Part 2: Subnets Are Sovereign

How rollups, appchains, and execution zones became the programmable nations of the digital age

This piece kicks off a four-part series tracing how modern blockchain protocols are quietly transforming the structure of power, governance, and identity. In a world increasingly mediated by machines, agents, and smart contracts, the new battle isn’t between countries, it’s between consensus layers. This series, You Are a Citizen of Your Stack, explores what it means to build and live inside programmable systems, and how they are reimagining the very concept of sovereignty.

We begin with the foundation: the Layer 1. This first installment unpacks why only one L1 will ultimately survive, how composability drives convergence, and why all digital jurisdictions will eventually rest on a single, global substrate. From there, we’ll explore the rise of subnets as programmable nation-states, how rollups, zones, and shards are enabling local governance while remaining anchored to a unified source of truth. We’ll then examine identity, and how Universal Profiles are emerging as digital passports, granting access, authority, and interoperability across sovereign stacks. Finally, we’ll look ahead to agents, migration, and the geopolitical implications of composable citizenship in a multi-agent world.

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If Layer 1 Is Earth, Subnets Are the Countries

In Part 1, we planted our digital feet on the bedrock of the blockchain universe and declared that Layer 1s are not platforms, apps, or even networks. They are nature. They are programmable geology. The crust on which everything else rests. And much like the Earth itself, they don’t care what you build on top of them, as long as you obey the rules of gravity, finality, and gas fees.

Now it’s time to climb up a layer and take a look around. Welcome to the surface. This is where things start to get... lively. If the Layer 1 is Earth, subnets are the nations etched across its surface. They are jurisdictions in the most literal sense. Not the metaphysical “vibe” of a DAO or the marketing of a Layer 2 with good documentation. No, these are programmable political economies, complete with governance systems, economic incentives, power struggles, and cultural quirks that would make a Renaissance city-state blush.

Think of a subnet as a digital country that may or may not have a GDP but definitely has at least three governance proposals up for vote, a discord war in progress, and one guy who always says “we’re early” right before launching a token with no utility. Some subnets are structured like Swiss democracies with clean APIs and neat documentation. Others operate more like pirate islands run by anonymous influencers and sentiment oracles. A few are basically Burning Man with validators. Others are rebranded Layer 1s pretending to be humble little zones because they heard “modularity” was in this season.

What makes them fascinating is not just the diversity of structures, but the fact that they all ultimately plug into the same gravitational field: the Layer 1. Whether it’s Ethereum, Solana, Dfinity, or NEAR, the base layer is the source of truth. The substrate. The court of final appeal. It doesn’t matter if your subnet thinks it’s a republic, a monarchy, or an anarcho-frog collective. If it settles on Ethereum, it lives and dies by Ethereum’s rules. It can run its own validator set, issue its own token, and vote on emojis in its governance UI, but when the time comes to finalize a transaction or resolve a fork, gravity pulls downward.

This isn’t a limitation. It’s a feature. Subnets inherit security, finality, and composability from the Layer 1. They get to write their own laws, but the laws of physics are handled for them. That’s the power of programmable sovereignty. You don’t have to bootstrap your own universe. You just rent space in one that already has mass.

And just like physical nations, subnets don’t just make rules. They evolve culture. They create norms. They have public holidays (usually tied to airdrops), national anthems (usually on Sound.xyz), and mythologies about the founder’s wallet. They argue about taxes. They complain about governance participation. They fork. They fight. They meme.

So no, subnets aren’t just scalability hacks. They’re not just fancy ways to squeeze more throughput out of Ethereum’s engine. They are programmable nation-states, each one experimenting with its own version of sovereignty, legitimacy, and identity. Some will collapse. Some will thrive. Some will get acquired by Coinbase.

But all of them, every single one, will be shaped by the invisible force of the Layer 1 they rest on. Just like tectonic plates drifting across the molten core of programmable consensus, they live by the same truth: you can build whatever you want, but gravity always wins.

Rollups, Zones, and Shards as Programmable Governments

If subnets are the digital countries of this new world, then rollups, zones, and shards are the wildly different systems of government running them. Some resemble benevolent technocracies. Others feel more like barely functional memeocracies where the loudest thread on X gets to write the constitution. These execution environments may share the same base layer DNA, but their local governance models are as varied as the drama channels in a DAO Discord.

Rollups are currently the most popular form of subnet sovereignty, especially inside Ethereum’s expanding empire. They inherit security from the base chain but handle execution and gas locally. Think of them as city-states with their own budgets, voting systems, and brand mascots. At the end of the day, they all report to Ethereum for final settlement. Arbitrum wants to be your high-speed financial capital. Optimism calls itself a Collective, which sounds a bit like a worker-owned coffee shop that also handles billions in liquidity. zkSync wants to be a cryptographic utopia but requires a PhD in zero-knowledge just to open the docs.

Cosmos, in contrast, prefers a more hands-off approach. Its sovereign zones behave like fully independent states within a very chill federation. Each zone runs its own validator set, token economy, and experimental governance model, ranging from quadratic everything to pure delegation based on social trust and emoji-based signaling. You can spin up your own zone, name it after a star or a planet, and start voting on inflation policies by the end of the week.

Avalanche subnets fall somewhere between startup and state. Each one is a customizable chain optimized for a specific purpose. Some focus on games. Others on DeFi. All of them feel like someone took the idea of special economic zones and added NFTs, staking, and a pitch deck.

These aren’t just software configurations. They are constitutional blueprints. They dictate who gets to vote, how proposals are passed, which economic assumptions get hardcoded into law, and whether forking the protocol counts as treason or just another Tuesday. The difference between a “rollup” and a “zone” is not just technical. It’s philosophical.

Welcome to forkable federalism. Want your own country? Fork an existing one. Tired of the tax rate? Clone the chain and lower it. Think your community is losing its way? Spin up a subnet that returns to the old values, then issue tokens to people who held the original meme through three market cycles. Political revolution has never been so copy-paste.

And these new governments are fast. They don’t wait for midterms or judicial reviews. When the token holders are angry, they vote. When the validators disagree, forks happen. If the founder gets too weird, the community organizes a public trial on X, moderated by someone named @CryptoShaman69. This is not politics as usual. This is governance as software.

In these programmable nations, you don’t have to be born there. You just need a wallet and something to believe in. Citizenship is staked, not assigned. Allegiance is optional. Delegation is expected. And if things go sideways, you don’t protest. You fork.

The world map isn’t built on land anymore. It’s rendered in blockspace.

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The Spectrum of Sovereignty

Not all subnets are created equal. Some walk around like sovereign nations with puffed-up validator sets and custom tokens. Others are more like rented condos in Ethereum’s skyscraper, complete with community rules, shared walls, and a landlord named Vitalik. This is the messy, glorious spectrum of on-chain sovereignty.