Working Paper by Jason Potts, Ellie Rennie and Jake Goldenfein
Abstract: The Smart City agenda of integrating ICT and Internet of Things (IoT) informatic infrastructure to improve the efficiency and adaptability of city governance has been shaping urban development policy for more than a decade now. A smart city has more data, gathered though new and better technology, delivering higher quality city services. In this paper, we explore how blockchain technology could shift the Smart City agenda by altering transaction costs with implications for the coordination of infrastructures and resources. Like the Smart City the Crypto City utilizes data informatics, but can be coordinated through distributed rather than centralized systems. The data infrastructure of the Crypto-City can enable civil society to run local public goods, and facilitate economic and social entrepreneurship. Drawing on economic theory of transaction costs, the paper sets out an explanatory framework for understanding the kinds of new governance mechanisms that may emerge in conjunction with automated systems, including the challenges that blockchain poses for cities.