Governance in the blockchain era: the smart social contract

What is it about?

Since the emergence of bitcoin, 14 years ago, cryptocurrencies and the blockchain technology that underpins these virtual currencies have experienced a rapid growth, with a plethora of applications emerging. While most popular applications of blockchain technology are in the business field, its main features – such as decentralization or enhanced security – make it suitable to redesign social, cultural and political realities such as the social contract that regulates the relationship between states and citizens. Blockchain-based applications have the potential to change social values and the social contract itself. This paper aims to discover if smart contracts and blockchain technology can bind the social contract between the state and its citizens in such a way as to reduce corruption and increase efficiency of service delivery. Further, the emergence of a new type of social contract will be investigated: the smart social contract. This new concept aspires to enhance Jean Jacques Rousseau’s social contract with the benefits inherent in blockchain technology. It involves an automatic execution of the obligations that a government assumes through a certain program, determined by consensus by all the members of society.

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Photo by Pierre Borthiry - Peiobty on Unsplash

Photo by Pierre Borthiry - Peiobty on Unsplash

Why is it important?

In this paper, we introduce the concept of a smart social contract, which combines the benefits of smart contracts with the fundamental principles of the social contract. Our motivation is to create a decentralized, trust-minimized, and transparent framework that can enhance the social contract's governance and enforcement mechanisms. We contribute by providing an analysis of the existing literature on smart and social contracts, identifying the gaps and challenges in their implementation, and proposing both a theoretical as well as a technical framework for a smart social contract. Furthermore, we present a potential application of the smart social contract in an example of a mayor-led community. Overall, this paper offers a novel perspective on the integration of smart and social contracts, providing insights into the future of contractual relationships in a decentralized world.