6 ms·

Plus there's the problem that smart contracts cannot be easily modified if they are found to be buggy and that one can always reverse engineer them, because the

Plus there's the problem that smart contracts cannot be easily modified if they are found to be buggy and that one can always reverse engineer them, because they're distributed to everyone. These two together have already caused lots of damage https://hackernoon.com/yes-this-kid-really-just-deleted-150-million-dollar-by-messing-around-with-ethereums-smart-2d6bb6750bb9 https://hackernoon.com/yes-this-kid-really-just-deleted-150-... and they make most real-world uses impossible. It is pretty much impossible to sell anything digital with smart contracts, because due to the source code being accessible to everyone you can always figure out the password, key, or secret URL to whatever is being sold. Without paying for it.

pfisch 7y ago
> It is pretty much impossible to sell anything digital with smart contracts, because due to the source code being accessible to everyone you can always figure out the password, key, or secret URL to whatever is being sold. Without paying for it. Pirating most software/movies/music is pretty easy, but people still sell it. I'm not sure this is as big a problem as you think it is.
magma17 7y ago
That's what oracles do.
- joosters 7y ago
  If you have to trust an oracle, you have essentially thrown away all of the plusses of decentralisation/trustlessness. At that point, the blockchain becomes pointless busywork, useful only for duping mug investors.
  - nootropicat 7y ago
    The impossibility of a full elimination of trust, for any particular problem, doesn't mean a partial reduction isn't valuable. If you disagree, would you be fine with changing the political and justice system of your country into a fully opaque black box? As in, you still can vote for the policies you want, but it's impossible to know how the government functions, what are the reasons for its decisions, or even who personally forms the government, to the point it could be run by aliens or an ai. Sometimes people are arrested for crimes, but it's impossible to know what's the evidence or even what the crime was, even after sentencing. If you don't consider this equivalent to the currently utilized system in your country, you have to agree that there's value in trust minimization.
    - monospaceisgood 7y ago
      Infiltrate a government or a justice system require a lot of time and resources. A blockchain? not so much You basically replace trust (with doubts) with faith.
    - SpicyLemonZest 7y ago
      I think we're detached from the original discussion. "That's what oracles do" was a response to the problem that "smart contracts cannot be easily modified if they are found to be buggy". Trust minimization is valuable, but a smart contract that allows an oracle to unilaterally override its terms doesn't minimize trust in any meaningful way.
  - dorgo 7y ago
    care to elaborate? Afaik, oracles are used to synchronize the blockchain to the real world and there are sophisticated mechanisms to keep them honest.
bouncycastle 7y ago
There hasn't been any high profile smart contract hacks for a while now. Early days are always fraught with disasters. The field is evolving with "best practices", formal verification and lessons learned from past mistakes, so you'll find that these days things are more stable. One example is MakerDAO which has around $300 million in value locked, and has been running without incident for a while now.
- joosters 7y ago
  I bet you that their smart contract, like most other significant ones, has been designed to be upgradable. That means the authors can modify the smart contract whenever they want, which means it implicitly has a centralised trust mechanism (I.e. you had better hope that the authors don’t go rogue and screw over the users) Central point of trust => blockchain part is now pointless, as ever.
  - deleted 7y ago
    [deleted]
  - mhluongo 7y ago
    Those upgrade mechanisms don't need to be centralized, and are sometimes vote-based. Unsure about the upgrade mech behind Maker though.
  - bouncycastle 7y ago
    Nope, Maker contracts are not upgradable. Although the main achilles heel with Maker is the governance and the oracle. The new version of maker has minimised the governance, and the new oracle design has better protection against an oracle attack. Ideally, you want as little governance as possible.
    - v64 7y ago
      > Nope, Maker contracts are not upgradable. This may have been true in the past, but not anymore. Here's [1] an example of a minor bug that was recently discovered in the MCD deployment and how they're going to patch it. The modules in the Maker system have variables that point to which smart contract to call to execute their actions, and the Maker governance is involved in changing these values. [1] https://forum.makerdao.com/t/proposal-upgrading-the-flopper/835 https://forum.makerdao.com/t/proposal-upgrading-the-flopper/...
alanfalcon 7y ago
The best smart contracts don't need to be reverse engineered, they've got shared, verified source code. The bugginess is a real problem as you've pointed out. The "impossible to sell anything" couldn't actually be farther than the truth from all my experience buying and selling NFTs. Over $150,000 USD worth of digital collectable game cards have been traded this week alone over at https://opensea.io/recent https://opensea.io/recent - everything is based on cryptographic signing and verified ownership on smart contracts, and it works great.
- simias 7y ago
  Digital assets are obviously the best possible use case for blockchains and smart contracts, but can it really work outside of that use case? And even for that use case is it really more convenient than centralized solutions? From what I can tell browsing through this website those digital "assets" seem to be yet another speculative outlet with some limited gamification on top. It's cool from a technical perspective but where do we go from there?
  - ErikAugust 7y ago
    You can make real games that leverage these type of assets. Plug: https://www.megacity.gg https://www.megacity.gg.
  - alanfalcon 7y ago
    We're going to get the Metaverse from there, eventually! And it will be glorious. A great definition of the Metaverse and what role blockchain may play in it: https://soundcloud.com/siggraph-spotlight/30-tim-sweeney-and-the-metaverse https://soundcloud.com/siggraph-spotlight/30-tim-sweeney-and... I can confirm that the blockchain is way more convenient than centralized solutions for buying and selling digital assets once you get over the initial friction (which is still way too much). The keys here are open standards, composability, and trustless atomic transactions. As a user, I basically look at ethereum as an in-game currency—and the game is the whole of the ethereum gaming space (still nascent, yes, and polluted by a great many scammy speculative shell games) rather than a single game. As for working outside of digital asset use cases, there are certainly a large number of people trying to get it to work though I agree the use case is much less clear cut. Without exactly agreeing with Vinay here, I at least appreciated the perspective he shared in detail on this episode of the NonFunGerbils podcast: https://nonfungerbils.com/podcast/3-vinay-gupta-indexing-the-physical-world https://nonfungerbils.com/podcast/3-vinay-gupta-indexing-the...

pfisch 7y ago

> It is pretty much impossible to sell anything digital with smart contracts, because due to the source code being accessible to everyone you can always figure out the password, key, or secret URL to whatever is being sold. Without paying for it. Pirating most software/movies/music is pretty easy, but people still sell it. I'm not sure this is as big a problem as you think it is.

magma17 7y ago

That's what oracles do.

joosters 7y ago
If you have to trust an oracle, you have essentially thrown away all of the plusses of decentralisation/trustlessness. At that point, the blockchain becomes pointless busywork, useful only for duping mug investors.
- nootropicat 7y ago
  The impossibility of a full elimination of trust, for any particular problem, doesn't mean a partial reduction isn't valuable. If you disagree, would you be fine with changing the political and justice system of your country into a fully opaque black box? As in, you still can vote for the policies you want, but it's impossible to know how the government functions, what are the reasons for its decisions, or even who personally forms the government, to the point it could be run by aliens or an ai. Sometimes people are arrested for crimes, but it's impossible to know what's the evidence or even what the crime was, even after sentencing. If you don't consider this equivalent to the currently utilized system in your country, you have to agree that there's value in trust minimization.
  - monospaceisgood 7y ago
    Infiltrate a government or a justice system require a lot of time and resources. A blockchain? not so much You basically replace trust (with doubts) with faith.
  - SpicyLemonZest 7y ago
    I think we're detached from the original discussion. "That's what oracles do" was a response to the problem that "smart contracts cannot be easily modified if they are found to be buggy". Trust minimization is valuable, but a smart contract that allows an oracle to unilaterally override its terms doesn't minimize trust in any meaningful way.
- dorgo 7y ago
  care to elaborate? Afaik, oracles are used to synchronize the blockchain to the real world and there are sophisticated mechanisms to keep them honest.

bouncycastle 7y ago

There hasn't been any high profile smart contract hacks for a while now. Early days are always fraught with disasters. The field is evolving with "best practices", formal verification and lessons learned from past mistakes, so you'll find that these days things are more stable. One example is MakerDAO which has around $300 million in value locked, and has been running without incident for a while now.

joosters 7y ago
I bet you that their smart contract, like most other significant ones, has been designed to be upgradable. That means the authors can modify the smart contract whenever they want, which means it implicitly has a centralised trust mechanism (I.e. you had better hope that the authors don’t go rogue and screw over the users) Central point of trust => blockchain part is now pointless, as ever.
- deleted 7y ago
  [deleted]
- mhluongo 7y ago
  Those upgrade mechanisms don't need to be centralized, and are sometimes vote-based. Unsure about the upgrade mech behind Maker though.
- bouncycastle 7y ago
  Nope, Maker contracts are not upgradable. Although the main achilles heel with Maker is the governance and the oracle. The new version of maker has minimised the governance, and the new oracle design has better protection against an oracle attack. Ideally, you want as little governance as possible.
  - v64 7y ago
    > Nope, Maker contracts are not upgradable. This may have been true in the past, but not anymore. Here's [1] an example of a minor bug that was recently discovered in the MCD deployment and how they're going to patch it. The modules in the Maker system have variables that point to which smart contract to call to execute their actions, and the Maker governance is involved in changing these values. [1] https://forum.makerdao.com/t/proposal-upgrading-the-flopper/835 https://forum.makerdao.com/t/proposal-upgrading-the-flopper/...

alanfalcon 7y ago

The best smart contracts don't need to be reverse engineered, they've got shared, verified source code. The bugginess is a real problem as you've pointed out. The "impossible to sell anything" couldn't actually be farther than the truth from all my experience buying and selling NFTs. Over $150,000 USD worth of digital collectable game cards have been traded this week alone over at https://opensea.io/recent https://opensea.io/recent - everything is based on cryptographic signing and verified ownership on smart contracts, and it works great.

simias 7y ago
Digital assets are obviously the best possible use case for blockchains and smart contracts, but can it really work outside of that use case? And even for that use case is it really more convenient than centralized solutions? From what I can tell browsing through this website those digital "assets" seem to be yet another speculative outlet with some limited gamification on top. It's cool from a technical perspective but where do we go from there?
- ErikAugust 7y ago
  You can make real games that leverage these type of assets. Plug: https://www.megacity.gg https://www.megacity.gg.
- alanfalcon 7y ago
  We're going to get the Metaverse from there, eventually! And it will be glorious. A great definition of the Metaverse and what role blockchain may play in it: https://soundcloud.com/siggraph-spotlight/30-tim-sweeney-and-the-metaverse https://soundcloud.com/siggraph-spotlight/30-tim-sweeney-and... I can confirm that the blockchain is way more convenient than centralized solutions for buying and selling digital assets once you get over the initial friction (which is still way too much). The keys here are open standards, composability, and trustless atomic transactions. As a user, I basically look at ethereum as an in-game currency—and the game is the whole of the ethereum gaming space (still nascent, yes, and polluted by a great many scammy speculative shell games) rather than a single game. As for working outside of digital asset use cases, there are certainly a large number of people trying to get it to work though I agree the use case is much less clear cut. Without exactly agreeing with Vinay here, I at least appreciated the perspective he shared in detail on this episode of the NonFunGerbils podcast: https://nonfungerbils.com/podcast/3-vinay-gupta-indexing-the-physical-world https://nonfungerbils.com/podcast/3-vinay-gupta-indexing-the...