17 ms·

> For example, you can have a perfectly legal contract, but the other party is in a corrupt foreign jurisdiction that would never find in your favor in the even

> For example, you can have a perfectly legal contract, but the other party is in a corrupt foreign jurisdiction that would never find in your favor in the event of a breach. Then you can't contract with them because they have no incentive not to breach, without an alternative method of ensuring compliance that doesn't rely on their corrupt government. can you give a concrete example? this requires a smart contract does it not? what is an example contract (specifically) where this is useful?

techslave 8y ago
oh. and how is it better than using an escrow service?
AnthonyMouse 8y ago
> can you give a concrete example? this requires a smart contract does it not? what is an example contract (specifically) where this is useful? Suppose you make a loan to someone in an untrustworthy jurisdiction. The contract says you provide X amount in Bitcoin today and get paid back with interest in five years. The borrower is a real estate developer who has a separate contract with a local buyer to purchase the property in five years, so they can use the smart contract for the real estate purchase to commit the portion of the purchase price to you equal to the loan principal plus interest. If the borrower breaches by not building the property then you still get paid and the dispute is between the developer and the buyer over the separate contract, but they're both local which means the local courts would be fair to them (and if they're not it's still not your problem). Using an escrow service doesn't work because the chronology of the loan requires you to release the money to them to build the property five years before they receive the money to pay you back with.
- nradov 8y ago
  That's not how real estate development actually works in most of the world. Buyers almost never commit any cash 5 years in advance of property completion. If you want to convince anyone you're going to need a more realistic example.

techslave 8y ago

oh. and how is it better than using an escrow service?

AnthonyMouse 8y ago

> can you give a concrete example? this requires a smart contract does it not? what is an example contract (specifically) where this is useful? Suppose you make a loan to someone in an untrustworthy jurisdiction. The contract says you provide X amount in Bitcoin today and get paid back with interest in five years. The borrower is a real estate developer who has a separate contract with a local buyer to purchase the property in five years, so they can use the smart contract for the real estate purchase to commit the portion of the purchase price to you equal to the loan principal plus interest. If the borrower breaches by not building the property then you still get paid and the dispute is between the developer and the buyer over the separate contract, but they're both local which means the local courts would be fair to them (and if they're not it's still not your problem). Using an escrow service doesn't work because the chronology of the loan requires you to release the money to them to build the property five years before they receive the money to pay you back with.

nradov 8y ago
That's not how real estate development actually works in most of the world. Buyers almost never commit any cash 5 years in advance of property completion. If you want to convince anyone you're going to need a more realistic example.