Digital Platforms and Blockchains: the Age of Participatory Regulation

The evolution of market regulation in recent years has accelerated the combined outcome of market globalization and digitalization. The regulatory frontier is therefore represented by digital platforms and, in recent years, by the blockchain. Apparently, the rules regulating digital platforms (Web2) and blockchains (Web3) on each side of the ocean appear mutually incompatible on a legislative (primary) level. Nevertheless, we have recently witnessed a significant convergence between the regulation of the two ecosystems on the implementation (secondary) level. Convergence arises from the ‘regulatory circle’, typical of co-regulation in the EU, but also compatible with self-regulation in the US. Co-regulation and self-regulation, both implemented through the ‘regulatory circle’, generate a ‘participatory regulation’: regulatory and supervisory authorities cooperate with operators to set the rules, which are embedded in the technology. Technology is a discriminating element. Hence, what we see in practice both in the EU and in the US is a ‘participatory regulation by technology’. Participatory regulation by technology overcomes twenty years of regulation based on network neutrality, changing its fundamentals from the outset.