07.11 Decentralized Science (DeSci): Promises and Limitations of Blockchain Based Initiatives for Sustainable Value Creation in Academia

Aim of the project

The project has a descriptive and an explanatory aim. The descriptive aim consists in mapping the emerging organizational field of blockchain based Decentralized Science (DeSci) initiatives, in particular DAOs, and their interplay with established or Centralized Science (CeSci) organizations. The second aim is to investigate how variations in the institutional arrangements, including different modes of blockchain governance, of DeSci initiatives affect their capacity to foster sustainable cooperation and value creation within and between the organizations involved.

Theoretical background

The institutions governing the academic system are under pressure. Cut-throat competition for dwindling research funds, pervasiveness of precarious short-term contracts, a merciless publish-or-perish culture, and rising student-to-staff ratios causing endemic overwork are only some of the flaws that according to critics characterize modern Academia. These problems and the detrimental consequences for all involved stakeholders are well-known. Examples are funding institutions being overburdened with an overwhelming number of grant proposals to process; the peer-review system getting clogged; individual scientists entering an increasingly uncertain career path and an ever widening set of performance evaluation criteria. In The Netherlands during the past decade, calls for reform kept intensifying and were fueled both by grass root initiatives (like Science in Transition, a movement run by scientists) and more organized attempts launched by the leadership of Dutch Universities (like the Recognition and Reward framework for evaluating performance of scientific personnel). Many welcome these efforts as an effective first step towards correcting the excesses of an overheated but otherwise functional system of knowledge production. A small but growing group is more skeptical, considering the current system as such as not sustainable in the long run. For them, current reform initiatives remain futile attempts to treat the symptoms, rather than attacking the root cause of the problem. They claim that as long as the organization of science rests on highly centralized structures – dominated by coalitions of gatekeepers who decide who gets access to research funds, to publishing opportunities and to academic positions – the performance of the academic system as a whole will decline, and with it its valuableness to society. This group of stakeholders therefore advocates a more radical approach towards transformation. The Decentralized Science (DeSci) movement explores how blockchain technology can be used not only to solve some of the pressing issues of the current academic system, but also to fundamentally restructure it (Etzrodt, 2018; Ducrée et al, 2022; Wang et al, 2022). Blockchains are a relatively recent invention – the idea was proposed only in 2008 and popularized as their initial applications to cryptocurrencies in alt-finance gained momentum. Bitcoin, its competitors and a wide array of financial experiments slowly formed into what has become known as decentralized finance (DeFi), where many consider the related technology as a true game changer. Decentralized Science applications of blockchain technology are even more recent (Kosmarski, 2020). DeSci is part of the widening applications of blockchains, including to the Internet and knowledge governance in digital society as part of “the latest Web3 Movement” (Hamburg, 2022). The ambitions of this movement are high: “DeSci revolutionizes the structure, norms, incentives, and value allocation of centralized scientific systems….It uses digital tools for funding, organizing, training, planning, coordinating, dispatching, collecting, distributing of supply and demand activities, and resources in cyberspace-based communities. DeSci re-incentivizes the scientific ecosystem through token systems and decentralized power, and returning scientific value and ownership to knowledge producer” (Ding et al., 2022). More and more DeSci initiatives are now launched (Keck et al, 2020), and Decentralized Autonomous Organizations (DAOs) are a key tool to implement them (see e.g. https://ethereum.org/en/desci/). DeSci advocates embrace this new hybrid organizational form not only because it promises to enable “trustless” cooperation, but also because it may allow wiser evaluations, better incentivation and fairer recognition and reward of individual contributions. DeSci DAOs have been launched for almost all facets of academia, ranging from funding to community building to peer review to reputation systems. However, so far we lack a systematic inventory of the initiatives, their core assumptions, ambitions, strategies and progress as a new element of the current academic system and its organizations. This project therefore heeds the recent call for mapping this emerging organizational field and assess under which conditions and how DeSci DAOs succeed in sustaining value creation in science, and which obstacles they may face: “A thorough review of the DeSci landscape and its implications would promote open discussion on the impact of these new technologies on scientific research.” (Hamburg, 2021). Theory Decentralized Science initiatives are relatively recent, and so is theorizing about it. DeSci can be analyzed from a variety of theoretical angles, since it contains aspects of a professional (social) movement, reflects the emergence of a new organizational field (Wooten & Hofmann, 2008; Zietsma & Lawrence, 2010), implies the (de-)institutionalization of deeply engrained established practices (Dacin & Dacin, 2008) and the required processes of frame restructuration (Kim, 2021), and aspires the institutionalization of new forms of governing multi-institutional interdisciplinary research collaborations (Corley et al., 2006) through establishing blockchain networks as polycentric orders (Alston et al., 2022). Though none of these theoretical frameworks so far have touched upon the opportunities and challenges related to blockchain governance, they provide useful pointers to answer the question under which conditions blockchain governance can foster the sustainability of decentralized science organizations and collaborations. For example, Corley et al. (2006) argued that for large-scale, multi-discipline, inter-institutional collaborations to succeed, they need to achieve a high level of refinement either in the epistemic development of the involved disciplines, or of the organizational structure of the collaboration. Drawing on material from two case studies, they propose and show that it is the domain (epistemic vs. organizational) with the highest level of institutionalization that organizes the rules of the cooperation. Studying the development of alternative forms of organization in the face of crises, Kim (2021) makes a strong case for the necessity of developing effective new diagnostic and prognostic cognitive frames replacing established ones that prove increasingly dysfunctional. More generally, these accounts share a concern for the dynamics affecting multiple dimensions of institutional strength. The Theory of Institutional Strength (Hindriks, 2022) allows to integrate these perspectives and serves as a point of departure for this project. Conceiving institutions as norm governed social practices, this approach argues that the strength of institutions is a function of either the degree of compliance to coordination rules that solve problems of information, or of the weight attributed to the cooperation rules that solve problems of motivation. The project will further elaborate the institutional strength approach and apply it to the new realm of Blockchain Governance of the organizational field of DeSci DAOs and their multi-stakeholder relations.

Research design

A mixed method approach will be used to empirically investigate the nascent organizational field of Decentralized Science and the organizations involved in it. A first step consists in mapping Blockchain or Web3 Based Decentralized Science Initiatives and eliciting documents and communications about their institutional arrangements and governance principles, including how these have changed so far. We then follow the empirical strategy developed by Herzog et al. (2022). This empirical strategy collects two types of data. First, it identifies the relevant organizational actors that are part of the organizational field. Exploratory interviews with experts will be used for this mapping exercise. In a second step, documents (e.g. white papers, internal memos) and in-depth interviews with representatives of these organizations will be used to reconstruct the institutional grammar underlying the envisioned DeSci arrangements that are supposed to govern scientific practice in different domains. Coding will follow the procedure elaborated in the Institutional Grammar Tool (IGT, (Bushouse et al, 2021), which allows a fine grained systematic mapping of (changes in) rule systems, including their implications for prescribed interactions. It identifies six components (ibid): “(1) the Attribute which is the actor who is to carry out the rule; (2) the Deontic which identifies whether the action is required, permitted, or forbidden; (3) the aim which specifies the action; (4) Conditions which further specify or limit the aim; conditions typically specify how, when, or where the action is to be taken; (5) Or else, which specifies the penalty for not taking the action; and (6) the object which is the receiver of the action”. The second step consists of a sociometric survey mapping de perceived interactions between stakeholders within and between involved organizations in different domains. During this step, perceived collaborative network structures (rules in use, including perceived interactions) will be elicited. A sociometric survey will be sent to key representatives of the identified organizations. This survey will elicit collaborative relations (e.g. for inter-organizational interactions: “with which organizations has your organization been closely collaborating within the domain of [x] during the past six months”. Respondents will also be asked to indicate which policy instruments, in their view, could improve practices in specific science domains. Also their policy core beliefs will be elicited, i.e. “general principles actors want to see implemented” (Herzog et al., 2022:373) regarding a specific domain (e.g. social justice, competition).