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PDF
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Type:
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Conference Paper |
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Author:
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Howell, Bronwyn E.; Potgieter, Petrus H. |
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Conference:
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Workshop on the Ostrom Workshop 6 |
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Location:
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Indiana University, Bloomington |
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Conf. Date:
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June 19-21, 2019 |
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Date:
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2019 |
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URI:
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https://hdl.handle.net/10535/10528
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Sector:
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New Commons |
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Region:
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Subject(s):
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blockchain
governance
polycentricity
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Abstract:
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"Volatility of crypto currency values, and fears of illegal use, have led to calls for government regulation of the industry. However, it is not clear that third-party governments, more used to regulating fiat currencies, are best-placed to undertake this activity. Drawing from the literature on early self-regulation of share markets in the 18th century and the management of bank-issued currencies in the 19th and 20th centuries, a case exists for self-regulation of crypto currency exchanges. Self-governance tools include internal rules applied by the market operators and the disciplines exerted by those choosing (voluntarily) to trade on them. This draws on the Ostrom legacy the economics of club goods for governing the commons. In this case, the club goods are the rights to use a shared platform and set of rules to transfer value between different crypto currencies, and between fiat and crypto currencies.
We examine the rules associated with embryonic self-regulated clubs of crypto currency exchanges such as the Virtual Commodity Association (VCA) and compare them with the effectiveness of regulatory rules established by governments seeking to use their formal powers of regulation to govern crypto exchanges. We ask whether self-regulatory clubs will be more effective at finding innovative new ways to constrain opportunistic behaviour than third-party rivals."
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