7 ms·

I always say "the moment you need to verify that a human did something outside the system, your blockchain is broken."

by joshwa 8y ago

dnautics 8y ago
That is great.
osrec 8y ago
I extend it further: the moment you need to verify that something happened outside the system, your blockchain is broken.
- dnautics 8y ago
  There are ideas around trusted oracles and consensus recommendation ratings for oracles that aren't terrible and may work (no comment on scalability, of course).
  - therein 8y ago
    I cannot trust a system that trusts an oracle.
    - hndamien 8y ago
      What if it is a trustless Oracle? Augur kind of tries to be this, and appears to do well within a limited scope.
      - davidgerard 8y ago
        Very limited, i.e. they're down to a few tens of people bothering to vote daily.
        hndamien 8y ago
        The amount of people “voting” seems to be less important than the amount at stake, as if it was a large stake proved incorrectly somebody may come in and fix that. $1.2m trades in 1 market with $800k open interest isn’t that bad.
  - qyv 8y ago
    Trusted is the opposite of trustless.
    - dnautics 8y ago
      The point is that in a trustless system trust can be earned by reputation, which is distributable and relatively trustless. Sure, you are taking the risk that you'll get screwed, but that risk factor should be calculable.
  - tim333 8y ago
    It's worked so far for the Dai, a USD tethered stablecoin based on Ethereum. Smart contracts buy or sell Dai against ETH to keep the price around US$1, the oracles feed in the USD/ETH rate from various exchanges. No actual USD are bought or sold by the Dai contracts. https://coinmarketcap.com/currencies/dai/ https://coinmarketcap.com/currencies/dai/
mathnmusic 8y ago
This is not necessarily true. You can create a marketplace for facts (eg: oracles or prediction markets) and therefore create incentives for bystanders to bring facts to blockchain. Sure, it doesn't have 100% guarantees, but it might improve on the current scenario in certain cases.
- thisisit 8y ago
  That is assuming everyone is moved by money and everything works in perfectly rational way. The problem is - humans are irrational.
  - pas 8y ago
    No, that's a very bad model. Humans have a hidden utility function and they maximize that. (See also bounded rationality, weak revealed preference axiom for market modeling.)
- davidgerard 8y ago
  Your claim is remarkably hypothetical and lacking in details. That said, even then - when would it be cheaper just to bribe the voters?
  - pas 8y ago
    That's why people stake claims, and the more money they put up, the more they bet on what they claim, the more you can be sure that it's not just a troll, not a hoax, not someone trying to move the market, not someone bought and paid for (so not a Sybil attack).
    - theamk 8y ago
      But staking is naturally limited by the amount of money one has -- so it would be a great advantage for big corps with PR budgets and a disadvantage for individuals. Do we really want that? Hypothetical example: - The Citizen (on blockchain): EvilCorp is dumping toxic waste on my property! They are making millions of dollars from my ruin! I stake all of my available money -- $20,000 -- on this statement. - EvilCorp (on blockchain): No we are not. We stake 1% of our discretionary PR budget -- $200,000 -- on this statement. - PR firm (on blockchain): We stake $200,000 to support EvilCorp. They are our biggest customer, and we can handle the (unlikely) money loss if this means good relationship. - Other citizens of the town: yeah, that sludge looks really nasty.. but EvilCorp has a ton of money. That guy has almost nothing, I do not think he is going to win. If we support him, we will likely lose our stake. So it makes financial sense to side with EvilCorp. - Blockchain decides EvilCorp is correct. The Citizen now has backyard full of toxic sludge and broke. - EvilCorp and PR firm both get even more money.
Groxx 8y ago
if you need accurate verification, or it boils down to a single person, agreed. (though that's not often possible, e.g. bribery) if you need to know the final consensus (or lack thereof) about that verification, regardless of how consensus is determined, it's not a deal-breaker. multi-party signatures, basically, which is what ethereum is designed to do. (for context tho: broadly I agree, blockchains make zero sense in very nearly all potential scenarios)

I always say "the moment you need to verify that a human did something outside the system, your blockchain is broken."

by joshwa 8y ago

I always say "the moment you need to verify that a human did something outside the system, your blockchain is broken."

dnautics 8y ago

That is great.

osrec 8y ago

I extend it further: the moment you need to verify that something happened outside the system, your blockchain is broken.

dnautics 8y ago
There are ideas around trusted oracles and consensus recommendation ratings for oracles that aren't terrible and may work (no comment on scalability, of course).
- therein 8y ago
  I cannot trust a system that trusts an oracle.
  - hndamien 8y ago
    What if it is a trustless Oracle? Augur kind of tries to be this, and appears to do well within a limited scope.
    - davidgerard 8y ago
      Very limited, i.e. they're down to a few tens of people bothering to vote daily.
      - hndamien 8y ago
        The amount of people “voting” seems to be less important than the amount at stake, as if it was a large stake proved incorrectly somebody may come in and fix that. $1.2m trades in 1 market with $800k open interest isn’t that bad.
- qyv 8y ago
  Trusted is the opposite of trustless.
  - dnautics 8y ago
    The point is that in a trustless system trust can be earned by reputation, which is distributable and relatively trustless. Sure, you are taking the risk that you'll get screwed, but that risk factor should be calculable.
- tim333 8y ago
  It's worked so far for the Dai, a USD tethered stablecoin based on Ethereum. Smart contracts buy or sell Dai against ETH to keep the price around US$1, the oracles feed in the USD/ETH rate from various exchanges. No actual USD are bought or sold by the Dai contracts. https://coinmarketcap.com/currencies/dai/ https://coinmarketcap.com/currencies/dai/

mathnmusic 8y ago

This is not necessarily true. You can create a marketplace for facts (eg: oracles or prediction markets) and therefore create incentives for bystanders to bring facts to blockchain. Sure, it doesn't have 100% guarantees, but it might improve on the current scenario in certain cases.

thisisit 8y ago
That is assuming everyone is moved by money and everything works in perfectly rational way. The problem is - humans are irrational.
- pas 8y ago
  No, that's a very bad model. Humans have a hidden utility function and they maximize that. (See also bounded rationality, weak revealed preference axiom for market modeling.)
davidgerard 8y ago
Your claim is remarkably hypothetical and lacking in details. That said, even then - when would it be cheaper just to bribe the voters?
- pas 8y ago
  That's why people stake claims, and the more money they put up, the more they bet on what they claim, the more you can be sure that it's not just a troll, not a hoax, not someone trying to move the market, not someone bought and paid for (so not a Sybil attack).
  - theamk 8y ago
    But staking is naturally limited by the amount of money one has -- so it would be a great advantage for big corps with PR budgets and a disadvantage for individuals. Do we really want that? Hypothetical example: - The Citizen (on blockchain): EvilCorp is dumping toxic waste on my property! They are making millions of dollars from my ruin! I stake all of my available money -- $20,000 -- on this statement. - EvilCorp (on blockchain): No we are not. We stake 1% of our discretionary PR budget -- $200,000 -- on this statement. - PR firm (on blockchain): We stake $200,000 to support EvilCorp. They are our biggest customer, and we can handle the (unlikely) money loss if this means good relationship. - Other citizens of the town: yeah, that sludge looks really nasty.. but EvilCorp has a ton of money. That guy has almost nothing, I do not think he is going to win. If we support him, we will likely lose our stake. So it makes financial sense to side with EvilCorp. - Blockchain decides EvilCorp is correct. The Citizen now has backyard full of toxic sludge and broke. - EvilCorp and PR firm both get even more money.

Groxx 8y ago

if you need accurate verification, or it boils down to a single person, agreed. (though that's not often possible, e.g. bribery) if you need to know the final consensus (or lack thereof) about that verification, regardless of how consensus is determined, it's not a deal-breaker. multi-party signatures, basically, which is what ethereum is designed to do. (for context tho: broadly I agree, blockchains make zero sense in very nearly all potential scenarios)