Smart Contract Security Field Guide • Hacker News Board

Re: Smart Contract Security Field Guide

#81

Post by javier123454321 » Thu, Jul 27, 2023, 12:02 AM UTC

duxup wrote: post #27

Can someone give me a good use case (even better if you're doing it yourself) for a smart contract? What is anyone doing with them that they find really handy? I've never been able to understand how it gets used / why you would use smart contracts. I've googled and read... still don't grok it. I've seen so many "benefits" listed, but none make sense to me as far as the process you go through and how it works out in t…

We did what I thought was an interesting use case. Giving artists an ability to manage royalties in perpetuity for sales of a digital artwork through cryptography. Here is the breakdown:

https://medium.com/valorize-dao/how-we-are-developing-a-smar...

Re: Smart Contract Security Field Guide

#82

Post by Uptrenda » Thu, Jul 27, 2023, 12:04 AM UTC

kspacewalk2 wrote: post #75

Uptrenda wrote: post #65

Earlier quoted context omitted.

It's not this specific question. It's the fact that any time anything about blockchain tech is posted on hacker news the first comment will be 'b-but where are the use-cases' with the second being something like 'lol scam.' It would be the equivalent of replying to every HN post with 'but why would anyone want to own a personal computer?' That's how irrelevant and uninformed these posts are.

Asking about practical applications of a relatively mature technology is an entirely, 100% legitimate question to ask. It is frequently asked about many other techs and advances, although it's also frequently omitted since the answer is obvious and readily available/forthcoming. Not so with pretty much anything blockchain. So yeah, if a technology is a solution in search of a problem for ten years, that's gonna come…

It reflects a profound level of ignorance which over time feels more like gas lighting than any real attempt to understand what the industry is about.

- provably fair gambling, lotteries, etc (otherwise vulnerable to selective scamming)

- p2p asset exchange without centralised deposits (otherwise vulnerable to theft)

- micro-payments and offchain payments (they help to scale the tech)

- flash loans (instant access to unlimited capital)

- escrow (setting up N-of-M access to funds -- this would require a lawyer in real life and still be unreliable)

- streamable pay rolls (when you sign an employment contract -- you get paid after the first week(s/s/s/s) -- you can stream money to employees over time with smart contracts -- this is genuinely novel)

- automated vesting payouts (again -- most employees have to trust their boss to send whatever vested shares theyre owed. you can setup a smart contract to do this to minimise trust and ensure you will be paid.)

- provably backed derivative contracts of many different types (conventional financial contracts require the assumption that the exchange can actually back up contract values -- with blockchain smart contracts you can setup 100 - N% fully collateralised positions -- 100% transparent. Recall what happened with game stop recently. Robin hood couldn't do shit if it were a DEX.)

there is one final killer use case for the tech and by itself its enough to justify it: decentralised markets. most of you remember silk road as a drug market. But believe it or not silk road was about more than just drugs. it was about having the freedom to trade as you saw fit. taking the good and bad as it came. the website sold books, hosting, and many legitimate products and services. of course -- no one ever gives ulbricht credit for that. silk road was the reason bitcoin had any value in the beginning. today there are many more use-cases though.

Re: Smart Contract Security Field Guide

#83

Post by JumpCrisscross » Thu, Jul 27, 2023, 12:05 AM UTC

csumtin wrote: post #74

JumpCrisscross wrote: post #66

Earlier quoted context omitted.

> we eliminated the risk of bankB running away with money This isn't a real risk with correspondent banks. Instead, it's counterparty risk: bankB failing while it holds the funds in transfer. That risk can be mitigated with smart contracts, but it's not eliminated. (Correspondent banks also take a portion of the client bank's fraud and AML risk.)

I think the bank failing risk is eliminated, if it fails the forwarded payment is unlocked so bankA gets their money back.

> think the bank failing risk is eliminated, if it fails the forwarded payment is unlocked so bankA gets their money back

Bank failing in this context would be the bridge (EDIT: contract) gets hacked. Hence mitigated, but not eliminated.

Re: Smart Contract Security Field Guide

#84

Post by pests » Thu, Jul 27, 2023, 12:06 AM UTC

Uptrenda wrote: post #57

duxup wrote: post #27

Can someone give me a good use case (even better if you're doing it yourself) for a smart contract? What is anyone doing with them that they find really handy? I've never been able to understand how it gets used / why you would use smart contracts. I've googled and read... still don't grok it. I've seen so many "benefits" listed, but none make sense to me as far as the process you go through and how it works out in t…

I find posts like this honestly infuriating because its like you don't know the first thing about an entire, specialized field, yet because its something taking place in tech you feel like you're qualified to write about it. Ask the same question about chemistry, biology, electrical engineering, or any STEM subject, and here's the actual answer: it's beyond the scope of a comment on hacker news to spoon feed you an e…

Yet knowing a lot about crypto and blockchain, thinking about what works and doesn't, and over years reading papers and understanding the technology...

I can not think of a single usable problem that blockchain solves.

Re: Smart Contract Security Field Guide

#85

Post by RcouF1uZ4gsC » Thu, Jul 27, 2023, 12:08 AM UTC

soulofmischief wrote: post #80

duxup wrote: post #27

Can someone give me a good use case (even better if you're doing it yourself) for a smart contract? What is anyone doing with them that they find really handy? I've never been able to understand how it gets used / why you would use smart contracts. I've googled and read... still don't grok it. I've seen so many "benefits" listed, but none make sense to me as far as the process you go through and how it works out in t…

Governance of next-generation automated economies and societies. It's one thing to make a promise to someone. It's another to marry your business procedures directly to immutable code which guarantees to users, employees and partners that the business operates in the intended and described way. Most of these benefits require your company to be digital in nature, but many asset-based economic systems can benefit from…

> For example, automatic, trustless guarantee of both quality of transport and payment for shipping goods.

I am very, very skeptical your example would work purely with smart co tracts for this.

I can think of a bunch of ways where real world interactions would cause all sorts of problems that would have to be sorted out by regular contract law.

Re: Smart Contract Security Field Guide

#86

Post by photonthug » Thu, Jul 27, 2023, 12:08 AM UTC

hn_throwaway_99 wrote: post #49

photonthug wrote: post #40

Earlier quoted context omitted.

Escrow is the simple thing. Suppose you want to buy a house or a car, and you show up with a bag of money and someone else shows up with a set of keys. How to proceed without the transaction requiring trust between people who don't know each other? If you physically get the car/house/keys, what guarantees that title was transferred as expected? Depending on the cash volume and the jurisdiction, there is basically no…

OK, great example, so I'll explain why a smart contract couldn't work here at all. So, to start, going to be clear I'm using your specific example of "escrowing funds on purchase of a piece of real estate (and I mean actual, real, real estate)". Simple enough. But, at the end of the day, who is to say "the keys you gave me are really the keys to the house you said you sold me"? That is, there needs to be some way to…

> There is no real way to do that without some sort of oracle, and then you've just moved the problem back a step (i.e. you need to trust the oracle).

Sure, and of course this is desirable. The "oracle" is a trusted external API (the bank, the DMV, the municipality, whatever). Some people may not like that these institutions are the arbiter of ownership or whatever, but of course we expect to be able to trust these institutions more so than strangers from craigslist.

I haven't mentioned anything about "digital keys" to the house, or "titles on blockchain", or the US specifically, you brought up all that and then argued against it. Honestly, I'm not really a crypto-bro, just a guy who's had trouble with exactly this kind of transaction. And I'm not personally invested in ideals like radical decentralization, or implementation details like super pure smart-contract ecosystems that disallow external oracles. I just want less friction AND less risk when I'm trying to buy a motorcycle on craigslist, or a house in an arbitrary (i.e. potentially non-US) jurisdiction.

Re: Smart Contract Security Field Guide

#87

Post by theK » Thu, Jul 27, 2023, 12:09 AM UTC

duxup wrote: post #27

Can someone give me a good use case (even better if you're doing it yourself) for a smart contract? What is anyone doing with them that they find really handy? I've never been able to understand how it gets used / why you would use smart contracts. I've googled and read... still don't grok it. I've seen so many "benefits" listed, but none make sense to me as far as the process you go through and how it works out in t…

I am building an incentivized market to keep data available on the web(3) without having a centralized entity taking care of it. Without a smart contract running on a block chain this isn't possible. https://permanentum.io

Re: Smart Contract Security Field Guide

#88

Post by bgitarts » Thu, Jul 27, 2023, 12:10 AM UTC

hn_throwaway_99 wrote: post #49

photonthug wrote: post #40

Earlier quoted context omitted.

Escrow is the simple thing. Suppose you want to buy a house or a car, and you show up with a bag of money and someone else shows up with a set of keys. How to proceed without the transaction requiring trust between people who don't know each other? If you physically get the car/house/keys, what guarantees that title was transferred as expected? Depending on the cash volume and the jurisdiction, there is basically no…

OK, great example, so I'll explain why a smart contract couldn't work here at all. So, to start, going to be clear I'm using your specific example of "escrowing funds on purchase of a piece of real estate (and I mean actual, real, real estate)". Simple enough. But, at the end of the day, who is to say "the keys you gave me are really the keys to the house you said you sold me"? That is, there needs to be some way to…

I guess you could say you don't need Amazon, the problem of getting goods is solved by physical stores. Yet, millions of people find value in ordering through Amazon instead.

There will be use cases where people simply prefer blockchain over the legacy alternatives because it's cheaper, faster or better and there will be "whole new world" use cases.

Re: Smart Contract Security Field Guide

#89

Post by bgitarts » Thu, Jul 27, 2023, 12:14 AM UTC

pests wrote: post #84

Uptrenda wrote: post #57

Earlier quoted context omitted.

I find posts like this honestly infuriating because its like you don't know the first thing about an entire, specialized field, yet because its something taking place in tech you feel like you're qualified to write about it. Ask the same question about chemistry, biology, electrical engineering, or any STEM subject, and here's the actual answer: it's beyond the scope of a comment on hacker news to spoon feed you an e…

Yet knowing a lot about crypto and blockchain, thinking about what works and doesn't, and over years reading papers and understanding the technology... I can not think of a single usable problem that blockchain solves.

How about stopping governments and banks from censoring, stopping and freezing money of their citizens/customers? Seems like one good use case.

Re: Smart Contract Security Field Guide

#90

Post by RcouF1uZ4gsC » Thu, Jul 27, 2023, 12:14 AM UTC

Uptrenda wrote: post #57

duxup wrote: post #27

Can someone give me a good use case (even better if you're doing it yourself) for a smart contract? What is anyone doing with them that they find really handy? I've never been able to understand how it gets used / why you would use smart contracts. I've googled and read... still don't grok it. I've seen so many "benefits" listed, but none make sense to me as far as the process you go through and how it works out in t…

I find posts like this honestly infuriating because its like you don't know the first thing about an entire, specialized field, yet because its something taking place in tech you feel like you're qualified to write about it. Ask the same question about chemistry, biology, electrical engineering, or any STEM subject, and here's the actual answer: it's beyond the scope of a comment on hacker news to spoon feed you an e…

> Ask the same question about chemistry, biology, electrical engineering, or any STEM subject,

The blockchain is less like these and more like Astrology and Palm Reading.