In the late 80s and 90s, I was a big fan of John Perry Barlow, the independence of cyberspace, crypto-anarchy on the internet, the idea that some combination of a uncensorable world wide internet (that could route around governments), could displace even their national currencies, could be end to end anonymous and encrypted, would be a nirvana from oppression.
The problem with the naive cyberlibertarian world view, is that it treats government as a wholly separate actor from the people who create the society they live in, and if your neighbors want to be Nazis, technological choices aren't going to protect you. It's not just "Digital Nationalism" that's rising. Nationalism is rising. You need only need at the US electing Trump, Brexit in the UK, at some of the neo-fascists elected recently in the EU.
The optimism of the 90s, has been replaced with a mentality of scarcity, and when that happens, people look to hoard, they become less generous, more tribal, they circle the wagons.
We are not going to fix Nationalism until we fix the underlying economic and social problems that are giving rise to it.