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Smart contracts on Bitcoin

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Re: Smart contracts on Bitcoin

#211

Post by mareko »

cocktailpeanuts wrote: post #142
qixxiq wrote: post #140

Following the links down a hole a little bit I saw this statement: "Bitcoin is by far the largest and most secure blockchain"[1] Sure it's the largest, but it seems ETH2 might now be the most secure. It (at current prices) has $2,400,000,000 staked in the network. Sure this is still in the league of nation states to corrupt, but the penalties for breaking the rules are _so much higher_. Given that, and the fact that…

having a lot of money staked doesn't mean it's secure. The security model of Bitcoin comes from proof of work, which most people complain as being waste. But it's not actually waste. It's secure because miners have to keep working hard and "wasting energy" because the network is worth protecting (and only if the network is worth protecting). With proof of stake, the stakers only need to make an investment once in the…

I think you're missing the fact that with PoS, you can use positive _and_ negative incentives to incentivize desired behavior while with PoW, you only have positive incentives. Once you can slash bad actors for enabling a double spend attack, you can significantly change their calculus.

Re: Smart contracts on Bitcoin

#212

Post by worik »

Why?

Still have not seen a use case for crypto currencies that is honest, legal, and not a waste. A lot of naivety and scamming as far as I can tell.

I am completely stumped as to why anybody who has programmed a computer and experienced how hard it is to get them right would think smart contracts are a better idea than plain old legal ones.

I am not saying that the current arrangements around private property, money, law, and power are good. I just do not see crypto currencies disrupting them. Nor smart contracts.

So, why?

Re: Smart contracts on Bitcoin

#213

Post by pharmakom »

uncletammy wrote: post #210
cheaprentalyeti wrote: post #106

Earlier quoted context omitted.

At the moment the Bitcoin blockchain size is some 310 gb while the bitcoin cash blockchain, with its larger blocks, is some 180 gb. I just looked it up. (I think I looked it up the last time I saw this argument too.) (I also can't easily find it for BSV, the search turned up too many articles about how they're increasing their block size to 2 GB.)

I dont follow. What does the size of either of those blockchains have to do with the discussion? What point are you making?

At the time there was the argument that larger blocks were bad because they would increase the size of the chain and prevent casual users from storing the whole chain and verifying it themselves.

I think the chain was already too big for casual users at that point!

Re: Smart contracts on Bitcoin

#214

Post by larrysalibra »

dperfect wrote: post #54

I'm not sure I've gotten a clear answer to this before, so someone please help me understand: I can see how smart contracts might be useful in contracts that involve other assets that are directly connected in the same decentralized context (i.e., other bitcoin transactions or blockchain entities). However, for anything else in the real world, they always (from what I've seen) require an "oracle" of some kind. True,…

Hi! Larry, Founder of New Internet Labs, building in the Stacks ecosystem here.

Your understanding of smart contracts is correct - whenever smart contracts deal with stuff in the physical world you need to have an oracle.

In my experience over past half decade, there's been a lot of misleading information spread by people about smart contracts with schemes like claim to be a good use for smart contracts that suffer from oracle problems. A lot of this has come from naive people that just didn't other stand, but some has been spread by people looking to make others part with their money.

The way I think about smart contracts, is that if you need to trust someone in the real-world, by default you probably don't want or need a smart contract.

That said, there are a subset of such instances where smart contracts that depend on trust in real world entities have proven to be very useful. Wrapped tokens and stablecoins are an example of this - Tether being the most famous.

Re: Smart contracts on Bitcoin

#215

Post by flashmob »

cocktailpeanuts wrote: post #142
qixxiq wrote: post #140

Following the links down a hole a little bit I saw this statement: "Bitcoin is by far the largest and most secure blockchain"[1] Sure it's the largest, but it seems ETH2 might now be the most secure. It (at current prices) has $2,400,000,000 staked in the network. Sure this is still in the league of nation states to corrupt, but the penalties for breaking the rules are _so much higher_. Given that, and the fact that…

having a lot of money staked doesn't mean it's secure. The security model of Bitcoin comes from proof of work, which most people complain as being waste. But it's not actually waste. It's secure because miners have to keep working hard and "wasting energy" because the network is worth protecting (and only if the network is worth protecting). With proof of stake, the stakers only need to make an investment once in the…

> The security model of Bitcoin comes from proof of work

This is not the security model, this is the consensus model. It's based on probabilistic finality, meaning that the probability that a transaction won't be reversed increases as more blocks are added on top. One major advantage of PoS is that it has "Absolute Finality" - after a certain amount of blocks, it's absolutely impossible to do a 51% attack. (See https://medium.com/mechanism-labs/finality-in-blockchain-con...)

Note that a higher hashrate does not mean more secure, it's a common falsehood. The security of bitcoin depends on the percentage of miners that are honest - this is mentioned the bitcoin whitepaper. Fortunately, the incentives align for the majority of miners to stay honest, and this is what the whitepaper predicted.

Re: Smart contracts on Bitcoin

#216

Post by Mooty »

sktrdie wrote: post #41

What kind of actual real world use-cases has ethereum's programmable "contracts" enabled? It's been out there for a while yet I fail to see where it made an impact.

Third party temporary reading for medical datas. For instance any kind of temporary access for something you need to keep private most of the time might be achieve through smart contracts.

Re: Smart contracts on Bitcoin

#217

Post by julioademar »

flashmob wrote: post #215
cocktailpeanuts wrote: post #142

Earlier quoted context omitted.

having a lot of money staked doesn't mean it's secure. The security model of Bitcoin comes from proof of work, which most people complain as being waste. But it's not actually waste. It's secure because miners have to keep working hard and "wasting energy" because the network is worth protecting (and only if the network is worth protecting). With proof of stake, the stakers only need to make an investment once in the…

> The security model of Bitcoin comes from proof of work This is not the security model, this is the consensus model. It's based on probabilistic finality, meaning that the probability that a transaction won't be reversed increases as more blocks are added on top. One major advantage of PoS is that it has "Absolute Finality" - after a certain amount of blocks, it's absolutely impossible to do a 51% attack. (See https…

Proof of work is not a consensus model, it's a method to elect a block author, an incentive mechanism designed to keep miners honest.

Consensus is the process through which the network agrees on state. Examples are Nakamoto consensus (e.g. Bitcoin), BFT (e.g. Tendermind) or GRANDPA+BABE (Polkadot).

Re: Smart contracts on Bitcoin

#218

Post by littlestymaar »

flashmob wrote: post #215
cocktailpeanuts wrote: post #142

Earlier quoted context omitted.

having a lot of money staked doesn't mean it's secure. The security model of Bitcoin comes from proof of work, which most people complain as being waste. But it's not actually waste. It's secure because miners have to keep working hard and "wasting energy" because the network is worth protecting (and only if the network is worth protecting). With proof of stake, the stakers only need to make an investment once in the…

> The security model of Bitcoin comes from proof of work This is not the security model, this is the consensus model. It's based on probabilistic finality, meaning that the probability that a transaction won't be reversed increases as more blocks are added on top. One major advantage of PoS is that it has "Absolute Finality" - after a certain amount of blocks, it's absolutely impossible to do a 51% attack. (See https…

Exactly.

In addition, the Bitcoin proof of work is pretty much a proof of stake scheme in practice, where the stake are physical (specialized hardware and access to cheap electric power). So most of the GP's complaints about proof of stakes can be applied to bitcoin as well (“With proof of stake, the stakers only need to make an investment once in the beginning, so it results in rich get richer”).

And the biggest difference between BTC and ETH when it comes to “security” isn't “proof of work“ vs “proof of stake”, it's the fact that Vitali Buterin is alive and that there is an official centralized stewardship of ethereum, which in practice have led them to actually hard-fork the ethereum blockchain.

Re: Smart contracts on Bitcoin

#219

Post by littlestymaar »

julioademar wrote: post #217
flashmob wrote: post #215

Earlier quoted context omitted.

> The security model of Bitcoin comes from proof of work This is not the security model, this is the consensus model. It's based on probabilistic finality, meaning that the probability that a transaction won't be reversed increases as more blocks are added on top. One major advantage of PoS is that it has "Absolute Finality" - after a certain amount of blocks, it's absolutely impossible to do a 51% attack. (See https…

Proof of work is not a consensus model, it's a method to elect a block author, an incentive mechanism designed to keep miners honest. Consensus is the process through which the network agrees on state. Examples are Nakamoto consensus (e.g. Bitcoin), BFT (e.g. Tendermind) or GRANDPA+BABE (Polkadot).

I think the GP meant: “the security comes from a consensus, not from proof of work”.

Re: Smart contracts on Bitcoin

#220

Post by notatrumper »

iso8859-1 wrote: post #84
noman-land wrote: post #69

Earlier quoted context omitted.

Smart contracts are mathematical contracts not legal contracts. They don't even have to be about IRL things. You could interact with a smart contract to, for example, change who can be authenticated to use a smart lock. Or you could have profile information about yourself in a contract, that can be changed.

They can't be about IRL things because those things cannot be verified in a decentralized manner.

Why not? The smart card and the lock are IRL. The smart contract knows who is allowed to open the lock. The lock can query the current state of the contract to check if the smart card being used on it is allowed to open the lock.

I have heard several stories by now of renters being defrauded by fake landlords. A smart contract could actually help. Decentralized would mean everybody can check who owns a property, not just the owner of some obscure property database.

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