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Do Cryptocurrencies Provide ANY() Real-Economic Value at All?

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Re: Do Cryptocurrencies Provide ANY() Real-Economic Value at All?

#61

Post by mindcandy »

acdha wrote: post #57
comodore_ wrote: post #43

> "Smart contracts". All (democratic) countries have courts in place to settle legistlative disputes between two parties. The case for smart contracts is, you can't have disputes. No need for attorneys, that will bleed you dry. It does not add an additional layer, instead it removes them all and becomes the sole layer.

Who writes those contracts? Who debugs them? Who settles disputes if one the parties feels that the other isn’t honoring them? This replaces attorneys by creating attorney-programmers who charge more and have less recourse when someone makes a mistake.

The assumption that smart contracts are going to cost more than attorneys is presumptive. For the common cases, open source contracts will be inevitable. This will give the world’s poorest options that were never available before.

Re: Do Cryptocurrencies Provide ANY() Real-Economic Value at All?

#62

Post by 1cvmask »

ur-whale wrote: post #9

If you live in Turkey right now and want to move capital out that cesspit, cryptos are a pretty good option (even if they've just been made illegal).

Crypto is not illegal in Turkey, or for that matter other financial instruments including foreign exchange or gold. The central bank regulated crypto for payments as of April 30. Apparently the only place that offered crypto as a payment form was the Rolls Royce dealership.

“This week Royal Motors, which distributes Rolls-Royce and Lotus cars in Turkey, became the first business in the country to accept payments in cryptocurrencies.”

https://www.reuters.com/article/turkey-crypto-currency-idINK...

What other countries do you consider a cesspit? What is your criteria for a cesspit?

Re: Do Cryptocurrencies Provide ANY() Real-Economic Value at All?

#63

Post by smt88 »

mindcandy wrote: post #58
lottin wrote: post #41

Earlier quoted context omitted.

How would a smart contract work in the case of, say, a residential tenancy agreement? How does the smart contract know if the terms of the agreement have been met or not? And how would the contract be enforced, for instance, if the tenant fails to pay rent?

I’m not a smart contract dev, but here’s my understanding. You have three fundamental tools to worth with: money, time and signaling consent. The only way to enforce consequences without lawyers is collateral. So, you could have a contract that requires two months rent as a deposit to start. From there you can have simple rules: if the contract expires, the tenant gets the deposit back. At the end of the contract, th…

This smart contract has no way of knowing if/what the damages are, whether the rent was paid in cash, or whether a million other legal issues are happening.

For example, in most places, tenants may stop paying rent if their heat breaks in the winter and the landlord won't fix it promptly.

The central authority will always be human courts. Smart contracts can't observe or record anything except crypto, which makes them useless in 99% of contractual disputes.

Re: Do Cryptocurrencies Provide ANY() Real-Economic Value at All?

#64

Post by dmitriid »

mindcandy wrote: post #58
lottin wrote: post #41

Earlier quoted context omitted.

How would a smart contract work in the case of, say, a residential tenancy agreement? How does the smart contract know if the terms of the agreement have been met or not? And how would the contract be enforced, for instance, if the tenant fails to pay rent?

I’m not a smart contract dev, but here’s my understanding. You have three fundamental tools to worth with: money, time and signaling consent. The only way to enforce consequences without lawyers is collateral. So, you could have a contract that requires two months rent as a deposit to start. From there you can have simple rules: if the contract expires, the tenant gets the deposit back. At the end of the contract, th…

So, literally not better than an existing contract, but with the added complexity of coding it and having both the landlord and the tenant be programmers versed in esoteric languages to verify it.

Re: Do Cryptocurrencies Provide ANY() Real-Economic Value at All?

#65

Post by lottin »

WnZ39p0Dgydaz1 wrote: post #54
maxerickson wrote: post #48

Earlier quoted context omitted.

In your description, you used the word 'enforcer' for the entity that does the important bit. That entity isn't the contract.

What do you mean by "That entity isn't the contract"? Yes, the enforcer is not (necessarily) part of the contract. But if the right incentive system is in place and there is consensus that physical enforcement should happen - anyone approved could take that job/risk and be the enforcer. With such a system you may not even need a physical enforcer since the risk of not getting the tenant out could be tradeable (like a…

The point is that such a contract requires a central authority that must be capable of evicting the tenant. A "smart contract" which is just some code running on a computer certainly can't do that.

Re: Do Cryptocurrencies Provide ANY() Real-Economic Value at All?

#66

Post by mindcandy »

pgesmm wrote: post #60
comodore_ wrote: post #43

> "Smart contracts". All (democratic) countries have courts in place to settle legistlative disputes between two parties. The case for smart contracts is, you can't have disputes. No need for attorneys, that will bleed you dry. It does not add an additional layer, instead it removes them all and becomes the sole layer.

Suppose we two make a "smart contract": I say I pay 100k, you say you sell me a functional car. Let's say you then deliver a broken car. Now what? How can't we have disputes, we did a "smart contract"?

You and I can agree on an independent 3rd party as a notary. If within a six months of the sale both you and the notary sign off that the deal was not fulfilled (the car is junk), you get the $100k back.

That means I can’t spend the $100k directly for six months. But, I can easily take out a six month loan against it. That way it’s liquid for me and still safe for you. The loan agent is taking on the risk in exchange for the interest.

Re: Do Cryptocurrencies Provide ANY() Real-Economic Value at All?

#67

Post by wheresmycraisin »

WnZ39p0Dgydaz1 wrote: post #54
maxerickson wrote: post #48

Earlier quoted context omitted.

In your description, you used the word 'enforcer' for the entity that does the important bit. That entity isn't the contract.

What do you mean by "That entity isn't the contract"? Yes, the enforcer is not (necessarily) part of the contract. But if the right incentive system is in place and there is consensus that physical enforcement should happen - anyone approved could take that job/risk and be the enforcer. With such a system you may not even need a physical enforcer since the risk of not getting the tenant out could be tradeable (like a…

The tenant is mentally ill, has a gun, and is refusing to leave. The enforcer says "f that". What do you do now?

Re: Do Cryptocurrencies Provide ANY() Real-Economic Value at All?

#68

Post by mindcandy »

dmitriid wrote: post #64
mindcandy wrote: post #58

Earlier quoted context omitted.

I’m not a smart contract dev, but here’s my understanding. You have three fundamental tools to worth with: money, time and signaling consent. The only way to enforce consequences without lawyers is collateral. So, you could have a contract that requires two months rent as a deposit to start. From there you can have simple rules: if the contract expires, the tenant gets the deposit back. At the end of the contract, th…

So, literally not better than an existing contract, but with the added complexity of coding it and having both the landlord and the tenant be programmers versed in esoteric languages to verify it.

That’s a super-bad-faith argument. Did you personally write the legal contract for the last place you were a tenant of without any involvement from a lawyer? No. Your landlord might have hired a lawyer. Mine used an off-the-shelf legal contract.

For common situations like rent, open-source contracts are inevitable. This will give people who could never afford lawyers (think 3rd world) access to much of the results middle class Americans take for granted.

Re: Do Cryptocurrencies Provide ANY() Real-Economic Value at All?

#69

Post by WnZ39p0Dgydaz1 »

lottin wrote: post #65
WnZ39p0Dgydaz1 wrote: post #54

Earlier quoted context omitted.

What do you mean by "That entity isn't the contract"? Yes, the enforcer is not (necessarily) part of the contract. But if the right incentive system is in place and there is consensus that physical enforcement should happen - anyone approved could take that job/risk and be the enforcer. With such a system you may not even need a physical enforcer since the risk of not getting the tenant out could be tradeable (like a…

The point is that such a contract requires a central authority that must be capable of evicting the tenant. A "smart contract" which is just some code running on a computer certainly can't do that.

Why do you require a central authority? What you require is this:

1. An incentive to evict someone. Money. Someone needs to get paid to actually do the eviction because they are taking on some risk - physical in this case. It doesn't matter how they get paid. A smart contract can do that.

2. "Social/Legal consensus" that performing the physical eviction is the right thing to do. The person performing the eviction should not get punished for it. If the state and breach of contract is transparent on the blockchain this consensus could be achieved.

3. A way to confirm the eviction to pay the evictor.

Re: Do Cryptocurrencies Provide ANY() Real-Economic Value at All?

#70

Post by WnZ39p0Dgydaz1 »

wheresmycraisin wrote: post #67
WnZ39p0Dgydaz1 wrote: post #54

Earlier quoted context omitted.

What do you mean by "That entity isn't the contract"? Yes, the enforcer is not (necessarily) part of the contract. But if the right incentive system is in place and there is consensus that physical enforcement should happen - anyone approved could take that job/risk and be the enforcer. With such a system you may not even need a physical enforcer since the risk of not getting the tenant out could be tradeable (like a…

The tenant is mentally ill, has a gun, and is refusing to leave. The enforcer says "f that". What do you do now?

This is a spectrum similar to taking out loans and performing liquidations. If the person you are giving a loan too is sketchy you may refuse the loan or charge higher interest.

The same principle applies here as physical eviction is fundamentally about risk. There is an "auction" on the eviction and potential evictors can decide how risky the eviction is. More risky evictions will require a larger payout.

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