Bitcoin discussion and news

[Storm Fox]

On a general forum such as this, do you expect us to start at the deep end explaining all of this, or in it's simplist forms?

If we are advocating blokchain technology to normal run of the mill people, then we're not going to show them out enterprises use blockchain, we are going to show them how people would.

So getting back to what regular people would use them for, what anyone who is all for postive social change would like them to use it for, is DAOs that would functional a lot like an unincorporated association.

In those scenarios there would not be legal agreements left right and centre.

Oh an even in the enterprise setups, it cuts down on the legal paperwork.

Are you saying it's no good or too complicated for business-to-business use and only good for person-to-person use? But most people who are in a position to exchange things trust each other enough not to need formal contracts. Plus there is even more scope for unforeseen circumstances.

Alice has a smart contract to lend Bob fifty quid until the end of the week. Bob's oven stops working Thursday night. Come Friday morning With a Smart Contract, Bob is now Fifty quid in a hole plus needs a new oven. In the real world, Bob would phone Alice, Alice would defer the loan until Bob has his oven and would probably help him find one.

 

[NoXion]

Are you saying it's no good or too complicated for business-to-business use and only good for person-to-person use? But most people who are in a position to exchange things trust each other enough not to need formal contracts. Plus there is even more scope for unforeseen circumstances.

I'm not sure what smart contracts are supposed to add even in the use-case of business operations. It just seems to add another layer of expense and complication; not only do you still need to have lawyers on retainer to check through the legal implications of the contract itself, but now you also need to pay programmers to check if the code is working as intended. Why, why why?

 

[moochedit]

I'm not a lawyer but isn't there such a thing in law as a "verbal contract"? (Obviously you would need witnesses to prove who said what).

 

[NoXion]

I'm not a lawyer but isn't there such a thing in law as a "verbal contract"? (Obviously you would need witnesses to prove who said what).

London Law Practice certainly seems to think so.

 

[Rob Ray]

There is, and it's entirely as legally binding as a written contract unless you say it isn't, in which case they apologise and escort you out of the court while setting fire to any wigs which happen to be lying around.

 

[Storm Fox]

I'm not sure what smart contracts are supposed to add even in the use-case of business operations. It just seems to add another layer of expense and complication; not only do you still need to have lawyers on retainer to check through the legal implications of the contract itself, but now you also need to pay programmers to check if the code is working as intended. Why, why why?

Rhetorical question: What's the point of them?

Business-to-Business is too complex.
Business-to-customer, most countries have laws to cover this
Person-to-person. Have some trust in your fellow humans or just write something.

Also, It's all well and good to say someone lends you the money and at the time it's due to be paid back the wallet is empty. Are we back to hiring Big Rob to get the money back?

 

[littlebabyjesus]

Also, It's all well and good to say someone lends you the money and at the time it's due to be paid back the wallet is empty. Are we back to hiring Big Rob to get the money back?

Yes, this bit puzzles me. If I lend you one bitcoin and you set up a smart contract to pay me one bitcoin in one year's time, the only way the smart contract can guarantee that it can fulfil its job is by ensuring that at least one bitcoin remains in your wallet for the whole year.

That's rather pointless.

the idea that it might not be pointless appears to rest on a fundamental misunderstanding of the function of money, which is to circulate.

 

[mojo pixy]

A smart contract isn't a legal contract unless it's mentioned in a legal contract.

I've already outlined all the layers in this.

If you are going to argue about something in isolation, let's argue about about it in isolation.

A smart contract is a load of code the results of which are computed by thousands of computers. You don't know who wrote the smart contract.

Step away from that and we start talking about the websites that promote smart contracts and things can change, or not depending on what they do.

Criminal law is different. If a smart contract somehow breaks criminal law (It's bloody hard to, it's got to be tied to something blatently criminal such as a web3 website that incites violence/terrorism for example) then that is a differnt matter in which a government would be starting a man hunt.

Criminal law is irrelevant. If a contract is poorly worded or obviously unfair or coercive or for any number of other reasons it may be unenforceable under contract law. Contract lawyers are among the best paid lawyers there are, in part because contract law is eye-wateringly complex. Your hand waving doesn't change a thing.

 

[moochedit]

If i set up a standing order with my bank to pay someone else £X on a future date, i can cancel it before the date if i change my mind. Even if I set up a direct debit (where the other party sends the instruction to the bank to debit my account) i can cancel the DD mandate.

Can you cancel a "smart contract"?

 

[Cid]

So only lawyers know what a fucking legal contract is? You're fucking mad!

What next? I need to be a vet or choclatier to tell the differnce between a bar of Topic and pile of squirrel shit?!!

Woooow...

You definitely need to be a vet to tell if Fido's got the shits or has stomach cancer.

So with a contract you may 'know one when you see one' but you sure as fuck don't know where that line is drawn. All you need for a contract is an offer, acceptance of that offer and consideration (some promise/action etc). I don't know the details of course, because how that would all play out wrt a smart contract is probably fairly complex, and I haven't read up on whether there's any litigation history.

 

[moochedit]

Yes, this bit puzzles me. If I lend you one bitcoin and you set up a smart contract to pay me one bitcoin in one year's time, the only way the smart contract can guarantee that it can fulfil its job is by ensuring that at least one bitcoin remains in your wallet for the whole year.

That's rather pointless.

So it "bounces" like a cheque, standing order or direct debit? I assume you can't go "overdrawn" in crypto

 

[BigTom]

So it's like a "standing order" that you can set up with your bank?

being serious for a moment, no.
It's an escrow service. In order to enter into the smart contract I've set out, Kabbes would need to put £1 into the contract, which would then payout to stakerone as soon as the conditions of the contract are met, in this case that the calendar oracle has told us that it's tomorrow.

I don't think you could setup something like a standing order/direct debit using trustless unbreakable smart contracts because (a) you can't setup something indefinite with no way to break or end it unilaterally and (b) it's not trustless if you can leave it with a wallet with no funds to draw on, which could be the case with anything that you setup on an ongoing basis that has to draw out of your wallet automatically. Any money being transferred by a smart contract must treat the smart contract as an escrow service and place that money into the contract at the time of inception.
So it would mean a new contract every month and a whole lot more admin. You might as well be making manual transfers.

 

[BigTom]

and oh yeah I've been meaning to make this for a while with the praise for airdrops:



Remember people in the wonderful world of cryptopia, airdrops can happen all the time and we can all be rich!

 

[Storm Fox]

being serious for a moment, no.
It's an escrow service. In order to enter into the smart contract I've set out, Kabbes would need to put £1 into the contract, which would then payout to stakerone as soon as the conditions of the contract are met, in this case that the calendar oracle has told us that it's tomorrow.

I don't think you could setup something like a standing order/direct debit using trustless unbreakable smart contracts because (a) you can't setup something indefinite with no way to break or end it unilaterally and (b) it's not trustless if you can leave it with a wallet with no funds to draw on, which could be the case with anything that you setup on an ongoing basis that has to draw out of your wallet automatically. Any money being transferred by a smart contract must treat the smart contract as an escrow service and place that money into the contract at the time of inception.
So it would mean a new contract every month and a whole lot more admin. You might as well be making manual transfers.

Thanks, that makes sense, but also seems to further limit Smart Contracts' application.

 

[littlebabyjesus]

So it "bounces" like a cheque, standing order or direct debit? I assume you can't go "overdrawn" in crypto

Yeah, it's clearly no good for simple loans.

I could see how a SC might work where you contract someone to do a piece of work for you and have some mechanism agreed between the two of you whereby once the work has been completed correctly, some button is pressed and payment is made by the SC.

But you have a similar problem even there. It means you need to have all your financing of the work sorted at the point of making the contract. With long-term projects, that isn't the case in the real world. And in any case, if I've got 10 grand that I need to pay you in six months' time, I'd be sensible putting it into a savings account and getting a bit of interest, but you can't do that and guarantee the SC will be fulfilled - cos the money can't be circulating during the SC period.

I'm struggling to identify a scenario in which this is a good idea.

 

[littlebabyjesus]

The other real-world problem is that shit happens.

Sometimes you have to break a legally binding contract cos, you know, you need to eat or clothe your kid or bury your mother, or something.

 

[BigTom]

Thanks, that makes sense, but also seems to further limit Smart Contracts' application.

Yes but i don't think this is the only type of thing you can do with a smart contract, although ultimately they must all involved moving tokens on a blockchain because what else is there for them to do?

The question then becomes what else you can do by moving tokens on a blockchain.

 

[Rob Ray]

Play a really complicated game of Risk?

 

[Monkeygrinder's Organ]

The other real-world problem is that shit happens.

Sometimes you have to break a legally binding contract cos, you know, you need to eat or clothe your kid or bury your mother, or something.

Fuck you, pay me.

 

[Storm Fox]

Fuck you, pay me.

'And here we have the mating call of the Libertarian or Anarcho-Capitalist and known by some a massive wanker as they expose and exaggerate their massive Crypto-wallet'

 

[moochedit]

being serious for a moment, no.
It's an escrow service. In order to enter into the smart contract I've set out, Kabbes would need to put £1 into the contract, which would then payout to stakerone as soon as the conditions of the contract are met, in this case that the calendar oracle has told us that it's tomorrow.

I don't think you could setup something like a standing order/direct debit using trustless unbreakable smart contracts because (a) you can't setup something indefinite with no way to break or end it unilaterally and (b) it's not trustless if you can leave it with a wallet with no funds to draw on, which could be the case with anything that you setup on an ongoing basis that has to draw out of your wallet automatically. Any money being transferred by a smart contract must treat the smart contract as an escrow service and place that money into the contract at the time of inception.
So it would mean a new contract every month and a whole lot more admin. You might as well be making manual transfers.

Ok thanks for that. I must admit i haven't fully got my head round the "smart contract" concept, but that makes it a bit clearer.

 

[StakerOne]

and oh yeah I've been meaning to make this for a while with the praise for airdrops:

View attachment 340735

Remember people in the wonderful world of cryptopia, airdrops can happen all the time and we can all be rich!

There are good airdrops and bad ones.

Good airdrops (or at least an example of a good airdrop) is when a project that has loads of money in it's treasury, wants to further decentralise with a governance token.

That is a true Robin Hood wonder to behold because everyone gets an equal or similar share of the airdrop, not just the people who used the project a lot.

For example, someone who used Uniswap or Optimism a lot, would have gotten a similar amount of tokens compared to someone who used it a little.

That meant that people who simply used a product, spending just a few quid on transaction fees, wound up being rewarded with thousands of pounds.

This is why, if you scroll back through this thread, I've been telling you all over and over and over again, to just get involved, don't speculate money on the thing, to just use it.

The rest will follow and for the sake of a few hundred quid, you can wind up being rewarded with airdrops worth thousands.

I would know. Last year for me, I got over £30,000 in airdrops and the money that I actually spent to get that was chicken feed, certainly less than £50.00

This is what makes me laugh with some of you people. You clearly know nothing about the way the industry works. You claim it's wall to wall with hyper-capitalist scum, but the reality is there is no sector that redistributes wealth like the crypto sector does.

 

[StakerOne]

Woooow...

You definitely need to be a vet to tell if Fido's got the shits or has stomach cancer.

So with a contract you may 'know one when you see one' but you sure as fuck don't know where that line is drawn. All you need for a contract is an offer, acceptance of that offer and consideration (some promise/action etc). I don't know the details of course, because how that would all play out wrt a smart contract is probably fairly complex, and I haven't read up on whether there's any litigation history.

But that would be the same in any other sector, including opensource software.

 

[Cid]

But that would be the same in any other sector, including opensource software.

Yep. I would advise against making open source software that handles financial transactions unless you really know what you're doing.

To be clear I don't know what kind of contracts these would generate, I guess, bouncing off BigTom 's post, courts would probably look to law established around things like escrow contracts... where there isn't specific legislation, the law tends to work by analogy. But there certainly are contracts there to be litigated. I'd very much like to be one of the lawyers involved in that, because it sounds extremely expensive.

 

[StakerOne]

Rhetorical question: What's the point of them?

Business-to-Business is too complex.
Business-to-customer, most countries have laws to cover this
Person-to-person. Have some trust in your fellow humans or just write something.

Also, It's all well and good to say someone lends you the money and at the time it's due to be paid back the wallet is empty. Are we back to hiring Big Rob to get the money back?

Business-to-business - there is an entire protocol called Baseline that sits on top of Ethereum that Microsoft invented then opensourced and it's whole purpose is to facilitate B2B activity.

Chainlink who are the biggest provider of smart contract oracles, have loads of partnerships with the corporates and they are currently working on the BIS for a backend clearing system based on blockchains.

VISA & Mastercard are trialling it for settlements, but considering that VISA can faciliate USDC from customer to merchant, that's 100% customer >> VISA >> to business. VISA are developing their own blockchain to sit on top of Ethereum as a layer 2.

All of the major auditing firms out there are encouraging their firms to go down the blockchain route, because unlike conventional systems, with blockchain, it's possible to audit an entire firm within seconds, because the data is standardised, is immutable and above all else reliable - which cuts out fraud and saves firms millions.

EDIT TO ADD : Person-to-person - try telling that to people who've been ripped off.

 

[StakerOne]

Yep. I would advise against making open source software that handles financial transactions unless you really know what you're doing.

To be clear I don't know what kind of contracts these would generate, I guess, bouncing off BigTom 's post, courts would probably look to law established around things like escrow contracts... where there isn't specific legislation, the law tends to work by analogy. But there certainly are contracts there to be litigated. I'd very much like to be one of the lawyers involved in that, because it sounds extremely expensive.

They ignored your advice and now blockchains handle trillions in assets.

 

[Cid]

They ignored your advice and now blockchains handle trillions in assets.

I'm gonna hazard a guess that they did not.

 

[StakerOne]

Borrowing and lending in crypto - There seems to be a lot of confusion around this subject.

At the moment, borrowing and lending works with collateral only in the form of assets AND OR flashloans. <<<< EDIT TO ADD I worded this badly. Corrected.

The more "conventional" way of borrowing money is putting up colateral with a smart contract. Don't like the way it works? Don't do it!

The second is flashloans, which are good for borrowing money, to buy low, to sell high, repay back the loan and keep the profit. There are issues with flashloans around MEV but that is a growing pain of the technology and that will be fixed so that people can't exploit the memepool. At least in the crypto world, when someone is being naughty, it can be spotted quickly and we all know about it. In closed centralised systems, it could take a yearly audit or a whistleblower before people find out they have been cheated.

Back to loans, there isn't yet a good system to repay loans on Trust. This however is being worked on. AAVE for example are working on this.

Blockchain / smart contract detractors also keep reframing the pro argument for blockchains - you know strawman arguments.

No one here is saying that crypto / blockchains can replace every single type of business operation NOW. It's possible to at some point in the future assuming adoption keeps going in the direction it's going in.

No one is saying that it will cure cancer.

By I do know this, it will change the world for the better.

 

[StakerOne]

I'm gonna hazard a guess that they did not.

?

 

[StakerOne]

If i set up a standing order with my bank to pay someone else £X on a future date, i can cancel it before the date if i change my mind. Even if I set up a direct debit (where the other party sends the instruction to the bank to debit my account) i can cancel the DD mandate.

Can you cancel a "smart contract"?

Typically in this situation one smart contract would be working will multiple "Direct Debits" or reouccring payments, so you're question in that form isn't kinda relevant. It really depends on how well the smart contract is done to match what you really want it to do.