If we are to embrace the empowering effect that modern communications technologies have had for people, we should start by officially, as a country, recognising the choices of our friends who opt for a different national path. I refer to the micronations such as Sealand and Freedonia. I refer to distributed and virtual nations such as BitNation. If national borders just aren't what they used to be any more thanks to the internet, why should we put ourselves on the wrong side of history?
There is the Declaration of Independence of Cyberspace. Any forward thinking party worth its salt should see that these expressions of freedom are to be celebrated and worked with, not against. Appoint an official Ambassador to the Micronations. Establish consular simulations in the virtual worlds for diplomatic training and testing of new diplomatic paradigms. Work with, not against, these pioneering spirits.