> “which we have unthought of”
Someone has to make this into a meme. It will definitely be my excuse for my next multi-hundred million dollar value destroying software bug.
The collapse of the IRON stable coin
381–390 of 502 posts
Re: The collapse of the IRON stable coin
#382Earlier quoted context omitted.
I missed out on the unregulated ICO rush because I thought you had to, you know, develop a new blockchain technology for your new cryptocurrency, which is really hard, and I was busy. Much later I learned all you had to do was copy and paste a Solidity program and then promote it. Guess I dodged an ethical bullet in my ignorance, but still...
You can create a new coin in a couple hours, the "hard work" is in selling and promoting it...
…and for Americans, not getting in trouble with the SEC.
Re: The collapse of the IRON stable coin
#383Earlier quoted context omitted.
For prices you can use Uniswap's oracle which is time weighted average price and can't be manipulated unless you buy a ton of the token over the entire time period. In this case it was using a Sushi swap oracle (uniswap clone that's on matic) with very liquid pools so it was accurate, just lagged a bit when titan was dropping rapidly.
The general consensus is that it's a terrible idea to rely on Uniswap (or any other dex) as a price oracle for valuation/pricing for other on-chain defi applications/dexes. With enough capital (which can be acquired through flash loans) you can absolutely perform economic attacks though atomic transaction chains involving moving the dex price. Uniswap, Kyber, and others will tell you the same thing. This makes me thi…
Flash loans are not relevant to the uniswap TWAP oracle, which ignore any transactions in the current block. That oracle was written specifically to be resistant to manipulation and I don't think there's any consensus not to use it.
Re: The collapse of the IRON stable coin
#384Earlier quoted context omitted.
They are trading one legal authority for another, and this is agreed upon up front. Both parties agree that the code is the legal authority before entering into a contract, which is much different from evading authority after the fact. > but generally when a person is trying to evade some legal authority, it's probably not for reasons good for society Reminds me of the "nothing to hide" argument, that only someone tr…
>They are trading one legal authority for another, and this is agreed upon up front. Both parties agree that the code is the legal authority before entering into a contract, which is much different from evading authority after the fact. The parties might "agree", but who cares? If they are in the US, for example, and the two parties have a smart contract that breaks US contract law, one of the parties can file a laws…
Freedom of contract is pretty well respected in the US, there are very few exceptions where carve outs are made where people are not allowed to contract freely. So its not clear what a “smart contract that breaks US contract law would be”, its much more likely for a smart contract to be a outright scam or illegal though, in which case good luck finding the funds or whom to sue.
Re: The collapse of the IRON stable coin
#385Earlier quoted context omitted.
Well, we can already see they screwed up a basic piece of code in the IRON smart contract, so is that really so surprising?
I suppose yes and no. Screwing up the maximum supply seems like an enormous blunder while I kinda understand the assumption that “price > 0” if they’re supposed to be backed by 75% usdc.
You might be confused. The "price > 0" refers to the price of TITAN. TITAN isn't backed by USDC at all. IRON is (ideally) backed by 75% USDC and 25% TITAN.
Re: The collapse of the IRON stable coin
#386This has always been the problem with smart contracts. They are infact dumb contacts. To program one you need to think about all the edge cases. The programmers here likely did want >0 here. The possibility that the thing feeding price data return zero incorrectly was higher than the price legitimately being zero in their minds. There is no court or lawyer who can interpret the spirit of the contract.
This is why Cardano smart contracts will be so strong in August. The language running underneath it all is Haskell, a functional programming language where you can prove the code will work as intended. You won't have to constantly put out fires like in Solidity.
Re: The collapse of the IRON stable coin
#387> Non-collateralized stablecoins require continual growth to be successful. In the event of a price crash, there is no collateral to liquidate the coin back into, and the holder’s money would be lost, as seen with many past projects trying to utilize such design [sic]. Isn’t that just a Ponzi scheme?
Isn't that how USD works too? It only holds value if people keep wanting it.
Yep
Re: The collapse of the IRON stable coin
#388Earlier quoted context omitted.
> That's obviously the point, though. You are trading one set of risks for a completely different set of risks. But that's exactly the point. People are not able to interpret "smart" contracts. For normal contracts most people can understand the contract and if there is a dispute you have laws and courts who can interpret in every case. In case of "smart" contracts even the contract developers more often than not see…
Well, to be fair, people write legal contracts without fully understanding what they are writing all the time too. I do disagree that people understand them on most cases. Things are better on consumer law because it assumes from the start that people are stupid and have no idea what they are doing. But other kinds of contracts have quite large security risks.
Yes, and when normal contracts don't (because they can't) anticipate every possible scenario, there is a meta layer on top of that to resolve edge cases.
In the case of a smart contract, it can even happen that both parties agree in how things should take place when there's a problem! But bad code doesn't work that way, and you can find yourself in a null state of indeterminacy without a built in layer to resolve that.
The entire evolution of legal jargon can be viewed as an attempt to provide a linguistic framework whereby ambiguity is minimized and edge cases are anticipated. But human interactions are chaotic and all outcomes or scenarios can never be predicted, hence the need for a layer of human judgement.
That layer is imperfect, sometimes wrong, sometimes biased, but still necessary. I don't see how smart contracts can work without that sort of layer, but with a human judgment layer then they're not really smart contracts in the way people want such contracts to function.
Trusting any smart contract of sufficient complexity is like trusting that a code base has absolutely zero bugs and zero unanticipated edge cases. I just don't see that as realistic.
If a programmer at a bank or exchanged should have coded ">=" then I want 1) for them to easily be able to act on their intentions instead of their mistake or 2) the ability to bring in a 3rd party to interpret and resolve the situation if #1 doesn't work out.
Re: The collapse of the IRON stable coin
#389Earlier quoted context omitted.
> That's obviously the point, though. You are trading one set of risks for a completely different set of risks. But that's exactly the point. People are not able to interpret "smart" contracts. For normal contracts most people can understand the contract and if there is a dispute you have laws and courts who can interpret in every case. In case of "smart" contracts even the contract developers more often than not see…
eh, for a regular financial contract you need lawyers and judges. There is plenty of counterintuitive law that burns people. For this one you need programmers and computers. On both cases, if you go in blind or wing it you might get burned.
Yep, and programmers only have a few decades instead of hundreds of years to have built up generational knowledge of pitfalls and best practices, and even then traditional systems get things wrong.
I'm not convinced that programmers and computers can bootstrap to that level of experience very quickly. I think a decade ago I was more optimistic on that possibility, but a decade of repeating history has made me a bit more pessimistic on that ability and cynical about the motives of most people involved.
Re: The collapse of the IRON stable coin
#390Earlier quoted context omitted.
Not exactly. There are plenty of anonymous projects, developers and users.
Plus, even if they lose their anonymity, many are in places like Eastern Europe where suing them won't be so easy.
"Smart contracts and cryptocurrencies - great for anonymous people in Eastern Europe who want to avoid the law, less so for other types of people"
It's not an argument that's going to convert many people, but at least it's honest.