Nikolas Guggenberger is a Clinical Lecturer in Law, a Research Scholar in Law, and as of today, the Executive Director of the Information Society Project at Yale Law School. His research focuses on the intersection of law and technology, specifically platform regulation, privacy, the automation of law, and the future of private law. He is especially interested in artificial intelligence and algorithmic governance. Mr. Guggenberger has frequently advised government entities, served as an expert witness and on advisory committees, mainly on matters relating to financial technology, financial markets regulation, digital policy, and media law. Previously, Mr. Guggenberger was an Assistant Professor at the University of Münster School of Law, where he taught contract, consumer protection, copyright, and information law. Before then, he served as a policy advisor to Jakob von Weizsäcker at the European Parliament in Brussels, working in the field of banking and financial markets regulation as well as monetary and economic policy.
The Politic: How did you get involved in the blockchain space?
Nikolas Guggenberger: I got involved with blockchain in 2015 because I was working for the European Parliament. I worked for a representative who was on the so-called “ECON” committee, which dealt with economic affairs and international regulations. We drafted the European Parliament’s first resolution on virtual currencies. The work on that started in 2015, and I stuck with that topic after leaving the European Parliament and politics for academia. I’ve been working as an Assistant Professor at the University of Muenster in Germany for the past two-and-a-half years. I’ve since broadened the topic from covering financial markets regulation to also covering automation of law, smart contracts, and consumer rights.
What was that like working at the European Parliament? How many people were you working with?
Like every parliament, the general setting is that you have parliamentarians, and those parliamentarians have personal offices. I worked in the personal offices of Jakob von Weizsäcker in Brussels. Now, the operational teams in the European Parliament, per representative, are much smaller than those of U.S. Senators or U.S. Congressmen.
With respect to any sort of legislative measures, including resolutions, this effort is usually led by one of the members of Parliament, just as somebody might sponsor a bill in the U.S., and the member of Parliament gets some support from the committee staffers. If you want to basically add up all the people that contributed to an effort like that, it was essentially me, the member of parliament, and two staffers from the committee.
Of course, other political groups contribute as well. If there’s a resolution or a legislative measure moving through parliament, there’s one representative or one member who is the lead on that, i.e., the sponsor of the bill, and then all of the other political groups assign so-called “shadows” or “shadow operators,” to accompany the process: to provide their input, to suggest compromises, or to suggest amendments to the initial draft.
You need them to ensure a majority in the end, so they and their offices also contribute in a way. At the same time, they weren’t really our team. They were political opponents, and we had to find compromises with them. So, I’m not really sure how to count them, i.e., whether I should count them as productive contributors to a joint effort, or whether I should actually deduct them from the number of people on our team because they’re political opponents. Think about it this way: The most positive outcome is you strike a compromise, and the worst outcome is they destroy your work.
So, the teams involved are very, very small. At an early stage, we tried to involve quite a lot of experts in the discipline. We had one large public hearing, and we held a couple of closed-door committee hearings with experts, including some from the U.S. Back then, this was the early stage of the blockchain hype, or the development of blockchain, and this was our main path to expanding our somewhat resource-constrained knowledge base. In the end, our team consisted of more-or-less four people: the member of Parliament, me as the lead staffer, and then two separate Parliament staffers from those committees which supported the work. If you’re a Democratic staffer or a Republican staffer, would you consider the other staffer to be “on your team,” or would you consider them to be a drag on your efforts?
That’s interesting that you were thinking about regulation that early. Do you think there’s more technological literacy in European Parliament than in the U.S. Congress?
People were very interested in that style back then. I’m not sure whether it has to do with technological literacy, or more to do with blockchain’s rise in popularity back when we voted on that resolution in 2016. I mean, between January of 2016 and April of 2016, Ethereum as a currency increased by seven to ten times or so. At the point of the final vote, which was in May, the price of Ethereum had experienced about a 100-fold price increase compared to January of that year.
I think that price surge created an incredible hype, and that hype created an incredible interest, especially in the community of financial market lobbyists, who are at the core of public interest in that area. So, if the lobbyists are engaged, then often the media are engaged. And if the media are engaged, then eventually word spreads to the broader public. What got those people and the industry lobbyists engaged was simply the increase in price, and the hopes they associated with Ethereum’s development. In short, I don’t think it was technological literacy. I think it was the hype.
What projects are you currently working on?
I’m with the Information and Society Project at Yale, and I will take over as Executive Director tomorrow. I am very interested in all sorts of aspects around “platform regulation,” that being not only privacy regulation of social media platforms but also aspects of consumer protection and antitrust regulation for e-commerce platforms.
Apart from that, I am interested in the emerging technologies. I’ve continued to work on aspects of FinTech, especially as it’s continued to develop from the early stages of blockchain into various types of financial technologies. I’m also interested in other areas of research, like the relevant aspects of online autonomy, and I’m trying to pivot a bit into legal or policy questions around artificial intelligence. I haven’t published in that area.
Which areas of platform regulation most interest you?
I think the most interesting questions at the moment are structural ones. What structures do you set up? What market structures do you want to see implemented? How do you want the current structure to change? How can you try to make the market more competitive? How can you prevent monopolization and abuse of market power in an environment that’s driven by the large firms?
Another aspect that I find incredibly interesting since all sorts of national policies and measures are probably limited in their overall impact: How do you coordinate those objectives on an international level? I am very interested in how collaboration in policy can and will work in the future.
What’s the current state of international collaboration in the space?
There’s actually quite a bit of international coordination that’s already happening. There’s the Financial Action Task Force (FATF), and they’re pretty good in terms of coordinating policies internationally. So yes, of course you have different levels of coordination within different jurisdictions. For instance, you have different levels of disclosure requirements. But, if you compare the level of coordination to other areas of law like privacy, free speech, competition, antitrust, and so on, this area is highly, highly harmonized.
Most jurisdictions in the Western Hemisphere do follow recommendations made by FATF, so this is an area where you see a lot of international collaboration and coordination. In fact, I think this space could serve as an example for many other areas. I’m just not sure whether there will be as much consensus on policy in other areas as there is in this area.
What kind of research is going on at Yale right now with respect to the space?
I can only speak for what’s happening at the Information Society Project. They really, really have a very diverse group of scholars working on various issues at the intersection of technology and law, and especially with respect to communication and free expression.
We have people looking into online content moderation, people looking into the functioning of needs organizations, people looking into global discourse on social media platforms in the Global South, people who are interested in very, very traditional and foundational aspects of the first amendment and developing more doctrinal approaches to guarantee that the First Amendment will sticks around in the future.
We have people that are interested in autonomous weapons systems and how they should potentially be regulated. We have people interested in the Internet of Things. And going beyond that, we have people who are interested in very foundations questions around the functioning of democracy and how to ensure certain constitutional values.
So, it’s a really diverse group of scholars, and every year we get a bunch of international fellows that contribute valuable and valued input from other jurisdictions. It’s mainly lawyers, but the community is by no means limited to lawyers. We have communication scientists, people with dual degrees in all sorts of fields, political scientists, journalists, and so on. It’s a really, really inspiring and great community.