Abstract
This chapter addresses the myth of decentralized governance of public blockchains, arguing that certain people who create, operate, or reshape them function much like fiduciaries of those who rely on these powerful data structures. Explicating the crucial functions that leading software developers perform, the chapter compares the role to Tamar Frankel’s conception of a fiduciary, and finds much in common, as users of these technologies place extreme trust in the leading developers to be both competent and loyal (ie, to be free of conflicts of interest). The chapter then frames the cost-benefit analysis necessary to evaluate whether, on balance, it is a good idea to treat these parties as fiduciaries, and outlines key questions needed to flesh out the fiduciary categorization. For example, which software developers are influential enough to resemble fiduciaries? Are all users of a blockchain ‘entrustors’ of the fiduciaries who operate the blockchain, or only a subset of those who rely on the blockchain? Finally, the chapter concludes with reflections on the broader implications of treating software developers as fiduciaries, given the existing accountability paradigm that largely shields software developers from liability for the code they create.
Keywords: Blockchain, DLT, Bitcoin, Ethereum, Distributed Ledger Technology, Cryptocurrency, Digital Currency, Blockchain Technology, Governance, Fiduciary, Law