Mar 12, 202118 min read

A practical guide to building a country on the internet

Building a country on the internet is one of those ideas that people almost always get interested in when I mention it. For some reason, the idea has a lot of charisma.

But what does a country on the internet mean?

In short, a country on the internet means that a virtual entity provides most of the functions that you today would get from a nation state.

But more deeply, what it really means is that there is the possibility of making a much better life for everyone. To help ensure freedom and equal opportunities for all the fine people on this good earth.

So, how can someone make a country on the internet?

A good place to start is to see what the current criteria are for establishing a new country.

1. It has borders

This is a tough one for a virtual country. Perhaps the definition can be stretched to include a membership in place of a border. Or perhaps just have a small physical piece of land, like an embassy. Or perhaps you should short-cut the whole process by partnering with some futuristically minded existing micro-nation.

2. It is recognized by other countries as a sovereign state

This can be done the hard way, by getting other countries to support it.

But it can also be achieved by the mentioned method of cooperating with one of the many already recognized micro-nations, or progressive small countries. Provided you can pull it off legally, what would a country need to be substantively to be seen as one? I’d propose this:

3. An institution that solves shared common problems of participating individuals, particularly in regard to public goods problems

We can call this the functional requirement of making a country. Since you’re making a country on the internet and not a normal country, you’d have a lot of different constraints than normal countries. Firstly you’d have to get citizens voluntarily, which means it should be a lot better than any of the current alternatives. And secondly, you’ll need to co-exist peacefully with existing landholding countries.

In order to start imagining what your country on the internet might be like, it is worth learning what historical requirements there are for countries to exist, so you don’t make any mistakes we already know about.

Nation state

Nation states as we now know them came to be as late as the 1600s. This is hard to even imagine since they feel so permanent and fundamental. They were built on the idea that “a people” should govern itself. This feels quite obsolete today since they’ve changed dramatically over the last 200 years, mostly growing in size and becoming more stable. After the American Revolution, they also became less ethnically based and more democratic.

I found two good reasons why countries didn’t exist before they started existing:

Agriculture Before agriculture, people didn’t have the surplus needed to pay for the admin of running a civilization or a country. With agriculture, people were sort of forced into living stationary lives, with many of the problems which come with that (like the fact that you’re an easy target for “tax Collectors”). Lesson: How people make money is a key constraint for what social organization is possible. Remote workers and digital nomads are economically freed again to move around and live closer to the nomadic past we’re adapted to, so it should work for them.

Violence Empires of that past didn’t seem to primarily exist to be some communal problem-solving mechanism. It looks at least, for a layman like me, that those with the biggest armies threatened people so that they would have to give them stuff in exchange for not killing them. The best example of this is the Mongols, which didn’t seem to do much except raid and demand tribute. But people won’t give stuff unless the threat is credible. A measure of this is how easy it is for the few to win over the many in a battle. This is decided by the balance of offensive and defensive technologies at various points in history. In medieval times, knights ruled the land because a regular peasant didn’t stand a chance in direct battle. Then, the gun was invented. A peasant with a gun is about as lethal as an aristocrat with one, so the balance shifted in favor of the individual away from the state. Then bigger guns were invented, and now an army with machine guns (and later bombs) could take on a lot of peasants with guns and gave the state a massive advantage. That brings us up to the twentieth century. Lesson: If someone can just take your citizens’ things with bigger-army-diplomacy, it’s not going to last. So make sure your citizens have adequate defensive technology.

Concept: The logic of violence in the 21st century

With the internet and encryption, it’s become a lot harder to steal things, even if you have all the bombs. Just imagine how weird it is that people can transact anonymously to sell illegal goods in one country, and that country then can’t get the money back even though they can watch the transaction publicly. Or think about how hard it would be to decide who should tax a permanent digital nomad who works in a remote company.

For the first time, the logic of violence seems turned on its head. It has become harder to steal things than it is to prevent them from being stolen.

The logical conclusion if this is true (and yes, I do realize there’s a lot of huge-if-true in this), is that social organizations based on voluntary participation will be more competitive, because it’s too hard to take things by force.

Okay, so let’s say you now buy into the idea that maybe the first country on the internet will emerge in this century. You think the fundamental requirements to make a country on the internet can be met. Would it be good or bad?

Or put differently, why would a country on the internet be worth making? Five possible justifications are:

1. Geographical borders are obsolete and impractical

The internet has removed the role of the geographical border, but it’s still there as far as countries are concerned. Cheap air travel and remote work have made people increasingly mobile, but they still have to deal with the problem that they can’t take their country’s services with them abroad. Also, I just don’t understand why my friend Kojo who works remotely, grew up on the internet and speaks perfect English, can only travel to 2 or 3 countries freely because he happened to be born in Ghana.

Not to mention the practical difficulty of hiring across borders, where you can’t access any social safety net and you have unclear legal security.

2. A lot of countries are really bad

This is easy to forget for those of us who live in a country that is somewhat good, or at least feels sort of acceptable. But a lot of countries are really awful. They provide next to zero services in return for taxes and are led by incompetent leaders who insist on telling people what to do, in detail, all the time. Other countries are so corrupt, they have few resources left to solve common problems. In practice, these systems exist more as a mechanism for particular people to enrich themselves than a common problem-solving one.

People in these countries usually know this. But what can they do? Not much. This is bad, because people often have a lot of problems that are really hard to solve without a good country.

So for all these people who live in countries controlled by terrible governments, wouldn’t it be great if you had an exit-option? That hope may lie in a country that provides you with all the services your original country should have offered. Services that function well at an affordable cost.

3. People want to have a tribe, but don’t have one

Before agriculture, human beings lived in nomadic tribes. People tend to think of the reason to be in a tribe as being something like having people to talk to. But that’s more of a bonus benefit. You mostly had a tribe to solve common problems, like the problem of dying if you got sick or injured.

For a while nation states felt like they supplied both the identity and social safety net of the tribe. But now both these functions are falling apart, even in the most well-functioning societies. Have you noticed? This is extra true for digital nomads, who certainly can’t access a social safety net since they live abroad, but also move often and uproot networks. It’s also true for a lot of people living completely disconnected, alone in apartments in big cities, working as freelancers, or remote workers who fall between the cracks of the existing national systems. A lot of us just don’t have a tribe anymore, in any meaning of the word.

The tribe of the future has to solve shared problems and work for people who work remotely and live nomadically.

4. New technology opens up the possibility to make a lot better countries

We can easily organize now in large groups of people to solve common problems using the internet and computers. Many of the biggest hits on the internet, like Reddit and Wikipedia, are examples of this.

How bizarre would it be if these profound technologies like software and the internet happened — which disrupted pretty much every industry on earth — without any change in the landscape of governments? It’s almost absurd to think this wouldn’t alter the modern structure of governments.

Some of these technologies are already working well and ready to be implemented to make countries a lot better. And there are many others. It’s hard to say exactly how they might be better before someone tries, but at least we can confidently say that the potential for improvement is large.

5. Innovation and competition in citizenship would be good for people

Private monopolies usually don’t last long. Microsoft Office had a pretty comfortable monopoly until Google Suite became good enough to take it on. The threat of switching keeps companies on their toes to improve their products. And you don’t even need a revolution to switch, just cancel your subscription and get the better one.

But with countries and other monopolies protected by law, it seems like it’s possible to fully ignore your users forever.

If you believe that this sort of ability to exit and entrepreneur something better helps innovate, then it’d be fair to assume that countries have been less innovative than they could have been. After all, they’re stable monopolies, and both exit and entrepreneurship are usually illegal (although there are some legitimate examples of more enlightened policy in this regard).

A new era where countries, both offline and online, start to compete for citizens, will hopefully lead to better services for their inhabitants on average. Even from existing countries, which would need to up their game to prevent people from leaving.

In summary: What would your successful country on the internet need to look like?

If we go through the checklist:

It would need some kind of border or membership recognized by other countries. Or piggyback on existing small countries.
It would need to solve shared problems for its citizens (and solve them well), in particular, public goods areas.
It should be global in order to function well for remote workers and digital nomads.
It should use encryption to protect its citizens from theft and exploitation by bad actors.
It should offer the benefits of a tribe, like a social safety net (health, pensions, income protection, etc.)
It should provide a legal framework that works across territories with varying rules
It should make use of software and the internet, and be made for continuous improvement
And it should aim to be at least ten times better than existing alternatives

Why are we, specifically, talking about this?

SafetyWing is sort of based on the assumption that the reasoning above is mostly true. What is the biggest part of the budget of countries today?

Across all of them, the answer is the social safety net: health, pensions and income protection. We further concluded that the best way to build this is to make one product at a time to bootstrap our way to a global social safety net. We started with health (Nomad Insurance & Remote Health product), we are preparing to launch remote retirement this year, then membership and income protection — as a replacement for national welfare systems.

When we’ve built the first global social safety net, I’d say we would be in a good position to at least contribute significantly to a joint effort. We would function as the modern nomadic tribe, giving members the safety of having someone that won’t leave them behind, no matter where they are in the world.

With this approach, if we fail to reach the ideal end-state, we would still have built something useful.

This is an invitation

It’s time to stop obsessing over the obsolete old, and instead, start building the new.

Over the coming year, we want to get people like you to imagine what the first country on the internet might ideally look like. If you are working on a related project we should know about, tweet us @safetywing or apply for initiatives like Plumia - a community of remote leaders shaping the future of tomorrow that we are a part of.

There are so many problems to solve for digital nomads and remote workers alike. Some are being worked on, but many obvious problems are being worked on by no one. All of us who work on this have the same overall common interest. For each new problem that is solved in this new world, the higher chance of success all of us have together in the aggregate memeplex. And this is possibly the most important thing we can do to make the future a lot better than the present.

About the author

Sondre Rasch

Co-founder & CEO

SafetyWing

Sondre co-founded SafetyWing together with Sarah Sandnes and Hans Kjellby. Born in Bergen, Norway, he studied economics and computer science, before starting work as a policy advisor for the government of Norway advising on social policies. After getting frustrated with the slow pace of government change, Sondre first founded SuperSide (YC W16), a platform for freelance designers. It was here he discovered the lack of a safety net for online remote workers. SafetyWing was then born with the aim of building a global social safety net.