Sebastian Louven and David Saive ‘Antitrust by Design – The Prohibition of Anti-Competitive Coordination and the Consensus Mechanism of the Blockchain’ ZRI Working Paper

This paper, available here , argues that important competition concerns arise from the use of consensus mechanisms in blockchains. Under such mechanisms, new information is only added to the database if the majority of network participants, the ‘nodes’, agree to do so. This requires coordination between the various network participants, which raises questions regarding whether and to what extent this voting behaviour is anticompetitive. The paper also discusses what type of measures may be adopted to ensure that a blockchain complains with competition law by design. It is structured as follows: Its second section provides the legal background for concerns about the functioning of consensus mechanisms. Information may be exchanged between competitors in a blockchain that would otherwise have remained undisclosed to the participating companies or the public. In some cases, public disclosure or selective disclosure of certain information may have procompetitive effects, e.g. when information is aggregated and contributes to greater price transparency so that customers can make more informed decisions, thus…

Christian Catalini and Catherine Tucker ‘Antitrust and Costless Verification: An Optimistic and a Pessimistic View of the Implications of Blockchain Technology’

This paper’s basic argument is that the blockchain holds both promises and threats for antitrust. There is reason to think that the decentralised nature of some blockchain implementations may reduce the need for antitrust enforcement, as it prevents the accumulation of market power by digital platforms. But there is also reason to believe that the technology may pose practical challenges for antitrust enforcement. Antitrust law is set up on the premise that there is a clearly demarcated firm (or set of firms) that may try to seek market power. The decentralised nature of the technology means that identifying an entity to prosecute or hold responsible for any degree of market power (or its abuse) is impossible, and that collusion and price setting between competitors may be harder to detect. The paper begins by describing the blockchain, and why it should matter for antitrust. From an economics perspective, an implementation of blockchain technology has two key characteristics: (i) a set of…

Falk Schöning and Myrto Tagara ‘Blockchain: Lessons learnt from the net neutrality debate and competition law related aspects’ (2018) Concurrences N° 3-2018

The paper, which can be found here, identifies a number of areas where competition law may intervene in the blockchain sphere, and discusses what the best approach to problems in this area are. One of the authors spoke at the OECD on the blockchain – you can see the video here.   The paper is structured as follows: It begins with a short introduction to the blockchain technology. The paper reviewed above provides a much more detailed intro into the topic than this paper, so I am not going to repeat it here. Section III then looks at the interplay between blockchain and competition law. It starts by recalling that competition law provisions apply to undertakings. From a competition law perspective, the blockchain landscape of today is analogous to that of search engines, e-commerce platforms and algorithms in the 1990s. Ten years ago, no one thought that competition law authorities would focus their enforcement priorities on these applications, triggering investigations…

Thibault Schrepel  ‘The Antitrust Blockchain Paradox’ 3 Geo. L. Tech. Rev. (Forthcoming)

This paper, which can be found here, seeks to portray the challenges that might arise regarding unilateral practices as a result of the deployment of blockchains.     It is structured in three parts: The first section details how unilateral practices can be implemented on blockchain and draws a risk map. It begins by describing how the blockchain works. This was already described in my reviews above, but it is worth pointing out that the author places some weight on the existence of two main forms of blockchain: public blockchains, also called permissionless or open blockchain, and private blockchains, also called permissioned blockchains. The main difference is that in the latter the permission to access the contents of the blockchain may be restricted to certain participants only. In practice, semi-private and private blockchains can have a multitude of access levels. The paper then turns onto conditions for the enforcement of competition law against unilateral practices. It begins by noting that there are…