303. The Network State with Balaji Srinivasan

Saifedean Ammous (0:06)

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Balaji Srinivasan (1:15)

Thank you, I'm happy to join with the author of The Bitcoin Standard. The Bitcoin Standard meets The Network State. This would be in like 10 years in the making. What a crossover, The Bitcoin Network State has to happen as well, so very good to see you.

Saifedean Ammous (1:27)

Yes, I'm glad we're finally going to sit down and hash out the details of the future.

Balaji Srinivasan (1:32)

Great.

Saifedean Ammous (1:34)

All right, so I guess why don't you tell us what is the Network State?

Balaji Srinivasan (1:39)

Sure. I can show, can I show a visual? Yeah. Can I project? All right.

Let me show a visual because that picture sometimes says a thousand words. So share screen, share tab. Okay. So if you just go to thenetworkstate.com, and if I zoom in, go to the Network State in one image. Okay. And this right here, can you see that on the screen?

Saifedean Ammous (2:06)

Yeah.

Balaji Srinivasan (2:07)

Okay. That is a mock up of a network state. What is it? It's very concrete. It's a physical social network. So let's say this is a network state that has 1,729,314 people with annual income, in this case, of $157 billion a year. I didn't put it in Bitcoin terms because it's undefined yet, but fine, just assume. At 136 million square meters. And it's got physical nodes around the world. It's as if every Chinatown in the world was networked together with modern communication technologies and with Bitcoin and with Starlink and so on and so forth. And it's got these little sub-developments in every city that are actually not so little because you could have tens of thousands, even 100,000 people there. And together, the population income and square footprint or physical footprint of a network state is comparable to that of a legacy nation state. And then here is a GIF where I'll zoom in here. And let me zoom in. But basically this shows how a network state can emerge. You start with, you know, and this will loop in a second. We'll start with one guy. And then it'll go from over here. It'll go from one, then 17, 172, 1,000, 17,000, 100,000, a million. And if you look, you basically decentralize and you go into more places around the world and you basically build out the network and you've got more and more nodes. And so if Bitcoin is a decentralized currency, the network state is a decentralized country.

So that's the idea. There's much more I can say, but that's a fundamental concept.

Saifedean Ammous (3:47)

Yes, but how does that actually function as a state? So you're not saying here that this is going to be a federation of all of these cities, say Tokyo and Mumbai and Dubai are going to be part of the same state. You're saying people in those places will join states that cross these borders, but other people in the same city will be joining other states, all other network states.

Balaji Srinivasan (4:11)

That's right. So like the Ottoman Millet system, for example, right? So let me give some precedents or precursors. So for example, Google has offices all around the world, right? Hilton or Marriott, they've got hotels all around the world. Starbucks has obviously, like restaurants or whatever you call them, coffee shops that are all around the world, tens of thousands of them. And they're all part of the Starbucks network, the Hilton network, the Google network. They're physically located in those jurisdictions. They're under, in some sense, the laws of the states that they're in. But really, much of what happens within those buildings is really bound by, let's call it the private law of Starbucks or Hilton or Google. Like, for example, their brand is on the walls, their mores basically govern who's in there, and you can swipe a card at Google San Francisco and get into Google Berlin or Google Bangalore, and you're really on, in a literal sense, the same network, in the sense of the same intranet that connects all these places, right?