Diffuse Value Capture

1 Definitions

Diffuse: Widely spread out rather than concentrated; dispersed across many points, participants, or locations.

Direct value capture: many-to-one, closed, permissioned.

Diffuse value capture: many-to-many, open, permissionless.

Direct and diffuse value capture exist on a spectrum; extremes on either end are rarely workable.

2 Thought Experiment

Alice and Bob both work 30 hours per week creating a similar digital good. They aim to capture value in various forms, such as money and social capital.

Alice captures 90% of the value created, and Bob captures 10%, but Bob still captures slightly more value than Alice—one whole unit—with the same amount of work. This is effective diffuse value capture.

There is no upper limit to how much value one person can create. Producing 1,000 units and capturing just 1%, or producing 1,000,000 units and capturing 0.001%, can still yield meaningful returns.

3 Authorship & Originality

Authorship and originality also exist on a diffuse-to-direct spectrum.

For most of human history, cultural production was diffuse. People wrote stories based on other stories, and sang songs based on other songs. Authorship and originality were diffuse.

Before the printing press, works often circulated anonymously or under the names of famous figures to lend prestige. Scribes copied manuscripts freely and without permission. Because duplication was so labor-intensive, limiting copying wasn’t a practical concern.

Ideas about authorship and intellectual property were shaped by the current level of technology for reproducing information.

Since the introduction of the printing press, Western cultural production has become increasingly direct, culminating in the pre-internet era of Hollywood, television, music, and publishing.

At the peak of this direct cultural wave, the personal computer emerged, initiating a shift back toward diffuse cultural production—not as a return to pre-industrial models, but as new models made possible by decentralized global computer networks.

There was a 250-year gap between the European printing press and the establishment of modern intellectual property law. While cultural timelines have accelerated, there remains a persistent lag between technological change and cultural adaptation.

We are only at the dawn of the internet today.

4 Neo-China Arrives from the Future

The diffuse-to-direct spectrum varies regionally. In the Far East, concepts of authorship and originality differ in ways that are not solely shaped by technology, but are deeply rooted in ancient Eastern religions and philosophies.

In Chinese thought, originality is not defined by a singular act of creation, but by an ongoing natural process—less about fixed identity, and more about continual transformation. Skillful reference signals depth of knowledge, and originality lies more in subtle recombination than in radical novelty.

In November 2023, DeepSeek-AI open-sourced its DeepSeek-LLM models, which already outperformed Meta’s Llama 2 on code and reasoning benchmarks. Fourteen months later, it unveiled DeepSeek-R1, a 671-billion-parameter model that matched GPT-4 on key metrics. The company reported a final training cost of under $6 million—far less than what U.S. flagships spend. Today, a 100GB download and a few consumer-grade GPUs are enough to run and fine-tune a frontier-class model at home.

Western incumbents still cling to a direct value capture mindset—API call metering, closed-source weights, NDAs—while Chinese labs treat the model itself as a form of advertising for downstream services, hardware, and prestige. A thin proprietary layer provides just enough coordination to serve as trading alpha for their AI quant funds.

This is diffuse value capture in action, arriving just as American IP maximalists and AI safetyists lose the plot, scrambling to monopolize and control the AI industry.

Western critics often portray China’s loose stance on intellectual property as a drag on innovation, but in an AI-driven century, it may prove prescient. Is it possible the West took the wrong path—and that ancient Chinese views on authorship and originality, rooted in naturalistic processes and continual transformation, will more closely resemble the IP norms of the 21st century? Less a God-like act of creation from a single source, and more like evolution itself.

The “Chinese century” might not be defined solely by GDP or rare-earth supply chains. It could be shaped by open-source abundance versus closed-source scarcity—by diffuse value capture rather than direct value capture.

China’s leadership still describes the country as moving toward communism. Beijing’s roadmap talks about deepening socialism with Chinese characteristics in two big steps—“basically realize socialist modernization” by 2035 and build a “great modern socialist country” by the middle of this century (2050). Given the Chinese aproach to authorship and originality, and the sucsess of DeepSeek, I think it is very likely that this looks like open-source adundance and diffuse value capture.

A useful lens here is Marx’s idea of the “general intellect,” which anticipates how collective knowledge—once embedded in machines and networks—can eclipse individual labor as the chief driver of growth.

Much of the failure of socialist experiments after Marx can be traced to attempts to solve problems created by direct value capture using even more direct value capture—replacing markets with bureaucracy and coercion. That approach conflicts with Marx’s own expectation that a mature communist society would see the state gradually wither and that a long period of free-market capitalist creative destruction is a needed precondition for the transition to communism. Esentially that capitalism is a process that will evolve into communism no matter what anyone tries to do, and often it is the dumbest exesses of the prolitariat like crypto memecoins and NFTs that that move the gears of history forward.

In practice, neither direct nor diffuse value capture requires a totalitarian apparatus to enforce it. Capitalism has no aligance to closed proprietary systems, as evidenced by the rise of open-source software and the success of cryptocurrencies.

Because value increasingly comes from shared pools of code and models, efforts at direct capture—exclusive IP, closed weights—create friction, while diffuse capture unleashes information flow and strengthens the network.

5 Neural Networks are Diffuse

Contemporary culture, finance, and law are still skewed toward direct value capture—but recent advancements in AI are beginning to expose and intensify the longstanding flaws in this model. Neural networks are diffuse by nature; direct value capture does not map well onto them.

Art, music, code, design, and other cultural artifacts—culled from the open web—are diffused across latent space. Once creativity is encoded as a multi-trillion-parameter fog, the notion that you can meter each droplet of inspiration the way you once metered a DVD sale becomes economically and technically incoherent.

A neural network does not store information like a database storing rows. Any given weight is meaningless in isolation; value emerges only from the statistical interference of all weights acting in concert. Like pigments blended into paint, the original sources are no longer separable—you can’t point to a specific coordinate and say, “this vector belongs to that copyright holder.”

Listen to current conversations around AI and intellectual property and you’ll find little consensus on how to preserve the existing IP framework in this new era. Proposals for radical reform—once confined to the lunatic fringe—are now gaining traction in mainstream tech circles.

I agree

— gorklon rust (@elonmusk) April 11, 2025

The increasingly diffuse nature of cultural production—and the growing openness to new ways of thinking about intellectual property—is a direct consequence of technological trends:

1. The rise of decentralized networks over traditional media and finance.

2. Massively accelerated AI-driven content creation, built on a remix paradigm and inherently diffuse models.

3. Hyperfinancialization, which blurs the lines between leisure/consumption and labor/creation online.

This shift isn’t driven by political will or personal preference. Information “wants” to be free, just as water wants to flow downhill—a constant, unidirectional force that doesn’t reverse with each barrier it breaches. Efforts to restrict the internet may delay its progress, but they never succeed in stopping it—not in any timeline.

6 The Hacker Ethic & Free Information

Computers speak in copies, and the cost of duplication is effectively zero. When the medium itself is infinite replication, the default economic model can no longer be scarcity—it must be abundance and sharing.

The architecture of computing encodes this “hacker ethic” at its core, much like how neural networks are diffuse by nature.

Artificial scarcity imposed by legal means in the digital realm is an awkward simulacrum of real-world scarcity. Forcing physical-world notions of property onto information systems creates endless friction and runs counter to the grain of the medium. This primal, often unspoken orientation at the heart of computing is what Richard Stallman later formalized as software freedom.

Free software—and its defanged offshoot, open source—has been at the core of computing culture ever since. As a result, programming culture has adapted to the shift toward diffuse value capture more readily than most other industries. In contrast, neighboring professions have struggled to move beyond the 20th-century mindset of direct value capture, along with its emphasis on authorship and originality.

Even within programming culture, there’s a gap between those who create value and those who capture it. Bill Gates’s fortune dwarfs that of Linus Torvalds or Richard Stallman, despite the latter having contributed significantly more to computing and the world at large. In Gates’s famous Letter to Hobbyists, software is treated as a naturally scarce product—no different from hardware. The diffuse nature of software and its unique economic properties never enter the picture.

Despite its massive success, free and open-source software culture still struggles to develop effective systems for value capture and coordination. In many domains, it remains a niche—often relegated to controlled opposition, hobby projects, unpaid or underpaid labor, résumé padding, or pawns in commoditize-your-complement strategies. The ecosystem continues to grapple with how to natively and diffusely capture value and coordinate production on its own terms.

Corporate patronage has been a primary driver of open-source development and one of the main ways value is captured from it. However, the direct value capture systems used by big tech often run counter to the diffuse nature of open-source.

Corporate patronage is inherently direct. It involves layers of bureaucracy and middlemen, with everything needing to be accounted for in ways legible to middle managers of middle managers. This creates blind-metric behavior, where open-source developers chase arbitrary KPIs rather than focusing on actual value creation. It slows down development and adds friction to the open, collaborative ethos of open-source.

Once an open-source developer becomes integrated into the direct value capture system of corporate patronage, they’re incentivized to gatekeep their work to preserve personal advantage. This reduces incentives to share knowledge, mentor others, or collaborate openly—all the properties that make open-source so powerful.

By contrast, diffuse value capture strategies align incentives with openness and collaboration. The more knowledge you share and the more you help grow the ecosystem around your project, the more value you can ultimately capture. While some degree of gatekeeping is necessary to protect community culture, the unproductive information asymmetry and cronyism produced by direct value capture systems are less financially incentivized in diffuse models.

With diffuse value capture the hacker ethic becomes fully aligned with financial incentives and competition at the highest levels of the market—where previously, it stood in tension with direct value capture.

The coordination mechanisms required to compete with companies like Apple and Nvidia as fully open-source organizations remain elusive. Still, the dream of “the year of the Linux desktop” refuses to die, and projects like Blender have managed to thrive—and nearly dominate their niche—despite chronic underfunding.

One notable exception is crypto. Open-source and diffuse by nature, it has created and captured a staggering amount of value. Yet it remains controversial and underutilized in many free and open-source software circles.

It’s notable that Google—the company behind the “Attention Is All You Need” paper that helped ignite the current AI hype cycle—now has a market cap smaller than a decentralized, open-source project with an anonymous founder. Many of the failure modes of direct value capture are evident in Google, while cryptocurrencies are, surprisingly, defying many of the failure modes typically associated with open and decentralized projects. What’s going on here?

7 Crypto & Diffuse Value Capture

Technology should be deflationary—every efficiency and automation ought to push prices down in a competitive free market. Yet almost all goods and services feel noticeably more expensive each year. Why is that?

In the United States, the broad money supply (M2) grew by roughly 40% between early 2020 and early 2025, masking the natural price reductions that technology and automation would otherwise deliver. To preserve purchasing power, simply saving in a hard-money asset—one with a fixed supply—like gold or Bitcoin offers a bureaucracy-free way to diffusely capture value from technological progress.

Gold’s main weakness as money is that it only solves scarcity—not speed or security in a digital world. It’s heavy to ship, difficult to divide finely, and costly to verify. As a result, people store it in banks and transact using paper or electronic claims instead. But that custody layer reintroduces the very counterparty risk, government control, and inflation-by-decree (via unbacked IOUs) that gold was meant to eliminate—while still exposing holders to confiscation and inflation via mining. A purely digital, finite asset like Bitcoin avoids all of these problems.

Like gold, Bitcoin has many advantages over real estate. Houses are non-fungible, non-transportable, non-divisible, and not instantly liquid. Ownership is taxed, maintenance is an ongoing cost, and there’s always the risk of natural disasters or other catastrophes.

When single-family homes become a store of value, a monetary premium is added on top of their use value as shelter. People end up paying more than necessary just to secure basic housing.

Cheap housing is a form of diffuse value capture—it allows people to pursue activities with less direct value capture, such as maintaining independent open-source software or inventing new technologies without the burden of restrictive IP. We’ve seen this dynamic play out in cultural hubs like New York City and Berlin, where low-cost living initially enabled diffuse value capture in the form of art, music, and experimental technology. These activities made the cities more desirable, creating a positive feedback loop of diffuse value creation—until rising housing costs pushed out the very activities that made those places attractive, replacing them with direct value capture and eventually stifling innovation.

In these situations, many of the people investing in real estate are simply wealthy individuals seeking assets that preserve or grow their capital. But if Bitcoin and other cryptocurrencies offer better long-term capital preservation than real estate, why not put that capital into crypto instead?

Doing so would be a boon for diffuse value capture—and for housing affordability, which remains a major quality-of-life issue for millions.

”I’m going to list this median house for 3x what the median family can afford.” pic.twitter.com/TCW9XeV8Q2

— Darth Powell (@VladTheInflator) April 15, 2025

A slightly more advanced form of diffuse value capture than gold or real estate is the use of S&P 500 ETFs and the Boglehead investing strategy. These approaches allow individuals to capture value from the economy as a whole with minimal bureaucracy and few middlemen. Whatever value you create but fail to capture directly may be absorbed by companies like Google or Microsoft—and broad market exposure lets you reclaim a portion of it.

However, the S&P 500 faces a similar issue to real estate: it’s increasingly used as a store of value and an inflation hedge, rather than for its original purpose—investing in innovative companies. As a result, equities can accrue a monetary premium beyond their speculative value, artificially inflating prices and distorting the market. This dynamic can make market data less meaningful and extend the lifespans of companies that have ceased to innovate, preserving stagnant bureaucracies long past their prime.

Is Apple in 2025—long after the era of Steve Jobs—still a strong speculative investment worthy of a $3.1 trillion market cap? How much of Apple’s valuation reflects genuine belief in its capacity to innovate, and how much is simply driven by ETFs parked in retirement accounts?

Wouldn’t we live in a healthier economic system if the stock market returned to being primarily a platform for speculative investments in innovative companies—instead of a repository for overgrown monopolies that have become too big to fail due to their role as passive stores of value?

The equity market presents numerous challenges to diffuse value capture. Many of the best investment opportunities—such as private equity and venture capital—are inaccessible to the average person. These markets are heavily gatekept: to participate, you must be an accredited investor, meet minimum income or net worth requirements, and afford high minimum investment thresholds. In practice, the public market often serves as a way for private equity to sell to the public after most of the returns have already been captured by wealthy insiders.

Even today, the average American can’t invest in most leading AI companies like OpenAI or Anthropic. Retail investors seeking AI exposure are pushed into proxies like NVIDIA—but buying NVIDIA stock is essentially a bet on its proprietary, direct value capture strategy, not on AI itself, which has the potential to unlock technologies capable of disrupting previously stable value capture moats like NVIDIA’s.

In the U.S., individuals are allowed to buy lottery tickets and gamble at casinos, yet are “protected” from accessing early-stage startup equity—supposedly for their own good. The traditional financial system is simply too closed, proprietary, and gatekept to enable diffuse value capture at the scale demanded by AI and other emerging technologies.

To me, it’s clear that global capitalism now requires open, fair, permissionless, and 24/7 financial infrastructure.

After Bitcoin’s success, many new blockchains emerged, featuring smart contracts and decentralized applications with the potential to replace the traditional financial system with open-source infrastructure—much like open-source software replaced proprietary software in the server-side battle in the 1990s.

These systems are open and diffuse by design. Just as computers are inherently aligned with free information and effortless copying, and neural networks are diffuse by nature. The diffuse-to-direct orientation of the upstream infrastructure often has downstream effects on how the technology is used, making programable blockchains like Ethereum more condusive to diffuse value capture.

If Bitcoin is digital gold, then Ethereum functions more like a public world computer. Ethereum lets anyone deploy a programmable token (an ERC-20 smart contract) that is immediately tradable on open, permissionless exchanges. Holders can pool two tokens in an automated market-maker like Uniswap, set (or accept) a swap fee, and earn a share of that fee for supplying liquidity—no bank or broker in the loop. The yield that banks normally pocket on deposits flows straight back to participants, a textbook case of diffuse value capture.

While finance is Ethereum’s most developed use case, its potential extends far beyond. As a general-purpose platform, Ethereum is also a fertile ground for cultural experimentation. One of the highest-market-cap tokens on the Ethereum blockchain isn’t tied to finance at all, but to internet culture: 0x6982508145454ce325ddbe47a25d4ec3d2311933, $PEPE.

Pepe the Frog is a prime example of the shift from direct to diffuse culture. The character was created by Matt Furie in 2005 as part of his comic Boy’s Club. Pepe’s origin followed the traditional model of direct culture: a single creator and copyright holder with full control over the character and its world.

However, it’s worth noting that Matt Furie’s art style is a psychedelic blend of the media consumed by Gen X and Elder Millennials growing up in the 1980s that often dosn’t try very hard to disgues it’s influences. His work evokes distorted echoes of pop culture icons—Jim Henson’s Muppets, Ronald McDonald, Skeletor, Freddy Krueger, the Ninja Turtles, or Falkor from the Never Ending Story—all diffused through Furie’s own surreal lens. In this way, he represents an interesting checkpoint in the transition from direct to diffuse culture.

This highlights a core tension in direct value capture systems: at some level, everything is a remix. Yet direct value capture requires a certain level of abstraction away from source material to meet legal and social requirements for originality—asserting authorship and ownership over what is, in practice, always partially derived.

The Pepe the Frog character became an internet meme as his popularity steadily grew across platforms like Myspace, 4chan, and Tumblr starting in 2008. By 2015, he had become one of the most widely recognized memes on the internet. Pepe began evolving in a decentralized, memetic fashion—without a central authority and entirely outside the intent of his original creator.

This culminated in Pepe becoming accociated with and widly used by various extreamist political groups, prompting Matt Furie to use his copyright in an attempt to stop the character’s use. While Furie achieved some legal successes, the character ultimately had completly escaped his control. Pepe took on drawing styles and lore with no single author, he just continued evolving online, even morphing into versions so different from the original that they took on other names and identities.

The nature of the internet made containment impossible. In an interview with Esquire, Furie said of Pepe’s use as a hate symbol: “It sucks, but I can’t control it more than anyone can control frogs on the internet.”

In late April 2023, during a crypto bear market following the collapse of FTX, a PEPE memecoin was launched on Ethereum and quickly reached a market cap of 1.6 billion by early May. Today it has a market cap of 5.5 billion—down significantly from its all-time high of 11 billion in late 2024.

I was closely following the token at the time, and what I saw was a glimpse of crypto’s potential as a diffuse value capture system. The memecoin functioned as a minimal viable coordination and incentive mechanism layered on top of a diffuse cultural phenomenon.

Anyone holding the token could create content for it without permission, and if the content was good, the token would go up in value, like a basic attention market. It created an incentive structure for propogating the meme.

Crypto has a concept of “working for your bags”. In tradional wage labor a massive about of time is wasted simply trying to get the next job. But in crypto, you can buy an assets you think is undervalued without permission, and imediatly get to work promoting it.

This can be as simple as making memes and content on a site like Twitter/X, or can look more like a real job, such as buying a crypto token for some open-source technology or protocol and working to improve it on GitHub and talking about it on social media.

This is already something that happens with equities, people that own a lot of Apple stock tend to own Apple computers, and they are incentavized to promote them and ignore their flaws due to finacial intrest. Crypto allows this to happenin in a much more fine grained way.

In the early days of PEPE, almost every night there were long Twitter spaces full of 100s of people talking about PEPE. The energy was electric, hosts would sometimes just play Jungle music and everyone would spam green hearts. This was of couse all very juvinile and silly, but most interesting technology looks like that at first.

Blockchains currently have a lots of problems that prevent mainstream adoption, but I could see a future where Linux distros and open source software projects have crypto assets accociated with them.

Pepe layed the groundwork for a new generation of post-authorship projects—ones that didn’t just accidentally become diffuse internet memes, but were designed from the ground up to be that way. Projects like Milady, emerging from the alt-right Frog Twitter, were designed to be diffuse from the start. PFP NFTs Licensed under a copy left license, the project invited a kind of ARG-like game where anyone can make a derivative work without permission, and the PFP became a kind of license to have fun online that free wearers from the stifling preasures of identity. Where Pepe foreshadowed the loss of authorial control, Milady formalized it as a design principle.

8 Post-Authorship

The obsession with authorship and originality that results from an over-reliance on direct value capture has become a weight dragging down creativity, collaboration, production incentives, and mental health.

We’ve built a world where the path to success is to isolate, own, control, and defend infinitly copyable intangible ideas. This is not only at odds with how culture and technology actually evolve—it actively suppresses the social and memetic nature of cultural production.

Pay attention to design related social media and you will see an endless parade of people complainging about other people stealing their work, recently over things as trivial and obviously un-ownable as color gradiants. At the same time the quality of design in the everyday world degrades beacuse the presurses of direct value capture push designers to become expressive artist autures instead of visual systems engineers. So our visual environment degrades into expressive slop replaceing the dignaty and beauty of functional authorless late modernism.

The Satie graphic is just the font Ogg Regular with the i changed to Ogg Regular Italic, plus a little bit of tracking…https://t.co/XtOXnRN6jE https://t.co/i59g2tbP5P

— Eli Heuer (@eliheuer) November 30, 2023

The increased importance of identity politics, specifically in universities and professional-managerial class circles between the 2010s and 2020s has exacerbated the tendancy of dirrect value capture systems to over focus on identity and authorship. This has led to a lot of disfunction where identity almost becomes more important than actual work or productive outcomes. The Tiktok-ification of social media and the bifurcation of micro-blogging into seprate left and right echo chambers has only made this worse.

Near height of this increasingly disfunctional trend, the NFT PFP Milady was launched on Ethereum. This was a project that was designed to be diffuse from the start, licened under the VPL, a simple copyleft license that allows anyone to make a derivative work without permission, but also requires that derivative works be licensed under the same terms. The project invited a kind of ARG-like game where anyone can make and sell derivative NFT collections, and the PFP became a kind of license to have fun online that freed wearers from the stifling preasures of identity politions and authorship. The comunity encourged stealing tweets and wearing NFTs you didn’t own. Where Pepe foreshadowed the loss of authorial control, Milady formalized it as a design principle.

One of the key people behind the project was Charlotte Fang, An interesting figure who wrote many blog posts and tweeted art critisism at the time. He wrote a blogpost called “Unpacking Post-Authorship” in 2022 which formailized the idea of post-authorship as a new way of thinking about art and design after blockchain and AI. It offered an alternative to the increasigly stifling identity and authorship culture of millenial profesionals and legacy art and design institutions:

While the authorhip and indentity obsesed art and design world faught over scraps thown to them by legacy institutions, and endured low-pay, unpaid internships, and other forms of degradation, the Milady community was making money and having fun online. The NFTs reached a very high price, and unauthorized derivative works were being made and sold by the thousands. At one point Vitalik Buterin even wore a Milady NFT as his Twitter/X profile picture.

I’m interested in the idea of post-authorship and how it relates to the idea of free and open source software. Is it possible to use crypto incentives to build large scale collabrative open source projects that would not be possible with everyone persuing their own agendas of authorship and identity? The main thing holding back this kind of work is financial incentive as far as I can tell. Many programmers and designer and financially incentivised to work in corprate settings on large project they have little authorship over. What if we could partially recreate those incentives in permissionless independent open-source projects?

Outside of crypto an example I often use to illlustate this idea is open-source fonts. Designers selling proprietary fonts with complicated and expensive licensing. This direct value capture strategy leads to extreme beliefs about authorship and originality, when in reality, the design of fonts is extremely memetic and every design is a remix of other designs. A truly unique font design that isn’t built on a mountain of prior work and free and open-source software is almost impossible to find.

We have been in a transitional period for awhile now where open source fonts have been replacing propritary fonts. But the culture of authorship and originality is so ingrained the culture around font design that very few projects have embranced the colabrative and open nature of open source fonts and have focused on work that centers authorship and origionality.

Their design assumes memes = an individual viral post, eg a specific funny tik tok, rather than call & response remixed cultural virus, eg an evolving tik tok fad. Incredible millennial brainrot. They accidentally built a very poor, ultra thin prediction market on post engagement

— ♡ Charlotte Fang 🪲 Crown Prince ❀ LOVE HEALS 💞 (@CharlotteFang77) April 19, 2025

I belive there is a lot of potential in using crypto incentives and a post-authorship ethos attempt large scale opensource projects that were previously impossible.

9 Incentivizing Post-Authorship Commons-Based Peer Production.

Commons-based peer production, a term Yochai Benkler introduced in 2002, describes large, networked collaborative projects such as GNU/Linux, Ethereum, Wikipedia, and SETI@home. Commons-based projects generally have less rigid hierarchical structures than those under more traditional business models, but Benkler’s core insight is that commons-based production does not propagate proprietary knowledge. Everything created remains equally available for anyone to use, remix, and extend. To qualify as true peer production, the work must be not only open in its results but also decentralized in its process; participants coordinate through code, reputation, and shared purpose instead of line managers.

Digital goods push this model to its logical conclusion. Once the first copy of a program, video, or AI model exists, duplicating it costs almost nothing. Competitive pressures, piracy, and open-source alternatives drive prices toward that marginal cost, so the long-run price of much software is effectively free. In this environment, diffuse value capture—earning income from adjacent services, reputation, or downstream demand—often outperforms direct approaches like paywalls or DRM.

Successful 21st-century collaborations therefore treat openness as a design primitive, not an afterthought. Code, data, and imagery that are more valuable shared than hoarded are released early, and mechanisms such as tokens, quadratic funding, or protocol fees create an automatic feedback loop: anyone who strengthens the commons also shares in its upside. What begins as a gift quickly becomes self-sustaining because the network itself pays contributors to keep pushing the frontier forward.

Incentives are not abolished; they are rewired. The greatest rewards accrue to those who document clearly, localize patiently, remix creatively, and maintain faithfully—behaviors that expand the commons instead of enclosing it. When reputation and profit travel with a pseudonymous wallet, the old résumé hierarchy gives way to an open ledger of verifiable impact. Work speaks louder than claims of authorship, and no single maintainer can monopolize the surplus without the community’s consent.

Skeptics fear speculation will swamp real creation, yet experience with open protocols suggests the opposite. Minimal, tamper-proof rules—hard caps on token supply, automatic public-goods fees, timelocked founder stakes—keep value circulating toward builders who deliver. Bad projects still crash, but good ones persist, fork, and evolve long after any founding team could have sustained them alone. Failure becomes cheap information; success becomes public infrastructure.

The emerging landscape resembles a coral reef: countless small actors competing and cooperating at the edge while collectively building something vast, intricate, and durable. Fonts, research papers, model checkpoints, neighborhood mesh networks—anything whose marginal cost has collapsed—can flourish under this model. The question is no longer “How do we stop people from copying?” but “How do we help them copy better, faster, and in directions none of us could predict alone?”

The printing press took two and a half centuries to produce modern copyright. Blockchains and neural networks may need only a few decades to retire it. The rails for diffuse value capture are already in place; cultural norms are racing to catch up. Our task is simple: build things that cannot exist without a crowd, invite that crowd from day one, and let the upside flow wherever the work goes. In doing so we trade the brittle prestige of solitary authorship for the compounding power of shared creation—and finally return technology’s deflationary bounty to the people who generate it.

Commons-based peer production is a term coined in 2002 by Harvard Law School professor Yochai Benkler. It describes a model of socio-economic production in which large numbers of people work cooperatively; usually over the Internet. GNU/Linux, Ethereum, Wikipedia, and SETI@home, are all examples of commons-based peer production.

Commons-based projects generally have less rigid hierarchical structures than those under more traditional business models. In the case of a crypto memecoin or a proper DAO, there can be basicly no hierarchy outside of who owns more tokens and onchain history within the project.

According to Benkler, what distinguishes commons-based production is that it doesn’t rely upon or propagate proprietary knowledge: “The inputs and outputs of the process are shared, freely or conditionally, in an institutional form that leaves them equally available for all to use as they choose at their individual discretion.” To ensure that the knowledge generated is available for free use, commons-based projects are often shared under an open license.

Not all commons-based production necessarily qualifies as commons-based peer production. According to Benkler, peer production is defined not only by the openness of its outputs, but also by a decentralized, participant-driven working method of working.

In digital markets the marginal(additional) cost of producing the next unit often approaches zero. Once the first copy of a software package, video, or AI model exists, replicating it is basically free. Competitive forces, piracy, and open-source keep pushing selling prices toward that marginal cost, so the long-run price level for many goods is “free.”

When the price of digital goods aproches zero diffuse value capture becomes more effective than direct value capture. There are still incentives to produce the good if you have a diffuse net cast wide to capture value from adjacent products and services.

The future of large-scale collaboration will belong to projects that treat openness as a design primitive, not an after-thought. When the code, data, or imagery at the core of a project is more useful shared than hoarded, the fastest way to grow its value is to remove every barrier to participation. Tokens, quadratic funds, and other on-chain mechanisms simply create a feedback loop around that openness: anyone who improves the commons can also share in its upside, no résumé or gatekeeper required. What begins as a gift quickly becomes self-sustaining because the network itself pays contributors to keep pushing the frontier forward.

This shift does not abolish incentives; it rewires them. Instead of rewarding the person who can erect the tallest paywall, it rewards the person who can inspire the widest reuse. Influence accrues to those who document clearly, localise patiently, remix playfully, and maintain faithfully—behaviours that strengthen the commons rather than enclosing it. When reputation and upside travel with a pseudonymous wallet, the old drama of résumé hierarchy is replaced by a living ledger of verifiable impact. Work speaks louder than claims of authorship, and no single maintainer can capture the entire surplus without the community’s consent.

Critics worry that speculation will swamp real creation, yet the opposite is unfolding wherever open protocols take hold. Minimal, tamper-proof rules—hard caps on token supply, automatic fees to public-goods treasuries, timelocked founder stakes—have proven enough to keep value circulating toward builders who deliver. Bad projects still pump and crash, but good ones persist, fork, and evolve long after any original team could have kept them alive by sheer will. Failure becomes cheap information; success becomes a public utility.

The result is a landscape that looks less like corporate oligopoly and more like a coral reef: countless small organisms competing at the edge while collectively constructing something vast, intricate, and durable. Fonts, research papers, training checkpoints, neighbourhood mesh networks—anything whose marginal cost has collapsed to zero—can thrive under this model. The economic question is no longer “How do we stop people from copying?” but “How do we help them copy better, faster, and in directions none of us could predict alone?”

If the printing press needed two and a half centuries to birth copyright, the combination of blockchains and neural networks may need only a couple of decades to retire it. The rails for diffuse value capture are already live; cultural norms are racing to catch up. Our task now is simple: ship things that are impossible to build without a crowd, invite that crowd in on day one, and let the upside flow wherever the work goes. In doing so we trade the brittle prestige of solitary authorship for the compounding power of shared creation—and we finally give technology’s deflationary bounty back to the people who generate it.

Colophon

This post is typeset in Bezy Grotesk, a free and open-source font designed by Eli Heuer,the essays author. It is built on the authorless commons of the Internatinal Typographic Style and the work of many other designers, both known and unknown.