The Crypto-Anarchists

by Brian Zuzga
as part of the requirements for 6.095

Hey! Anarchists, Don't They Throw Bombs?

I deemed it necessary to put this caveat at the beginning to try to clear up any popular misconceptions that readers might have about anarchism. For the most part, anarchists are not violent and do not throw bombs. In fact, their goal is quite the opposite: do away with government to promote a more peaceful world.

ANARCHISM -- The philosophy of a new social order based on liberty unrestricted by man-made law; the theory that all forms of government rest on violence, and are therefore wrong and harmful, as well as unnecessary.

-Goldman (Anarchism and Other Essays, p. 50)


It is difficult to ascribe to governments any capacity for order and social harmony. Order derived through submission and maintained by terror is not much of a safe guaranty; yet that is the only "order" that governments have ever maintained. True social harmony grows naturally out of solidarity of interests.

-Emma Goldman (Anarchism and Other Essays, p. 59)

If the collective is weakened and the individual strengthened by the fact that I have the power of cheap guns, cars, computers, telecoms, and crypto then the collective has been weakened and we should ease the transition to a society based on voluntary rather than coerced interaction.

-Duncan Frissell (original source unknown)

The above quotations bear a surprising similarity to each other, which is remarkable considering the fact that they were written almost a century apart by people in completely different circumstances. The first quote was written by Emma Goldman (1869-1940), an anarchist in the old tradition, while the later one was written by a Cypherpunk. It is this similarity that is fascinating, and this paper will compare the philosophies of the Crypto-Anarchists with those of the "traditional" anarchists. In particular, this paper will discuss where the Crypto-Anarchists have departed from mainstream anarchist thinking.

What is a Crypto-Anarchist?

The Crypto-Anarchists espouse the belief that strong cryptography will finally demonstrate that authoritarian governments are unsustainable. In their vision it will be impossible for governments to collect taxes and exercise any authority in a world where a great number of transactions are totally anonymous and completely secure.

National borders are just speed bumps on the information superhighway.

-May (from his .signature file in July 1994 on

In particular, the notion that a government is associated with a certain geographic area is outdated. With the advent of high-bandwidth telecommunications, it is possible for people on different continents to conduct daily business transactions. When a nation's boundaries become a meaningless concept, won't the concept of a national government soon follow?

As a result of this revolution, the Crypto-Anarchists also predict the coming of many abhorrent markets, such as assassination markets, wide-spread money laundering, risk-free espionage, and other sundry forms of organized crime. These are the risks in this "brave new world" and are the consequences that must be dealt with when the time comes.

To date, the crypto-anarchists are mostly a subset of the Cypherpunks, an orgazation that has existed since late 1992. The Cypherpunks have a great interest in promoting the use of anonymous remailers, encryption tools, and digital cash. They generally have a libertarian political bent to their discussions. The movement has mostly a practical focus of encouraging the use of these technologies and is not solely political in nature. It would be a mistake to assume that any particular Cypherpunk is a crypto-anarchist. In fact, most of the reflections on crypto-anarchy in this paper come from Timothy May's prolific work titled "The Cyphernomicon." Since there is a profound lack of coherent source material in the field of crypto-anarchy it would be very easy to attribute May's views to all crypto-anarchists, even when doing so would not be approriate (since May is the most visible crypto-anarchist). Unfortunately, this is not too uncommon with small anarchist movements, much like Michael Bakunin's individualist anarchist movement where the few short essays that he wrote were very difficult to understand.

None of the above sounds particularly like anarchy, except in the popular usage of the term. So, how can the Crypto-Anarchists claim to be anarchists at all? Deeper examination of their views may show some more similarities and differences. This paper will investigate the current Crypto-Anarchist literature and try to compare it to the traditional anarchist literature as a reference.

Individual Rights

It is intriguing how the Crypto-Anarchists emphasize the individual rights side of their philosophy. This is an important distinction from the traditional anarchist philosophers, even if it is just a backlash to the current state of affairs. They propose that the involvement of a third party in what should essentially be a two party transaction is a nuisance at best. There isn't much more discussion on exactly what an individual's rights are, but they are specific when they say that technology and not government will secure those rights. An individual's rights are protected by the laws of mathematics under crypto-anarchy, not the laws of man.

Petr Kropotkin (1842-1921), a Russian scientist and probably the best known anarchist thinker, stresses that when people are left to their own devices they form communities of mutual-aid. He provides countless examples from nature that show animals helping each other in surprising ways (he was a scientist first, a political thinker second). He goes on to talk about rural peasants helping each other spontaneously and how the state tries to crush this mutual assistance, but it perseveres. All in all, Kropotkin stresses that authoritarian systems aren't feasible because they aren't natural, and that nature operates quite successfully using the principles of anarchy.

There is little difference between the two philosophies on this point. They both state that individual rights are more "natural," whether it be human nature or the nature of mathematics. However, Kropotkin isn't against limitations on personal freedom that are entered into freely and can be terminated at any time; but the impression given by the crypto-anarchist literature is that they would take steps to overcome any limitation to their freedom.

Advantages of Anarchy

The crypto-anarchists are quick to mention that the Internet is an international effort to encourage free communication that happens to be run in a non-authoritarian manner. Some are also quick to point out that this is a novel concept. However, it is important to note that many other international systems on a grand scale are also run in the same fashion. The example that the traditional anarchists always point out is that the mail system (snail mail for you technophiles) is run completely by consensus. There is an organization of all the mail services of all the nations in the world, and they have agreed that they will freely exchange mail between each other. [It is important to note that governments abiding by the agreement are still permitted to detain and inspect mail destined for points within their borders. The agreement just states that mail flowing from country A to country B through country C will actually make it.]

So, the concept of non-authoritarian governance on the Internet isn't such a novel idea after all. However, maybe the "granularity" of it is, because it operates on the level of the individual. While there are countless examples of non-authoritarian systems that operate internationally, they are rarely focused on the individual. The Internet has the possibility to give one complete control over one's communications and transactions, without any unnecessary third party involvement (with the use of cryptography and steganography). So, the crypto-anarchists may be right on target by accenting the individual. [Their method of enforcement of rights is by technology, rather than law or reason. This is a very novel concept.]

The Crypto-Anarchists stress how the idea of the state is obsolete with the existence of global networks, and how governments just get in the way. They do not stress any positive social aspects of increased individualism. In fact, they seem to stress the anti-social aspects entirely, namely profiteering and so-called abhorrent markets.

The traditional anarchists stress a very different side of anarchy. They don't see it as an inevitable consequence of advancing technology, they see it as the natural state of human affairs and that the state is something unnatural that has been imposed upon us. The traditionalists see anarchism as a return to our roots, a more natural way of living.

The crypto-anarchists say that an increasing number of economic transactions will take place in cyberspace, and it will slowly creep into people's lives. On the other hand they also say that if you don't like what is going on in cyberspace, then you don't have to participate. More over, you can participate in cyberspace communities that you agree with, which is much different than the current state of affairs where geography forces us to interact with people that we'd rather not interact with. This is completely consistent with anarchist philosophy. The crypto-anarchist approach even solves the technical problem of how one would make truely free-associations practical, as opposed to defaulting to geographically forced associations as in the pre-information age world.

The crypto-anarchist views may be traced back to their technical and libertarian roots. Most of the crypto-anarchists are technologically knowledgeable, and have ties with the mostly libertarian movement of the Cypherpunks. The traditional anarchists were mostly scientists and well-educated people of the late 19th century. They weren't as technologically oriented as those of the present, and only had natural systems to make analogies with. Now we can make analogies with mechanical and electronic systems.

The Evils of Nationalist Governments

One single war -- we all know -- may be productive of more evil, immediate, and subsequent, than hundreds of years of the unchecked mutual-aid principle may be productive of good.

-Kropotkin (Mutual Aid, p. 296)

However, things are already pretty bad. Look at Bosnia, Ruanda[sp], and a hundred other hellholes and flash-points around the world. Look at the nuclear arsenals of the superpowers, and look at who starts the wars. In nearly all cases, statism is to blame. States have killed a hundred million or more people in this century alone--think of Hitler, Stalin, Mao, and Pol Pot--through forced starvation of entire provinces, liquidation of the peasantry, killing of intellectuals, and mass exterminations of religious and ethnic groups. It's hard to imagine crypto anarchy causing anything that bad!

-May (The Cyphernomicon)

Anarchist and Crypto-anarchist alike are opposed to nationalist governments. The coercion, misinformation, and organizational inertia of statist government are all against the principle of free associations that can be broken at any time. They both stress that with increased individual liberties, some may use these new found freedoms to antagonize their fellow man. However, they both also point out that a few anti-social individuals are better than organized and institutionalized oppression by many more under the guise of government. So, the two agree almost completely on this point.

One of the most pointed criticisms of the nationalist government is that it depends on the trust of its citizens; however, rarely do (or even can) they prove that they are deserving of that trust. It is a common idea throughout the anarchist, crypto-anarchist, and even libertarian literature that we should trust the government as little as possible, and that they should be able to prove that they are trustworthy at every opportunity possible. Here it appears that many philosophies agree in word and spirit.

The crypto-anarchists see their system as a return to the 4th amendment protections and privacy that was enjoyed by previous generations. In particular, they see this as an opportunity to protect the privacy of electronic assets which have come under much scrutiny by the government lately. It wasn't previously possible to freeze all of one's assets instantly if you suspect them of a crime, but that is becoming increasingly the case these days. They see this as a bad thing.

The two philosophies seem to be completely in agreement regarding the evils of a nationalist government. This is not suprising, since nationalist governments are often the scapegoat for many political thinkers.

The Ultimate Failure of Democracy

The founders of our country never intended for every citizen to vote on every issue; a direct democracy was never desirable to them. With the arrival of the information age, the Crypto-anarchists indicate that a direct "electronic" democracy is practical (a la Max Headroom), but definitely not desirable.

Why is direct democracy so undesirable to the crypto-anarchists? Surely it is fair and open. It gives every citizen one vote on any issue that is brought before them, and everything is decided by a simple majority. However, this is what the crypto-anarchists call "mob rule at its worst." (May, section 4.12.2) They imply that the average citizen doesn't have the knowledge, education, or the time to make rational decision on the myriad of issues that are brought before Congress on a daily basis. The majority may also enact laws that are truly harmful to large minorities, and which would prove detrimental in the long run. (May, section 16.5.2)

While the traditional anarchists never saw the direct democracy as a potential threat, they were equally as critical of what they called "the tyranny of the majority." Emma Goldman puts it best:

If I were to give a summary of the tendency of our times, I would say, Quantity. The multitude, the mass spirit, dominates everywhere, destroying quality. Our entire life -- production, politics, and education -- rests on quantity, on numbers.

-Goldman (Anarchism and Other Essays, p. 69)

The crypto-anarchists indicate that De Toqueville warned us early on that even the representative democracy would fail once the citizens discovered that they "could pick the pockets of their neighbors at the ballot box." That is voting in politicians would bring back pork to their constituency at the expense of other regions of the country, and it's this lack of concern for the greater community that is harmful.

The crypto-anarchists see the coming cyberspace and cryptographic revolution as a way of bypassing the moral majority and "taking... decisions out of the hands of the bluenoses." That technology will finally provide ultimate protection for speech and informational transactions.

This point of view is slightly different from the traditional anarchist point of view where the community can impose some restrictions, but these restrictions are freely accepted and are lifted when one leaves the community. It is interesting to wonder what Bakunin, Kropotkin, and Goldman would have thought of the cryptographic revolution; however, one can not begin to fathom their conclusions. [The changes in technology from the time of the traditional writings has been so phenomenal that it's difficult to even make analogies with a lot of their examples, which mainly deal with agriculture and assembly lines.]

The Value of Work

Work and the planning of the economy is always an issue where even the traditional anarchists cannot agree, so it's difficult to even say whether the crypto-anarchists agree or disagree with the traditional philosophies. A survey description will have to suffice.

Anarchists range from the communitarian variety, to the capitalist variety, to the individualistic variety. The communitarians have a socialist view of the economy, but on a much smaller scale where there are communities of individuals who participate freely as a member of the social, political, and economic systems of their community and can leave at any time. The capitalists have more of a corporate view of their ideal economy, where markets and reputations decide the balance of power. Lastly, it is difficult to fathom the motives of the individualistic anarchists, since they are usually just well-armed paranoid hermits, as far as anyone can tell.

The crypto-anarchists are most probably of a capitalistic bent. This may be a blatant misrepresentation of the truth, but there is a very limited amount of material that defines itself as "crypto-anarchistic."

There are a number of ways that the crypto-anarchists propose the use of a capitalistic system: information markets, the prediction of so-called "abhorrent" markets, anonymous transactions, digital cash, and digital signatures on contracts. All of the above are irrelevant if one is using the plan of the communitarian markets with their "smaller is better" approach. The crypto-anarchists propose a monolithic world-wide free market that exists only in cyberspace for facilitating the exchange of informational assets, the sale of physical goods, and all variety of services.

The communitarians would have many criticisms of this capitalistic approach. One of the issues that concerned Kropotkin so greatly was that of the value of labor; Emma Goldman's previous complaint about the evils of quantity as opposed to quality, is also relevant. The communitarians stressed that mass production has taken away the value of labor from the worker. In days gone past a laborer had to have a skill that was useful in and of itself to become a marketable worker; while with the advent of the assembly line the worker no longer knows how to do anything but their small part in some giant machine. Hence, an auto worker knows nothing about how a car works, and certainly doesn't know enough to build a better one.

To relate this to the issues of the information age: the monolithic free-market could create a great many assembly line jobs of the future. A great many people will probably be employed performing the menial tasks of indexing and sorting written text into categories. It is already possible to get paid $0.60/article for reading Usenet articles and then assigning keywords to them (according to popular rumor). One could argue that summarizing thousands of human interest articles for news services around the world isn't an inherently useful skill, and is quite menial in nature. So, is this the trend of things to come? Is the intellectual assembly like the promise of crypto-anarchy?

A second criticism of the global economy that the communitarians would use is that smaller is better. A good communitarian would stress that smaller communities with a greater isolation from each other are more likely to weather tough times, more "fault tolerant" if you will. Some communities may flourish while others wither, the overall happiness will be greater than if the whole world is either flourishing or withering (a very utilitarian argument). A global economy could be a very chaotic and fragile beast, and this is an issue that the crypto-anarchists never address.

Finally, the communitarians would stress that diversity is progress. The danger of a global community is that people all around the world may begin thinking alike. Then innovation will slow, and people will get stuck into a very narrow mind set. The ultimate goal of the communitarians is usually progress. More people thinking in more diverse ways will lead to more innovative solutions to the world's problems.

The communitarian viewpoint brings up a number of hard issues that the crypto-anarchists fail to address adequately. The crypto-anarchists are still young, so there is certainly time to patch up these holes.

Intellectual Property

It is curious that the traditional anarchist literature also approached the issue of intellectual property, which showed a great deal of foresight (considering that most of it predates most of modern copyright law). The traditionalists hold the view that the inventor or creator of intellectual property holds the right to it. The problem is when someone tries to exploit that idea or invention in a capitalist manner. [In fact, they say that if a person invents an idea while working under a contract to produce that idea, the idea still belongs to the creator. Otherwise, the employer is just stealing the idea.] This concept may be a little outdated with the advent of cyberspace, where there is no practical physical manifestation of any of its contents; all there is is information. (Goldman, p 70-71 touches this topic in a different context)

The crypto-anarchists were vague on the issue of intellectual property. They acknowledged that both information and ideas would be the backbone of a lot of the transactions in the cyberspace of the future. However, they also made mention to how the current systems of intellectual property law are outdated and infeasible.

One can take the hard line and say that there is no such thing as intellectual property, and that would be a philosophically consistent system. However, it would also preclude a capitalistic system, which it seems that the crypto-anarchists are promoting. It would also be a system that would encourage people not to disclose their work, and that would be detrimental to the community at large. Maybe the only feasible system is the one of days gone by where an composer could be commissioned to write a song. The song once written is still property of the composer to sell and play as he/she wishes, and the privilege of the patron is to criticize the work and to be the first to hear it.

For instance, if a new air-traffic control system needed to be developed, a group of air traffic controllers could form a syndicate. The syndicate would hire a programmer to write the software to their specifications. Any one else wanting the software would have to pay money, and join the syndicate; since possession of the software is almost useless without the support. This would probably produce better software since the software engineers would have to listen directly to their customer's needs; while the current approach seems to separate the customer from the development process.

Mutual Aid vs. The Welfare State

Timothy May, the most visible crypto-anarchist, stresses that the bloated socialist welfare state is going to fall, and that a dog-eat-dog free market will emerge. However, to him this is a small price to pay to eradicate the nationalism which has caused so many deaths. In the crypto-anarchist view welfare is a foreign concept. They were very unclear in dealing with (or just completely ignored) the problems of educating our youth, the disabled, orphans, and other functions that we consider necessary in a "civilized" nation. Under this new order, altruism is almost forgotten; and the norm is fierce competition.

The traditional anarchists note that this is often what turns people off to non-authoritarian schemes. Hobbes always equated the state of nature to a state of war of all against all, which Kropotkin would say is untrue. They both argue that their views are correct and are a product of human nature [the last resort of arguments with no evidence]. Kropotkin uses examples from nature of how socially beneficial characteristics are hardwired into many animals, and humans are no exception. He goes on to talk further about how the state works against these tendencies of what he calls "mutual aid" and how this natural altruism still shines through:

When we examine the every-day life of the rural populations of Europe, we find that, notwithstanding all that has been done in modern States for the destruction of the village community, the life of the peasants remains honeycombed with habits and customs of mutual aid and support; that important vestiges of the communal possession of the soil are still retained; and that, as soon as the legal obstacles to rural association were lately removed, a network of free unions for all sorts of economical purposes rapidly spread among the peasants -- the tendency of this young movement being to reconstitute some sort of union similar to the village community of old. Such being the conclusions arrived at in the preceding chapter, we have now to consider, what institutions for mutual support can be found at the present time amongst the industrial populations.

-Kropotkin (Mutual Aid, p. 262)

These principles of mutual aid have carried over to cyberspace. People do form communities on Usenet news groups and mailing lists to deal with a wide range of problems, from software bugs to child rearing. Entire products exist, like Linux, which Byte magazine called "anarchy at its best."

Such efforts may be compared with the English life boat associations, which would rescue drowning sailors during terrible storms. These associations were made up of unpaid volunteers. When they were asked why they risked their own lives, they replied that they just couldn't stand still when they heard the cries from the drowning sailors. (Kropotkin, Mutual Aid, p 275-6)

In summary, the author of this paper may have misinterpreted the writings of the crypto-anarchists, but very little of it seems to stress the spontaneous formation of communities to help each other. At the very least this concept is greatly under emphasized. It leaves one with this hollow feeling that anarchy is a scary state of affairs. They stress the libertarian point of view that the welfare state is a bloated entity that must go away, maybe they stress that point too much at the expense of advocating any sort of community. This is in stark contrast with the traditional anarchists who want to promote an increased sense of community.

Breakdown of Anarchical Systems

A topic that neither the traditionalist nor the crypto-anarchist literature touches is that of maintaining a non-authoritarian system. They both go into detail describing a great new system and how it will be so much better than our current government, but they fail to deal with failure. How do anarchical systems fail? How does one deal with apathy which is the bane of any novel system?

One of the most common modes of failure is that of failing to plan for success. This was the case with the plywood cooperatives of the Pacific Northwest. They developed a system that worked very well but was unable to continue because of its success.

To elaborate, the plywood cooperatives were set up in the classic style of any cooperative; each worker in the cooperative owned a share of the company as a whole and had one vote. The management of the cooperative was hired labor, and had to answer to the workers. [A rather odd situation where the boss is giving orders to his boss. Many people found this very awkward at first, but found it completely natural after a little experience.] This system worked so well that the shares in the cooperative had appreciated by as much as a 1000%-5000%, and the original workers had a very comfortable retirement to look forward to. When it came time to sell the shares, they discovered that there was no one to sell the shares to. No one had the $50k to buy in to the cooperative. They thought of splitting the larger shares into "second-class" shares, but they felt that this destroyed the egalitarian nature of the cooperative. Eventually the only thing they could do was to sell these shares to capitalists, who eventually buy up a controlling interest in the company. Then you are once again left with a purely capitalist system, where one person holds all the cards.

So, how do we prevent someone, in a anarcho-capitalist system proposed by the crypto-anarchists, from "taking over the world?" What's to prevent the next Bill Gates from taking economic control of a whole field, and declaring themselves leader? That is not an issue that anyone addresses. [Except for Bakunin, who would just instigate another revolution.] The only solution that the crypto-anarchists propose is assassination. Secondly, how do anarchies deal with apathy? With so few people voting these days, it appears that no one cares about their country. Anarchies depend on the participation of the citizens. If people think it's easier to live under a despot and watch television, rather than spend an hour a day making real political decisions, then we will probably end up with a police state. This is another issue that the anarchists fail to deal with adequately. Here it seems that the traditionalists and the crypto-anarchists are in complete agreement. The only way to deal with fascists is violence, and we'd rather not think about apathy (being apathetic about apathy).