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To summarize what oracles appear to do, they capitalize on information served via https and the verified status of the certificates used by sites, to have an in

by sriku 9y ago

To summarize what oracles appear to do, they capitalize on information served via https and the verified status of the certificates used by sites, to have an independent party (the "notary") declare that the information was indeed produced by the party. So the signed statement is of the form - Entity E verified by certificate C said statement S on date D You can also get, for example, the TLSNotary [1] to sign a secure page's contents for you without sending over the contents to the service. To me, this seems to form enough of a trust network to enable injecting external world data into blockchains, with certificate authorities as the linchpins. Appreciate if any security folks here can take this apart and explain/validate/trash in detail. [1] https://tlsnotary.org/pagesigner.html https://tlsnotary.org/pagesigner.html

mannykannot 9y ago
I have not figured out how this would solve the problem of on-blockchain debt: "If the funds used for coupon payments are controlled by the bond's smart contract, then those payments can indeed be guaranteed. But this also means those funds cannot be used by the bond issuer for anything else. And if those funds aren’t under the control of the smart contract, then there is no way in which payment can be guaranteed. In other words, a smart bond is either pointless for the issuer, or pointless for the investor."
- runeks 9y ago
  > I have not figured out how this would solve the problem of on-blockchain debt There really is no problem, unless you have unrealistic expectations as to what a blockchain can do. There’s essentially no difference between lending a company money, with which it purchases machinery, and lending this machinery directly to the company. Believing a blockchain can ensure that when I lend you my car (a form of machinery) I will get it back without a scratch, is simply unreasonable.
  - mannykannot 9y ago
    I don't know if you have a valid argument in general, but your specific example seems to be a bit off the mark. If I buy a conventional bond issued by a company and hold it until term, and the company does not default, I am owed coupon payments and a return of the principal. I am taking interest-rate, inflation and default risks, but not depreciation. I expect an on-blockchain contract would have to allow for default (which I suppose it could, given a way to signal external events.) Currently, of course, this is handled through negotiation, arbitration, or ultimately the bankruptcy courts. It would certainly seem unrealistic to expect that to be replaced by smart contracts anytime soon.
    - runeks 9y ago
      You’re right. Only if we ignore depreciation of capital goods are the two examples equivalent. But I was trying to convey the fact that money is just a replacement for physical goods, such that if the lender doesn’t purchase something with the lent funds, the loan would be meaningless. And as soon as the lender spends the lent funds, there’s a risk that it won’t be able to recover this cost. In other words, riskless credit makes no sense, since the presence of risk is why there’s a potential return for the lender in the first place.
  - deleted 9y ago
    [deleted]

by sriku 9y ago

mannykannot 9y ago

I have not figured out how this would solve the problem of on-blockchain debt: "If the funds used for coupon payments are controlled by the bond's smart contract, then those payments can indeed be guaranteed. But this also means those funds cannot be used by the bond issuer for anything else. And if those funds aren’t under the control of the smart contract, then there is no way in which payment can be guaranteed. In other words, a smart bond is either pointless for the issuer, or pointless for the investor."

runeks 9y ago
> I have not figured out how this would solve the problem of on-blockchain debt There really is no problem, unless you have unrealistic expectations as to what a blockchain can do. There’s essentially no difference between lending a company money, with which it purchases machinery, and lending this machinery directly to the company. Believing a blockchain can ensure that when I lend you my car (a form of machinery) I will get it back without a scratch, is simply unreasonable.
- mannykannot 9y ago
  I don't know if you have a valid argument in general, but your specific example seems to be a bit off the mark. If I buy a conventional bond issued by a company and hold it until term, and the company does not default, I am owed coupon payments and a return of the principal. I am taking interest-rate, inflation and default risks, but not depreciation. I expect an on-blockchain contract would have to allow for default (which I suppose it could, given a way to signal external events.) Currently, of course, this is handled through negotiation, arbitration, or ultimately the bankruptcy courts. It would certainly seem unrealistic to expect that to be replaced by smart contracts anytime soon.
  - runeks 9y ago
    You’re right. Only if we ignore depreciation of capital goods are the two examples equivalent. But I was trying to convey the fact that money is just a replacement for physical goods, such that if the lender doesn’t purchase something with the lent funds, the loan would be meaningless. And as soon as the lender spends the lent funds, there’s a risk that it won’t be able to recover this cost. In other words, riskless credit makes no sense, since the presence of risk is why there’s a potential return for the lender in the first place.
- deleted 9y ago
  [deleted]