Dumb contracts
January 18, 2018 3:07 AM Subscribe
"In the real world, contracts have social utility, and people use them in complex, strategic ways that often don’t align with their legal rights and obligations. These social functions require flexibility—often, the very flexibility that is intentionally short-circuited by smart contracts." Karen E. C. Levy discusses the limitations of smart contracts in her paper Book-Smart, Not Street-Smart: Blockchain-Based Smart Contracts and The Social Workings of Law (PDF).
David Gerard likes to point out that there's already a very famous pop culture example of a smart contract, and it's the doomsday device from Dr. Strangelove.
posted by Pope Guilty at 4:41 AM on January 18, 2018 [21 favorites]
posted by Pope Guilty at 4:41 AM on January 18, 2018 [21 favorites]
Sometimes, merely having lawyers involved in a negotiation makes the contract too smart.
posted by Obscure Reference at 5:36 AM on January 18, 2018 [1 favorite]
posted by Obscure Reference at 5:36 AM on January 18, 2018 [1 favorite]
Smart contracts are showing up in ransomware now.
posted by oceanjesse at 5:37 AM on January 18, 2018 [2 favorites]
posted by oceanjesse at 5:37 AM on January 18, 2018 [2 favorites]
There is indeed a universe of contracts that are, and we want them be, mechanistically enforced, for example financial derivative and consumer credit contracts, where inflexible / literal interpretation makes it possible to enter into them in large quantities, low cost, and for the resulting instrument to be tradable and pledgeable (i.e., you can borrow on it).
(There's an ongoing drama in the world of credit derivatives where they are being enforced mechanistically and literally and certain counterparties are losing tens or hundreds of millions of dollars because they assumed that there was some underlying "intention" that should drive a contrary case-by-case interpretation.) (The body that applies them is quite literally called the "Determination Committee" not the "Interpretation Committee"!)
posted by MattD at 5:40 AM on January 18, 2018 [4 favorites]
(There's an ongoing drama in the world of credit derivatives where they are being enforced mechanistically and literally and certain counterparties are losing tens or hundreds of millions of dollars because they assumed that there was some underlying "intention" that should drive a contrary case-by-case interpretation.) (The body that applies them is quite literally called the "Determination Committee" not the "Interpretation Committee"!)
posted by MattD at 5:40 AM on January 18, 2018 [4 favorites]
That sounds interesting, MattD. Is there any writeup of what's going on that you happen to know about?
Looking back at my younger self - and a younger relative now who resembles me a bit - I'm seeing how much my appreciation for clear rules was driven by fear. I didn't feel fear, but my world got smaller and smaller because I was so good at avoiding anything that produced fear. I felt comfortable.
Smart contracts would've made me feel comfortable. No uncertainty. No need to deal with the messiness of relationships and the complications of other people. This is what the contract says will happen, so this is what will happen.
My life is less comfortable now, but it's also a bit bigger. There's more uncertainty and discomfort in it. My contracts - in the general sense - aren't so smart, but they're more real.
posted by clawsoon at 6:03 AM on January 18, 2018 [9 favorites]
Looking back at my younger self - and a younger relative now who resembles me a bit - I'm seeing how much my appreciation for clear rules was driven by fear. I didn't feel fear, but my world got smaller and smaller because I was so good at avoiding anything that produced fear. I felt comfortable.
Smart contracts would've made me feel comfortable. No uncertainty. No need to deal with the messiness of relationships and the complications of other people. This is what the contract says will happen, so this is what will happen.
My life is less comfortable now, but it's also a bit bigger. There's more uncertainty and discomfort in it. My contracts - in the general sense - aren't so smart, but they're more real.
posted by clawsoon at 6:03 AM on January 18, 2018 [9 favorites]
Looking back at my younger self - and a younger relative now who resembles me a bit - I'm seeing how much my appreciation for clear rules was driven by fear.
This is a wonderful insight. I know a lot of people from my early, very much evangelical and conservative, life who I wish I could give it to.
posted by gauche at 6:11 AM on January 18, 2018 [6 favorites]
This is a wonderful insight. I know a lot of people from my early, very much evangelical and conservative, life who I wish I could give it to.
posted by gauche at 6:11 AM on January 18, 2018 [6 favorites]
In practice, smart contracts mean that dumb mistakes in contract code mean that the first one to see and exploit the mistake can have your stuff. Or, simply make it so that your stuff disappears.
I'd dispute the language of "theft" in that first link. The system says that the contract is defined by what the code does, not what the author intended it to do. The willingness to reset the whole system rather than follow through shows that the people running it value other people's money more than they trust the system they want people to put money into. As someone who writes programs for a living, I find the idea of non negotiable legally binding bugs to be frightening.
posted by idiopath at 6:20 AM on January 18, 2018 [14 favorites]
I'd dispute the language of "theft" in that first link. The system says that the contract is defined by what the code does, not what the author intended it to do. The willingness to reset the whole system rather than follow through shows that the people running it value other people's money more than they trust the system they want people to put money into. As someone who writes programs for a living, I find the idea of non negotiable legally binding bugs to be frightening.
posted by idiopath at 6:20 AM on January 18, 2018 [14 favorites]
Smart contracts would've made me feel comfortable. No uncertainty. No need to deal with the messiness of relationships and the complications of other people. This is what the contract says will happen, so this is what will happen.Or at least what you think will happen based on some else’s description. Most people aren’t going to be able to reason about the code in a smart contract or prove that its code is bug free, and the most common designs mean that correcting errors is difficult and requires the cooperation of all parties since there’s no third-party involved to say that a clause is enforceable or agree that someone is acting in bad faith.
posted by adamsc at 6:21 AM on January 18, 2018 [5 favorites]
mystyk: I get the feeling that this was almost purpose-written to address the recent scenario of the "fling" app for granting sexual consent by smart contract.
I think the paper is older than the legalfling app - the app appears to be less than a month old, while Levy's paper is from 2017 - but I agree that the paper is exactly on-point for the app. Sexual consent is full of human complication and messiness and moment-by-moment decision-making, and that makes it a site of fear for those of us liable to be frightened by human complication. Lay your fear upon the blockchain - fear of untrustworthy institutions and uncertain partners - and maybe you'll be able to get what you want without having to face fear. Maybe the blockchain will make the rest of world as comfortable and safe as the little bubble you've created for yourself.
posted by clawsoon at 6:25 AM on January 18, 2018 [1 favorite]
I think the paper is older than the legalfling app - the app appears to be less than a month old, while Levy's paper is from 2017 - but I agree that the paper is exactly on-point for the app. Sexual consent is full of human complication and messiness and moment-by-moment decision-making, and that makes it a site of fear for those of us liable to be frightened by human complication. Lay your fear upon the blockchain - fear of untrustworthy institutions and uncertain partners - and maybe you'll be able to get what you want without having to face fear. Maybe the blockchain will make the rest of world as comfortable and safe as the little bubble you've created for yourself.
posted by clawsoon at 6:25 AM on January 18, 2018 [1 favorite]
Ten years in, nobody has come up with a use for blockchain
One of the things I've tried to preach to non-technical friends and family for years is that computer algorithms have moral and legal implications. Most of them gave me a shrug in response, to the point where I started feeling like a radical over my concerns about voting machines and metadata gathering and Facebook and whatnot. I think the election has started to make some of them understand, but I don't think most of them get it even now.
I get being comforted by the idea of something impersonally rules-driven, certainly, and I think that accounts for the appeal of libertarianism to the engineer and the low-information voter. It's very simple, and that simplicity is comforting. Even so, I'm stunned that anyone who works in any capacity even tangentially related to software development is ever comfortable with the idea that things like money and legal contracts should be software-based. If people really understood how much of their lives (property and money and insurance and and and...) is managed by shitty code, hacks and kludges, they'd have periodic insomnia.
posted by middleclasstool at 6:25 AM on January 18, 2018 [21 favorites]
One of the things I've tried to preach to non-technical friends and family for years is that computer algorithms have moral and legal implications. Most of them gave me a shrug in response, to the point where I started feeling like a radical over my concerns about voting machines and metadata gathering and Facebook and whatnot. I think the election has started to make some of them understand, but I don't think most of them get it even now.
I get being comforted by the idea of something impersonally rules-driven, certainly, and I think that accounts for the appeal of libertarianism to the engineer and the low-information voter. It's very simple, and that simplicity is comforting. Even so, I'm stunned that anyone who works in any capacity even tangentially related to software development is ever comfortable with the idea that things like money and legal contracts should be software-based. If people really understood how much of their lives (property and money and insurance and and and...) is managed by shitty code, hacks and kludges, they'd have periodic insomnia.
posted by middleclasstool at 6:25 AM on January 18, 2018 [21 favorites]
Recent history shows that even the authors of the contract code can't reason about it correctly.
posted by idiopath at 6:27 AM on January 18, 2018 [3 favorites]
posted by idiopath at 6:27 AM on January 18, 2018 [3 favorites]
The PDF link appears to be broken right now, so here's an alternate copy. I assume it's a legit copy, since the paper is Creative Commons licensed.
posted by clawsoon at 6:28 AM on January 18, 2018
posted by clawsoon at 6:28 AM on January 18, 2018
The thing is that with must of that shitty code there's some resort for humans to say "that's a computer error and not what was intended", the idea of making the code a binding authority is psychotic.
posted by idiopath at 6:29 AM on January 18, 2018 [2 favorites]
posted by idiopath at 6:29 AM on January 18, 2018 [2 favorites]
MattD, what's fun is that the system you describe depends fundamentally on the mechanisms of enforcement for the so-called value of said instruments in a way very similar to what the author describes.
As spelled out, e.g. here, attempts to enforce coupon payments purely through a blockchain itself renders the resulting instrument worthless, since guaranteeing payment to the creditor renders these funds unavailable to the debtor, which was supposed to be the entire point. It turns out that the risk of default is the only reason that a debt arrangement is worth anything to anyone to begin with, and that's something (else) that "smart contracts" can't capture.
A similar point is made that, for any smart contract that depends upon external information (e.g. weather events, market conditions, sports outcomes), the trust necessary for any contracting parties to agree upon this information is sufficient to render its implementation via a distributed consensus algorithm entirely superfluous.
posted by 7segment at 6:44 AM on January 18, 2018 [4 favorites]
As spelled out, e.g. here, attempts to enforce coupon payments purely through a blockchain itself renders the resulting instrument worthless, since guaranteeing payment to the creditor renders these funds unavailable to the debtor, which was supposed to be the entire point. It turns out that the risk of default is the only reason that a debt arrangement is worth anything to anyone to begin with, and that's something (else) that "smart contracts" can't capture.
A similar point is made that, for any smart contract that depends upon external information (e.g. weather events, market conditions, sports outcomes), the trust necessary for any contracting parties to agree upon this information is sufficient to render its implementation via a distributed consensus algorithm entirely superfluous.
posted by 7segment at 6:44 AM on January 18, 2018 [4 favorites]
But what if the real cryptocurrency was the consensual relationships we made along the way?
posted by rum-soaked space hobo at 6:47 AM on January 18, 2018 [18 favorites]
posted by rum-soaked space hobo at 6:47 AM on January 18, 2018 [18 favorites]
Now I'm thinking about Paradise By The Dashboard Light.
Stop right there
I gotta know right now
Before we go any further
Do you love me?
Will you love me forever?
Will you put it on the blockchain?
posted by clawsoon at 6:49 AM on January 18, 2018 [1 favorite]
Stop right there
I gotta know right now
Before we go any further
Do you love me?
Will you love me forever?
Will you put it on the blockchain?
posted by clawsoon at 6:49 AM on January 18, 2018 [1 favorite]
As someone said, corporations were the first AIs trying to kill us. Deathless, passionless, inhuman creatures that were given personhood, and now driving the climate system out of control. This seems like the natural iteration. Human institutions with no regard for human negotiation.
posted by eustatic at 6:51 AM on January 18, 2018 [9 favorites]
posted by eustatic at 6:51 AM on January 18, 2018 [9 favorites]
It's been said that most tech-bro ideas stem from the fact that their mother no longer makes their bed or cooks breakfast, so they created an app to get that stuff done so they don't have to learn social skills or how to cook food.
This horrible idea is the next bad idea from these guys.
posted by Pirate-Bartender-Zombie-Monkey at 7:58 AM on January 18, 2018 [8 favorites]
This horrible idea is the next bad idea from these guys.
posted by Pirate-Bartender-Zombie-Monkey at 7:58 AM on January 18, 2018 [8 favorites]
It’s the fault tolerance of contracts that make them useful. If you find a misprint in the contract, you can’t use it as a loophole to wiggle your way out. If you were ever to agree to the contract under duress, then the contract can be voided. Unexpected contingencies can be arbitrated.
It looks like there’s basically a limit to the level of complexity that a smart contract can enforce. Most importantly, all the conditions and activities of a smart contract must be contained entirely within the smart contract environment. It can never depend on anyone whose activities are outside of the blockchain. That’s perfect for exchanging a cryptocurrency that exists entirely internally. It’s not so useful for enforcing agreements for conditions that are not dependent on a blockchain.
I suppose smart contracts can enforce a middle layer of a workflow, passing information between parts of a workflow that are entirely digital. But at some point, there is a physical, meatspace condition that has to be met outside the blockchain to complete the loop. That puts us back to the original problem of using human contracts to enforce agreements and trust of known entities.
posted by deanc at 8:42 AM on January 18, 2018 [5 favorites]
It looks like there’s basically a limit to the level of complexity that a smart contract can enforce. Most importantly, all the conditions and activities of a smart contract must be contained entirely within the smart contract environment. It can never depend on anyone whose activities are outside of the blockchain. That’s perfect for exchanging a cryptocurrency that exists entirely internally. It’s not so useful for enforcing agreements for conditions that are not dependent on a blockchain.
I suppose smart contracts can enforce a middle layer of a workflow, passing information between parts of a workflow that are entirely digital. But at some point, there is a physical, meatspace condition that has to be met outside the blockchain to complete the loop. That puts us back to the original problem of using human contracts to enforce agreements and trust of known entities.
posted by deanc at 8:42 AM on January 18, 2018 [5 favorites]
You know there were some fantastic chemical products that made life so much better in the 20th Century. Just look at tetraethyl lead. What a wonderful chemical, it made inexpensive high octane gasoline possible and facilitated the radical transformation of our civilization to the utopia we live in today!
posted by Pembquist at 9:16 AM on January 18, 2018 [1 favorite]
posted by Pembquist at 9:16 AM on January 18, 2018 [1 favorite]
There is indeed a universe of contracts that are, and we want them be, mechanistically enforced, for example ....consumer credit contracts
Given the immense disparities in power, information, and capacity to enforce in most consumer credit contracts, mechanistic enforcement is actually not something we want.
This paper's been cued up in my to-read for a couple of days, but just from the snippets, it sounds magnificently on point. Every once in a while I go a couple of rounds on Twitter with people who clearly have no idea how contracts actually function in the business world to try to explain these problems, but since I use a female name on Twitter it usually ends up being more grief than it's worth. (There's an amazing overlap between smart-contract enthusiasts and men who think their reasoning from first principles outweighs the actual experience of a girl who's merely worked on billion-dollar contract litigations...)
posted by praemunire at 9:18 AM on January 18, 2018 [9 favorites]
Given the immense disparities in power, information, and capacity to enforce in most consumer credit contracts, mechanistic enforcement is actually not something we want.
This paper's been cued up in my to-read for a couple of days, but just from the snippets, it sounds magnificently on point. Every once in a while I go a couple of rounds on Twitter with people who clearly have no idea how contracts actually function in the business world to try to explain these problems, but since I use a female name on Twitter it usually ends up being more grief than it's worth. (There's an amazing overlap between smart-contract enthusiasts and men who think their reasoning from first principles outweighs the actual experience of a girl who's merely worked on billion-dollar contract litigations...)
posted by praemunire at 9:18 AM on January 18, 2018 [9 favorites]
Smart contracts built on an even-worse-javascript, deployed in the blockchain, are a pretty terrible idea. But I understand the appeal: courts only really work as a contract resolution mechanism between approximately equal parties, yet now the majority of contracts are between entities with huge power imbalances. We live in a time where, if as an individual, you have an agreement violated by a corporation, you're more likely to find restitution by taking your grievances to social media than to court (if you're even allowed to go to court instead of binding arbitration).
Just as cryptocurrencies tap in to a lack of faith in the financial system, smart contracts tap into a lack of faith in the courts.
posted by Pyry at 9:25 AM on January 18, 2018 [5 favorites]
Just as cryptocurrencies tap in to a lack of faith in the financial system, smart contracts tap into a lack of faith in the courts.
posted by Pyry at 9:25 AM on January 18, 2018 [5 favorites]
I don't think the lack of faith in the courts implicit in smart contracts is usually due to any kind of significant kind of consciousness of systematic imbalances of power in the operation of justice. I mean, fill in some generic rhetoric about corruption, sure, but to suggest that this means you wouldn't win in the courts would imply that You, a Heroic Genius-Nerd, do not have complete personal autonomy and agency. Rather, it's driven by a conviction that Everyone Else Is Stupid, including judges and juries, and so can't be trusted to reach the correct outcome when interpreting a contract. (Note required subfaith that there will always be a clear Correct Outcome in interpreting a contract, and it will be the one favoring you.)
posted by praemunire at 10:01 AM on January 18, 2018 [1 favorite]
posted by praemunire at 10:01 AM on January 18, 2018 [1 favorite]
Smart contracts are showing up in ransomware now.
Huh. This might be the single sensible use of smart contracts I've seen. It solves the oracle issue in that everything is digital, that is, the ransomware publishes that the computer was encrypted, then the key is in escrow until the blockchain payment is made (which is how payment was often being handled anyway).
Granted, this is just externalizing payment processing to miners ("THE CLOUD!"), and doesn't solve any trust issues, and isn't making any new developments in, like, e-commerce or anything, but hey, given the state of blockchains, this one use actually makes sense.
posted by Nonsteroidal Anti-Inflammatory Drug at 10:04 AM on January 18, 2018 [3 favorites]
Huh. This might be the single sensible use of smart contracts I've seen. It solves the oracle issue in that everything is digital, that is, the ransomware publishes that the computer was encrypted, then the key is in escrow until the blockchain payment is made (which is how payment was often being handled anyway).
Granted, this is just externalizing payment processing to miners ("THE CLOUD!"), and doesn't solve any trust issues, and isn't making any new developments in, like, e-commerce or anything, but hey, given the state of blockchains, this one use actually makes sense.
posted by Nonsteroidal Anti-Inflammatory Drug at 10:04 AM on January 18, 2018 [3 favorites]
I also think this article doesn't always make the best case for why certain aspects of normal contracts are actually good. For example, in the section arguing that unenforceable clauses are in fact a beneficial feature of contracts:
For instance, residential leases often contain clauses that are unenforceable under state landlord/tenant law; employment contracts frequently contain post-employment non-compete clauses, which are commonly executed despite the fact that state laws often make those clauses unenforceable(Sullivan 2009). [...]
The inclusion of unenforceable clauses in contracts of adhesion may strike us as unfair to the unsavvy contracting party, whose lack of sophisticated legal knowledge operates as a barrier to her rights, and operates to ascribe ever more influence to the more powerful contracting party (cf. Galanter 1974).
The article goes on to list what it considers to be good unenforceable clauses, namely college speech codes that violate the first amendment, and “infidelity clauses” in prenuptial agreements. Leaving aside the dubious value of infidelity clauses, on one hand we have (as the article agrees) largely symbolic college speech codes, and on the other we have the very real and widespread harm caused by unenforceable lease terms and non-compete clauses.
posted by Pyry at 10:05 AM on January 18, 2018 [2 favorites]
For instance, residential leases often contain clauses that are unenforceable under state landlord/tenant law; employment contracts frequently contain post-employment non-compete clauses, which are commonly executed despite the fact that state laws often make those clauses unenforceable(Sullivan 2009). [...]
The inclusion of unenforceable clauses in contracts of adhesion may strike us as unfair to the unsavvy contracting party, whose lack of sophisticated legal knowledge operates as a barrier to her rights, and operates to ascribe ever more influence to the more powerful contracting party (cf. Galanter 1974).
The article goes on to list what it considers to be good unenforceable clauses, namely college speech codes that violate the first amendment, and “infidelity clauses” in prenuptial agreements. Leaving aside the dubious value of infidelity clauses, on one hand we have (as the article agrees) largely symbolic college speech codes, and on the other we have the very real and widespread harm caused by unenforceable lease terms and non-compete clauses.
posted by Pyry at 10:05 AM on January 18, 2018 [2 favorites]
Invest in my new Evil Genie block chain, the currency units will be known as MonkeyPaws and it will enforce arbitrary poorly thought out utterances with inhuman consistency.
posted by idiopath at 11:10 AM on January 18, 2018 [7 favorites]
posted by idiopath at 11:10 AM on January 18, 2018 [7 favorites]
The only real world use for blockchain anyone has shown me was this one from Briana Wu, using it to anonymously verify election counting.
posted by Pirate-Bartender-Zombie-Monkey at 4:15 PM on January 18, 2018
posted by Pirate-Bartender-Zombie-Monkey at 4:15 PM on January 18, 2018
You don't need a blockchain for that, Pirate. A centralized database will work fine, and cryptographic private, verifiable voting schemes have been around since before bitcoin was released (see the bibliography in that link.)
posted by Coventry at 5:28 PM on January 18, 2018 [7 favorites]
posted by Coventry at 5:28 PM on January 18, 2018 [7 favorites]
Do you love me?
Will you love me forever?
Will you put it on the blockchain?
First blockchain marriage. (2014)
posted by Coventry at 5:29 PM on January 18, 2018 [1 favorite]
Will you love me forever?
Will you put it on the blockchain?
First blockchain marriage. (2014)
posted by Coventry at 5:29 PM on January 18, 2018 [1 favorite]
I think this article is pretty unimaginative about potential smart-contract arrangements. It is perfectly feasible for a smart contract to provide some party the option to take some action when certain conditions are met, without irretrievably mandating that action. Mutually agreed rollbacks can be built in in case some detail proves unworkable. And people are free to mix all of this with natural language agreements and social expectations if they wish.
posted by Coventry at 8:37 PM on January 18, 2018
posted by Coventry at 8:37 PM on January 18, 2018
I want "atomic" cross-chain trades to "work" and become popular, especially in conjunction with zero-knowledge schemes like ZCash.
Why? "Atomic" sounds impossible for blockchains, making it pure marketing. Instead, cross-chain trades will (a) create markets that cannot be frozen so crashes can obliterate everything overnight without any exchange to halt trading, and even better (b) enable profitable net-split, 51%, etc. attacks. Isolate your targets network before doing your trade so that they observe you paying them in X while they pay you in Y but then the X rolls back into your account and you push all your refunded X and the Y they paid you into shielded transactions. <popcorn>
posted by jeffburdges at 8:33 AM on January 19, 2018
Why? "Atomic" sounds impossible for blockchains, making it pure marketing. Instead, cross-chain trades will (a) create markets that cannot be frozen so crashes can obliterate everything overnight without any exchange to halt trading, and even better (b) enable profitable net-split, 51%, etc. attacks. Isolate your targets network before doing your trade so that they observe you paying them in X while they pay you in Y but then the X rolls back into your account and you push all your refunded X and the Y they paid you into shielded transactions. <popcorn>
posted by jeffburdges at 8:33 AM on January 19, 2018
There's an amazing overlap between smart-contract enthusiasts and men who think their reasoning from first principles outweighs the actual experience of a girl who's merely worked on billion-dollar contract litigations...
praemunire
It's really not any better as a male attorney either. Discussing smart contracts with crypto enthusiasts is a pointless, frustrating experience because they know so little about how contracts work or how they're used but they're so sure they've figured it all out. It's almost as frustrating as discussing IP law with tech people in general. Engineer's Disease is a terrible thing.
posted by Sangermaine at 8:44 AM on January 19, 2018 [2 favorites]
praemunire
It's really not any better as a male attorney either. Discussing smart contracts with crypto enthusiasts is a pointless, frustrating experience because they know so little about how contracts work or how they're used but they're so sure they've figured it all out. It's almost as frustrating as discussing IP law with tech people in general. Engineer's Disease is a terrible thing.
posted by Sangermaine at 8:44 AM on January 19, 2018 [2 favorites]
Witness the silly Cryptocurrency nerds, flatly denying the need for human agency in real-world smart-contract arrangements.
posted by Coventry at 10:22 PM on January 19, 2018
posted by Coventry at 10:22 PM on January 19, 2018
Witness the silly Cryptocurrency nerds, flatly denying the need for human agency in real-world smart-contract arrangements.
I work in an industry - computer-generated film and television production - which does nothing but create and deliver digital goods, which your link suggests is the one place where smart contracts should work flawlessly. However, based on my experience, I think that the usefulness of smart contracts would only apply to already finished, already packaged digital goods. While digital goods are being produced - and I know that this is the case for custom software development, too - there's a lot of back-and-forth about what, exactly, the final product will be and when it will be delivered. The contract was signed at the start, but the detailed meaning of the contract keeps evolving during each round of reviews and revisions. I don't see how any automated agent could determine whether the goods were delivered as per the contract.
posted by clawsoon at 5:10 AM on January 20, 2018 [3 favorites]
I work in an industry - computer-generated film and television production - which does nothing but create and deliver digital goods, which your link suggests is the one place where smart contracts should work flawlessly. However, based on my experience, I think that the usefulness of smart contracts would only apply to already finished, already packaged digital goods. While digital goods are being produced - and I know that this is the case for custom software development, too - there's a lot of back-and-forth about what, exactly, the final product will be and when it will be delivered. The contract was signed at the start, but the detailed meaning of the contract keeps evolving during each round of reviews and revisions. I don't see how any automated agent could determine whether the goods were delivered as per the contract.
posted by clawsoon at 5:10 AM on January 20, 2018 [3 favorites]
I think by "digital assets" they mean things like cryptocurrencies. It's going to be a while before automation of any kind, cryptocurrency or otherwise, can replace the judgement and creativity needed for the work you're doing.
posted by Coventry at 12:19 PM on January 20, 2018
posted by Coventry at 12:19 PM on January 20, 2018
Does that mean that the one thing that smart contracts will definitely be good for is using cryptocurrencies to buy other cryptocurrencies? :-)
posted by clawsoon at 1:18 PM on January 20, 2018
posted by clawsoon at 1:18 PM on January 20, 2018
It means they have potential for automating simple financial arrangements without needing to bring the law into it.
posted by Coventry at 1:50 PM on January 20, 2018
posted by Coventry at 1:50 PM on January 20, 2018
Also, they can automate the simple parts and, leave humans in the loop where necessary. As I said, it's quite possible to add recission on mutual agreement (all parties send a signed message to the contract), or provide some party with an option for some action when certain conditions are met (e.g., they send a signed message to the contract to collect a staked penalty fee.)
posted by Coventry at 1:55 PM on January 20, 2018
posted by Coventry at 1:55 PM on January 20, 2018
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** [I'm sure someone could come up with a version that works for situations like legal prostitution, or something, but that's a rather narrow edge-case and also somewhat not the point. Alternately, you could do like Ben Shapiro and be an apologist for marital rape by claiming that marriage constitutes a full consent contract, but it's solidly advisable to not be like Ben Shapiro.]
posted by mystyk at 4:18 AM on January 18, 2018 [4 favorites]