucrats) and notoriously weak. Users cannot easily extricate their social graphs and followers should they choose to leave; they find themselves deprived of their commercially and socially valuable property at a moment’s notice with no recourse and they cannot influence decision-making. To make a political analogy, virtually all of these digital worlds operate as pre-democratic feudal regimes, with every participant a digital serf who tills the land at the pleasure and discretion of a capricious feudal lord.

The property view equips us to better understand digital society. We can expect that if the major platforms continue to operate as unaccountable fiefdoms, users will gravitate towards systems that are more politically stable, those that enumerate and define the rights of users (rather than just listing, Ten Commandments-style, various bannable offenses), and enshrine genuine protections of property.

Understood this way, it’s clear the current largest internet platforms are taking an unsustainable approach to digital governance. If the administrators of these systems were forward-looking, they would seek to stabilize the legal structure of their systems and clearly lay out the rights of users, as no one wants to build on a shifting foundation. It’s well established that something as basic as a legal philosophy (for instance, the presence of common versus civil law) has far reaching impacts on economic growth. And thanks to De Soto, we know that giving individuals the ability to formalize a claim to some property they own is the genesis of productive and healthy capitalism. So it stands to reason that the first platform to carefully codify rules and give users strong guarantees over their property will gain market share.

The popular internet platforms most likely cannot make this transition. They exist in a very real political context and are coerced into following local laws and intervening in political disputes by selectively banning individuals and de-boosting particular topics. Since internet platforms grant governments almost infinite leverage when it comes to controlling speech, infiltrating and co-opting those companies is an urgent, active priority for state actors.

We wonder whether any alternatives to these shoddy systems are emerging. The good news is that some diligent entrepreneurs have been pursuing this vision for some time now. In 2009, a group of cypherpunks created a system of property that was user-defined, issued freely and fairly, one in which ownership was a function of one’s knowledge of cryptographic secrets. The slots in the ledger didn’t mean anything, but they came to possess financial value — because society unsurprisingly treasured a system of property which was state and oligarch independent. In a sense, Bitcoin offers some of the strongest protections for digital property ever devised, shrugging off state rules and making eminent domain, civil asset forfeiture, inflation, censorship and other forms of implicit and explicit seizure extremely difficult to impose.

Other builders took inspiration from Bitcoin’s treatment of property rights, envisioning systems in which knowledge of a private key is the arbiter of identity, instead of an entry in the database of a Silicon Valley megacorp. This is the idea underscoring the Web 3.0 movement, which has stagnated since its popularization in 2017/18. But the concept is profound: equip users to formalize their own social graph and tie a reputation to an online entity with the absolute right to withdraw or migrate should they be mistreated by their local platform administrator. The precise form this will take is not clear. But it is an idea whose time has come.

According to CoinTelegraph