Some preliminary thoughts and ideas – what evolves remains to be seen!
An idealised decentralised blockchain ledger system is a distributed network in which no single authority controls the record of transactions, and instead trust is established through transparent rules, cryptographic verification and messaging, and collective consensus among participants — in ‘permissionless’ systems, participants can be anyone. These elements are what makes such systems ‘permissionless’. As well, each participant can independently verify the integrity of the ledger, while data is replicated across many nodes (e.g. computers) to ensure resilience and resistance to tampering. Transactions are validated according to agreed protocols, recorded immutably, and made openly auditable, reducing reliance on intermediaries. In this sense, the system is often described as ‘trustless’, meaning that participants do not need to rely on intermediaries or personal trust in others, but instead on the operation of the protocol itself.
In this model, governance is ideally decentralised, incentives are aligned to secure the network, the system is secure through the use of cryptography, and it operates predictably through code, enabling coordination among participants without requiring prior trust. Tokens arise in the blockchain system as digital units created by a protocol to represent value, rights or access, typically issued through rules encoded in the system such as mining, staking, or smart contracts. It is these various elements that can give tokens exchange value or purchasing capacity where they are accepted, which in turn underpins their perceived value within and across systems.
This article though is really not so much about what blockchains can do but what they ought to do in cooperative or solidarity-based economic systems. Perhaps much is speculative. Certainly, blockchain as used today is not value-neutral. Its design embeds assumptions about ownership, control, incentives and trust. These assumptions often arise from technological cultures and economic ideologies in which blockchains were and are being developed. In the current era, we can point to particularly libertarian, market-oriented, and cryptographic trust-minimisation paradigms that prioritise individual sovereignty, scarcity and decentralised exchange.
Cooperative economics
In cooperative economics, this would involve entities such as co-operatives, mutual associations, and commons venture. The concern then is more like how do we ensure blockchain systems reinforce cooperation rather than reproduce extractive or speculative dynamics? That brings us to the question of what normative framework should guide blockchain use in cooperative economies?
Those core values for blockchain revolve around the same core value of cooperatives. Though this does not at all assume a one size fits all model for cooperatives. Cooperative thinking and structures are evolving. The philosophy, economic and legal structures are not static.
The below sets out some defensible governing values, grounded in cooperative principles. Here, governance refers to how decisions are made, rules are set, and changes to the system are agreed upon and enforced. In blockchain contexts, governance tends to be, and generally is supposed to be, decentralised, i.e. distributed among participants). However, centralised governance has emerged in certain blockchains, i.e. controlled by a small group, as well as hybrid governance. While early blockchain thinking favoured strong decentralisation (‘trustless’ coordination without central authorities), in practice viable systems often adopt hybrid models that combine decentralised participation with some structured coordination to remain effective and adaptable.
Collective benefit balanced with individual benefits (or extraction)
This means technology should maximise shared welfare and community resilience while also developing individual well-being. Thus, blockchain would support shared or cooperative ownership models and fair distribution of value, in a way that holding cooperative shares or participatory interests can do. It would not aim for speculative gain or rent-seeking. Unfortunately, many blockchain systems are structurally incentivised toward speculation and value extraction, which undermines cooperative aims unless deliberately redesigned. Importantly, this incentive structure is not inherent to blockchain technology itself, but rather a design choice that can be reconfigured toward cooperative and non-extractive outcomes.
Democratic governance
This means decisions should be participatory, transparent and accountable. Therefore, for example, not controlled by developers or dominated by token whales. A ‘token whale’ is an individual or entity that holds a very large amount of a particular cryptocurrency token, giving them significant influence over its price and market dynamics.
Transparency with accountability
Blockchains do already enable transparency, but in cooperative thinking transparency would be paired with responsibility, explainability and human oversight. But with human oversight there lies a problem with blockchain (as we know it). The problem is that meaningful human intervention often conflicts with the immutability and automation of blockchain ledger systems. These two factors make it difficult to exercise discretion without undermining the ‘trustless’ assumption that blockchain systems are built upon. The trustless assumption is the idea that a blockchain system is designed to function without relying on trust in any individual, intermediary or authority; instead depending solely on code, rules/protocols, cryptography and distributed consensus.
Subsidiarity (local control)
In cooperative economics, decisions should be made at the most local, appropriate level. While blockchain does support this by giving individuals direct control (e.g. via private keys), in practice decision-making has often become shaped by concentrated token ownership, sometimes developers, or semi-centralised governance structures. Cooperatives, however, require a cooperative spirit and collective agency, not just individual autonomy. Therefore, blockchain systems would be designed to empower local communities and shared decision-making, rather than reproducing centralised control in the hands of remote governance elites, which ultimately undermines both cooperative principles and the original decentralising aims of blockchain.
Fair distribution (anti-concentration)
This principle avoids wealth concentration, as well as governance capture. Cooperative design mechanisms for blockchain would be around limiting accumulation of power and preventing token-based oligarchies (and again such centralisation is fundamentally contradictory to original or idealistic blockchain thinking). In practice, achieving fair distribution would be workable but requires deliberate mechanisms such as caps on voting power, quadratic voting (votes are equal to the square root of tokens held), identity-aware participation (influence is tied not just to how many tokens a person holds, but instead to some notion of unique, verifiable identity, such as ‘one person’ rather than ‘one token’), or various redistribution models. These can be technically implemented but must be carefully governed to remain effective and resistant to manipulation. But again, bringing in human governance does involve some centralisation, which is contrary to original decentralised blockchain thinking.
Human-centred design
This means technology should serve human dignity and social cohesion, not abstract efficiency or purely algorithmic outcomes. However, again this brings in some form of coordination or centralisation, and the problem of how to meaningfully encode such qualitative human values into programmable systems. Moreover, human-centred outcomes often require discretion, context and ethical or moral judgement, which resist rigid rule-based execution. Though this does expose the limits of purely code-driven governance. This suggests that viable blockchain systems based on a cooperative spirit may need hybrid models where code provides structure, but human institutions retain a role in interpretation, exception-handling, and ethical oversight.
Intermediary trust minimisation — but not trust elimination
This means to reduce blind trust in intermediaries, but not eliminating human judgement or ethical oversight. Basically, cooperative systems require trust and relationships, not just coded procedures. A viable approach in cooperative contexts is to shift from blind trust to structured trust, where transparency and verifiability of blockchain systems support social accountability. This allows trust to be distributed and reinforced through shared norms, reputation and participatory governance, making the system both resilient and aligned with cooperative principles. Again, however, this moves away from completely decentralised blockchain governance, and brings in harder variables to code.
Sustainability (economic and environmental)
This means blockchain systems should be energy-efficient and socially sustainable. This avoids extractive mining models and short-term token incentives. A mining model is the mechanism by which a blockchain rewards participants for validating transactions and securing the network, typically through the creation and distribution of new tokens. Environmental sustainability means minimising energy use and resource impact, for example by using low-energy consensus mechanisms instead of energy-intensive mining. Economic sustainability means the system creates long-term value for participants without relying on unnecessary speculation or extensively on external oracles/inflows such as prices. Implementing this may not be inherently hard to code at a technical level, but it is difficult to design well because it requires aligning incentives, governance and long-term behaviour rather than just writing efficient code.
Interoperability with social systems
Blockchain in cooperative economics would integrate with legal systems and institutions, and economic planning from bottom-up. So, blockchains are not just existing supposedly as isolated techno-utopias. However, achieving this interoperability is complex, as legal rules, social norms and institutional processes can be ambiguous, are evolving, and are context-dependent. Whereas blockchain systems rely on rigid, predefined logic. There are also practical challenges in aligning on-chain actions with off-chain enforcement, identity and accountability, which can create gaps between what the system records and what actually occurs externally in the real world. This means effective interoperability requires not just technical bridges, but ongoing coordination between technological design, legal frameworks, and human institutions. Again, the original ideas of complete blockchain decentralisation is diluted (but it raises the question of whether such blockchain idealism was ever possible).
Ethical restraint (appropriate use)
Just because blockchain can do something does not mean it should. For example, surveillance-heavy ledgers, immutable harmful data, and exploitative tokenisation. In practice, these are not automatically avoided in blockchain systems and could even be structurally enabled, meaning that both system design choices and individual behaviour can produce manipulative or harmful outcomes unless deliberately constrained.
Surveillance-heavy ledgers would be a public ledger that permanently records detailed transaction histories linked to identifiable individuals (which blockchains seek to avoid), allowing governments or corporations to track behaviour and spending patterns. Immutable harmful data is the storing sensitive or harmful content, e.g. personal data or defamatory material, on-chain where it cannot be removed, even if it causes ongoing harm. Though this would be contrary to privacy laws, defamation laws, and other anti-harm laws. Exploitative tokenisation in a system-gaming financial sense would be designing token reward schemes (e.g. yield farming) that allow early or large holders to extract disproportionate returns, effectively draining value from later participants. Also, creating governance tokens that can be cheaply accumulated and then used to pass self-serving proposals (e.g. treasury payouts), enabling coordinated actors to capture shared funds. Though, there are a range of legal disputes before courts that have begun addressing exploitative financial practices.
Conclusion
So the real issue is: can blockchains be redesigned to align with cooperative ethics, or do they inherently drift toward financialisation and concentration? There are reasons for optimism. We already know that use of blockchains in a system can enable participatory governance at scale. Nor is blockchain fixed in its trajectory. It has become a flexible tool whose outcomes depend, in part or even significantly, on the values embedded in its design. However, embedding cooperative values would require some degree of coordination or structured governance centralisation, which can dilute pure decentralisation aims envisaged by blockchain proponents, but this would be justified where it enhances overall socio-economic welfare, fairness and accountability.
At the same time, we have to recognise that we live in the mercantile era, which on the negative side (and more likely part of its inevitable downfall) has increased tendencies by a few for wealth concentration in the hands of that few. Money psychology is also rampant. Mercantilism and forms of capitalism (state or market or mixed) are the dominant social psychology. So, what this means and alludes to is a change in social psychology. Like any major socio-economic changes this has to happen to lead to overall social welfare (both collective and individual). It usually happens through thesis challenged by antithesis, which leads to a new synthesis.
Lastly, we can also say technology is a thing that has required governance in one way or another, so is not just infrastructure, and while blockchain is a technology it is also a ‘constitution’ encoded in software. So, the real task is designing cooperative constitutions in code. Blockchain in cooperative economies should be governed by values of democratic control, fairness and transparency, among other cooperative principles, otherwise it risks reproducing inequalities it aimed to overcome. Perhaps even the entire code could still result in a completely decentralised system, but with a cooperative spirit? Can it be done?
https://open.substack.com/pub/macropsychic/p/what-values-would-govern-the-use
