I think the 2 main reasons many will argue for the existence of the state (non-anarchy) are the problems of property rights and auditing/information finding.
Crime investigations need evidence, property rights need proof of ownership and the public need access to information to make an informed value judgement.
Blockchains can provide proof of ownership for property rights, proof of existence for evidence and public access to information with free market and non-aggressive solutions.
Proof of ownership - Without the aid of a state by way of prediction markets and third party auditors, or by more traditional means with land registries moved to blockchains, as in Honduras. http://www.coindesk.com/factom-land-registry-deal-honduran-government/
Proof of existence - photographs of crime scenes, recorded and verified witness-statements and other verifiable information can be collected by competing third parties and hashed into a blockchain. Identity verification will also be useful and can be provided.
Access to information - via crowdfunding journalists and predication-market assets representing assets and liabilities held by free-market businesses.
In order for the public to decide whether or not they want to reward or punish (buy or not-buy) a particular product/business they need to have a fully formed picture of who/what it is they are funding.
Digital assets representing the pollution, water usage and other noteworthy but non-money assets can present this information to the public. With a blockchain, a government or cost-sink entity is not needed to provide this information as bts facilitates trade between competing free-market entities.
Prediction markets provide information whilst at the same time provide a profit opportunity to those most-useful to society. Those who provide the most accurate information in this case, but in a more general sense those who fulfill the needs of the market best. In a free-market, the highest profit potential exists with the needs most-desired by the market (the public).
Rothbard interprets the physical extent to which a homesteading act establishes ownership in terms of the relevant "technological unit", which is the minimal amount necessary for the practical use of the resource. He writes:
If A uses a certain amount of a resource, how much of that resource is to accrue to his ownership? Our answer is that he owns the technological unit of the resource. The size of that unit depends on the type of good or resource in question, and must be determined by judges, juries, or arbitrators who are expert in the particular resource or industry in question
BitShares can facilitate the production and transfer of these "technological units" across the internet without counterparty risk.
In much the same way as prediction markets, a blockchain crowd-sources many functions of a government so that problems can be solved by competing entities without the need for a fallible third-party.
This is what it means for BitShares to have the potential to facilitate a truly free market.
Bitcoin is a free market currency, and BitShares is a platform for free trade.
I really liked your article!
It's a good overview of a complex topic and will be useful to send to others for a quick understanding