Peer Production on the Crypto Commons

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Toward a Commons Based Economy

Commons Based Peer Production (CBPP)


Yochai Benkler wrote about the concept of commons-based peer production in his 2006 book “The Wealth of Networks - How Social Production Transforms Markets and Freedom1, describing its qualities and potential in some detail. Commons based peer production (CBPP) is a new model of socioeconomic production in which people work cooperatively on commons-based (publicly accessible) resources. The most well described and significant examples of CBPP are Free and Open Source Software (FOSS) projects, other examples include Wikipedia, OpenStreetMap and The Pirate Bay.

The Internet has dramatically lowered communications costs, and the costs associated with providing access to information goods. These developments made CBPP possible because they allowed people who shared a common interest to find each other, communicate, share work on a common project, and distribute the product of that work to anyone who wanted it. The low costs associated with communication, production, and distribution meant that there was no need for an organization with capital to take ownership of the projects and run them in a way which would generate revenue.

With these barriers removed, groups of hobbyists could collaborate on projects that they found interesting or useful - and this mode of production has given us the software that the bulk of the Internet runs on. Nadia Eghbal’s Roads and Bridges: The Unseen Labor Behind Our Digital Infrastructure 2 provides an excellent account of the importance of FOSS to our digital infrastructure, why there are issues with funding it and what the consequences are.

The way in which participants collaborate, and the nature of the resource they produce, are also fundamental to CBPP. This mode of production is characterized by openness. In the case of FOSS the software is open source, so anyone can read the code, understand it, and tweak or re-purpose it. This widens the pool of potential contributors to include anyone with an interest in the project who takes the time to understand the product and how it is being produced.

Licensing also plays a role here, with the advent of “copyleft” licenses like the GNU General Public License allowing groups to protect their work and guarantee that they could continue to use and build on the resource, while also preventing any actor from making a proprietary restricted-access version of that resource.

Unrestricted access to the resource and its history results in a kind of equality between participants (peers). Should a conflict arise about the project’s direction the conflicting parties have an option to “fork” the resource and develop alternative versions from that point onwards.

CBPP projects typically lack a hierarchical or otherwise tightly defined structure. Peers participate independently on a voluntary basis, assigning themselves to the tasks they find most interesting or worthwhile. This method of open voluntary allocation seems to offer high efficiency in allocating human resources - more so than top-down management within conventional organizations (with Human Resources departments). GitHub, a key platform for the software commons, and itself valued in the billions of dollars when acquired by Microsoft 3, relies on open allocation internally. Spotify also uses4 an open allocation type approach to organizing its software developers.

In the FOSS domain, ready access to version control and platforms like GitHub have further reduced the friction associated with collaboration, and diminished the benefits of being physically co-located with collaborators.

Modularity of the project is a requirement for CBPP to succeed 1. It must be possible for many individuals to work independently on components which join together to form the product/resource. Where this is true, the benefits of open allocation seem significant.

CBPP also requires a high degree of transparency in organization and decision-making. New contributors must be able to get up to speed quickly on which types of contribution are appreciated or they will likely become disgruntled and quit.

The major limitations of CBPP are:

  1. Funding of work, incentives for workers. Most workers need to derive an income from their work, and have limited time to spend on work which is un-paid. Most software is produced within organizations that generate revenues and profit from its sale or deployment - these revenues can be used to pay workers.
  2. Important work can be dull. Where a project relies on self-motivated and self-funded participants useful but boring work may go undone and this might hamper the project’s progress.
  3. Governance without hierarchy. When work is organized along hierarchical relations, it is relatively clear who has responsibility for making decisions and/or there is a method in place to resolve disputes. Lack of direction or lack of agreement on direction can limit a project’s progress.

Some blockchain/cryptocurrency projects are addressing these limitations in a variety of novel ways. In the following sections, I will outline how CBPP differs to conventional means of production, and how cryptocurrencies differ to other CBPP efforts.

There is much more to a cryptocurrency than the FOSS which participants in the network run, but many of the other forms of work which go into producing a cryptocurrency and giving it value can also be considered as forms of CBPP.


  1. Benkler, Y. (2006). The wealth of networks: How social production transforms markets and freedom. Yale University Press. Online at: [return]
  2. Eghbal, N. (2016). Roads and bridges: The unseen labor behind our digital infrastructure. Ford Foundation. Online at: [return]
  3. Microsoft has acquired GitHub for $7.5B in stock. (n.d.). TechCrunch. Retrieved 8 November 2020, from [return]
  4. Spotify Engineering Culture (by Henrik Kniberg). (2017, February 27). [return]
Last updated on 10 Sep 2019
Published on 10 Sep 2019
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