The concept of Libertarian Municipalism was founded by the American Anarchist Murray Bookchin, based on the concept of Libertarian Socialism that he pursued late in his life.
It primarily concerns the decentralisation of political power away from a centralised, representative government who are becoming increasingly detached from the citizens that they are supposed to represent, and back into the hands of ordinary citizens through citizen assemblies and direct democratic decisions made at a local (municipal) level, or through labour unions or special interest groups.
Similar to how the rise of cryptocurrencies have pinpointed the redundancies of central banks and large corporate financiers, by - for want of a better phrase - cutting out the middle man, I believe that direct democratic decisions can be made through the use of blockchain technology without the use of a ‘representative’ congressman or parliamentarian to decipher the will of the people.
A great example of the gap between elected representatives or bureaucrats and the popular will of the people is the recent decision by the US FCC to roll back net neutrality. The US population overwhelming wanted net neutrality regulations to remain (90%+ by some polls), but the commission board voted to revoke the protections after a lot of face time with telecom company lobbyists and very little with internet users. Through the use of direct democracy, internet users could sign up to an assembly of internet users and vote on the issue through a blockchain-based referendum. Or each local municipality could vote on whether to keep the regulations on a local level.
Decentralisation is the key to unlocking democracy in the 21st century. Washington/Westminster politicians too easily fall prey to the wishes of financial interests and vote against the overwhelming wishes of the citizens they supposedly represent. We now have the technology to implement a genuinely grassroots system of government, so why not use it?
You can read more about Bookchin's ideas at the Institute of Social Ecology or Libcom:
http://social-ecology.org/1999/08/thoughts-on-libertarian-municipalism/