Governance in the Sweetbridge Economy

A network of legal entities around the world will provide legal rails for Sweetbridge services and ensure decentralization

In creating a blockchain protocol stack to serve as an extension module to industrial era economic systems, the core challenge confronting Sweetbridge is not necessarily technological but rather one of deploying the technology in a decentralized manner that is compatible with existing economic and legal frameworks.

While blockchain tech has the ability to rewire the world’s financial system and supply chain ecosystems as we know them, it will take time for governments and existing institutions to warm up to these developments. This latency requires that, in many cases, the companies and technologies of tomorrow abide by yesterday’s rules.

This incongruity between the technology and current Industrial Era institutions is a leading reason why cryptocurrencies have yet to make a noticeable dent in real-world economic systems despite having built up $430 billion in total market capitalization.

Laying the Foundation for Commerce in a World Built on Blockchain

This means that in order to provide asset liquidity and settlement through its protocols, Sweetbridge is establishing legal entities in jurisdictions around the world that will serve as hubs throughout its global decentralized economy.

Sweetbridge Entity Map at launch

These legal entities will possess pertinent licenses in their country of domicile to engage in money transmission, hold fiat accounts, dispose of assets when defaults occur and trade in certain asset classes. They must also be able to legally contract for services and employment and will need to provide legal ability for assets to own themselves, which isn’t currently possible in most jurisdictions.

Much like nodes on a blockchain network, they will be fully independent and autonomous from one another, but will share common access to the Sweetbridge protocols, branding and intellectual property.

Collectively, these entities will own and control the global Sweetbridge protocol stack via a mechanism that extrapolates decentralized computer network governance principles to a physical world context.

Each entity will operate as a member-run, member controlled organization, and the global Sweetbridge network will effectively function as a non-profit organization that is owned by its members specifically for the benefit of its members. This arrangement will be similar to a credit union or mutual company in the United States or a Building Society in United Kingdom.

To provide the flexibility needed to adopt necessary future protocol changes while preventing power from becoming overly centralized, Sweetbridge is creating a global governance architecture that becomes more decentralized as the network grows larger while minimizing the potential for any entity or group of entities to override the interests of any minority.

After formal launch, the network will be centrally overseen by the U.S.-based Sweetbridge, Inc. for a two-year period. This entity will serve as the “benevolent dictator” responsible for overseeing the network’s development and the establishment of entities around the world, while assisting with obtaining appropriate licenses and lobbying as needed.

After this two-year period expires, the Sweetbridge network will be collectively governed by all of the existing global entities. Sweetbridge, Inc. will simultaneously commence a 6.5 year self-starvation period during which it will maintain the authority to veto any proposed change put forth by the community.

The self-starvation mechanism will also apply to all entities in the economy, creating an infinite forking mechanism that will incentivize the continual creation of new entities around the world by individuals and groups that agree to abide by the common charter.

The threefold purpose of this arrangement is to encourage and incentivize each entity to be small enough so that it is highly responsive to the needs of its members, foster the network’s continued growth and ensure the network becomes more decentralized as it grows larger.

Through this governance structure, Sweetbridge is tackling head-on two critical aspects that have proven to be the Achilles’ Heel for other cryptocurrency projects to date: integrating with existing legal frameworks and developing a governance structure that forces power to become more decentralized and distributed as the network grows larger.

Stay tuned for more details in our forthcoming Governance Whitepaper.

About Sweetbridge

Sweetbridge is a new economy built for commerce that enhances the world’s current economies. Sweetbridge and its alliance partners offer a unique set of blockchain protocols, applications and crypto-economics to create an economy of opportunity for all participants. The goal of Sweetbridge is to transform brittle, industrial-era commerce through decentralized industry ecosystems that create a faster, fairer value exchange, unleash working capital, better utilize resources, and optimize talent for the benefit of all participants. For more information, follow Sweetbridge on Twitter at @sweetbridgeinc or visit https://sweetbridge.com.