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Isn't part of the point of owning cryptocurrency that you want less government involvement - including government-funded protection from crime - than you would

by geofft 6y ago

Isn't part of the point of owning cryptocurrency that you want less government involvement - including government-funded protection from crime - than you would with government-run currencies? Like, it's always pitched as a positive that a transaction is irrevocable. If I put some money in a smart contract, it behaves exactly as specified in the smart contract. If I decide to invest in some overly complicated ICO (for which I can fully read the programmatic contract before I invest), and I lose money, and then I say "I am a poor unsophisticated investor who was taken advantage of, I want my money back," doesn't that fundamentally imperil the value proposition of having a smart, programmatic contract? Now only most of the contract is on the blockchain and there's also some hidden caselaw - and "mostly deterministic" means nondeterministic. That is - shouldn't people who believe in cryptocurrency be saying this is fine and good and working as intended, and not a problem to "fix"?

pfraze 6y ago
The most interesting thing I’ve seen from smart contracts is using them to structure funds management for international FOSS projects without having to create a legal entity. That saves a ton of cost and legal overhead which is otherwise very tedious. That said, the interesting question this raises is, what happens when disagreements happen over those smart contracts? It seems like inevitably lawsuits and regulations will arrive, potentially removing the upside of using smart contracts. This leaves me asking a couple questions. One, is the culture around “no reversable transactions!” a kind of defense mechanism against introducing legal overhead which could harm the value prop of crypto. Two, should legal overhead arrive, could the smart contracts still provide some value compared to old solutions?
- CryptoPunk 6y ago
  >>could the smart contracts still provide some value compared to old solutions? Yes, because possession is 9/10ths of the law, and so a smart contract's automatic assignment of possession, according to its terms, will in most cases be legally decisive.
  - cormacrelf 6y ago
    No, the 9/10ths aphorism is not a real law. Possession doesn’t even really factor at all in contract or restitution law for fungible currency. Smart contracts are contracts, because you agree to their automatically enforced terms when you sign them. The “legal overhead” is when the terms as written don’t match what you actually agreed on, for example there was a mistake. The only reason you don’t currently believe there is legal overhead is that nobody has done anything interesting enough to want to litigate the rules that would pretty obviously apply. Maybe they have already!
    - CryptoPunk 6y ago
      Thanks for the explanation of the contract dispute resolution process. But I wasn't suggesting it's a real law. From Wikipedia: Although the principle is an oversimplification, it can be restated as: "In a property dispute (whether real or personal), in the absence of clear and compelling testimony or documentation to the contrary, the person in actual, custodial possession of the property is presumed to be the rightful owner. The rightful owner shall have their possession returned to them; if taken or used. The shirt or blouse you are currently wearing is presumed to be yours, unless someone can prove that it is not."[2] Beyond the presumption of being the rightful owner that stems from having possession, is the barrier to legal action that often prevents ligitation in the event of a contract dispute. In such cases, the party in possession will likely maintain it. These barriers could be multiplied in multi-jurisdictional cases involving pseudonymous parties, as is often the case with FOSS projects, and other internet community endeavors.
      - cormacrelf 6y ago
        Wikipedia is actually talking about real laws there. If I have a basketball, and you complain to the court you have a better proprietary right to the basketball than me and then I stole it, then they can order me to give it back (specifically, award a constructive trust over the ball in your favour, so if I sold the ball I have to give you the proceeds etc), but it’s hard to argue that without evidence of your own possession of the ball. Fortunately contracts cases literally all have that evidence, because being owed something under a contract IS a better right than possession, and lack of evidence of possession is never the problem. This is why it is silly to be talking about possession dominating these disputes — your point about multi-jurisdiction FOSS arrangements would be better if you identified conflict of laws and other jurisdictional issues as preventing people making claims at all. It is merely coincidental that the people who currently have it retain it, it is not an instance of the possession dominating phenomenon. Edit: to be clear, people don’t shy away from prosecuting a valid contract claim simply because the other party currently possesses the item in question. “The other party has my stuff” is on the contrary very motivating to a lot of potential litigants. It is not a “barrier”.

by geofft 6y ago

pfraze 6y ago

The most interesting thing I’ve seen from smart contracts is using them to structure funds management for international FOSS projects without having to create a legal entity. That saves a ton of cost and legal overhead which is otherwise very tedious. That said, the interesting question this raises is, what happens when disagreements happen over those smart contracts? It seems like inevitably lawsuits and regulations will arrive, potentially removing the upside of using smart contracts. This leaves me asking a couple questions. One, is the culture around “no reversable transactions!” a kind of defense mechanism against introducing legal overhead which could harm the value prop of crypto. Two, should legal overhead arrive, could the smart contracts still provide some value compared to old solutions?

CryptoPunk 6y ago
>>could the smart contracts still provide some value compared to old solutions? Yes, because possession is 9/10ths of the law, and so a smart contract's automatic assignment of possession, according to its terms, will in most cases be legally decisive.
- cormacrelf 6y ago
  No, the 9/10ths aphorism is not a real law. Possession doesn’t even really factor at all in contract or restitution law for fungible currency. Smart contracts are contracts, because you agree to their automatically enforced terms when you sign them. The “legal overhead” is when the terms as written don’t match what you actually agreed on, for example there was a mistake. The only reason you don’t currently believe there is legal overhead is that nobody has done anything interesting enough to want to litigate the rules that would pretty obviously apply. Maybe they have already!
  - CryptoPunk 6y ago
    Thanks for the explanation of the contract dispute resolution process. But I wasn't suggesting it's a real law. From Wikipedia: Although the principle is an oversimplification, it can be restated as: "In a property dispute (whether real or personal), in the absence of clear and compelling testimony or documentation to the contrary, the person in actual, custodial possession of the property is presumed to be the rightful owner. The rightful owner shall have their possession returned to them; if taken or used. The shirt or blouse you are currently wearing is presumed to be yours, unless someone can prove that it is not."[2] Beyond the presumption of being the rightful owner that stems from having possession, is the barrier to legal action that often prevents ligitation in the event of a contract dispute. In such cases, the party in possession will likely maintain it. These barriers could be multiplied in multi-jurisdictional cases involving pseudonymous parties, as is often the case with FOSS projects, and other internet community endeavors.
    - cormacrelf 6y ago
      Wikipedia is actually talking about real laws there. If I have a basketball, and you complain to the court you have a better proprietary right to the basketball than me and then I stole it, then they can order me to give it back (specifically, award a constructive trust over the ball in your favour, so if I sold the ball I have to give you the proceeds etc), but it’s hard to argue that without evidence of your own possession of the ball. Fortunately contracts cases literally all have that evidence, because being owed something under a contract IS a better right than possession, and lack of evidence of possession is never the problem. This is why it is silly to be talking about possession dominating these disputes — your point about multi-jurisdiction FOSS arrangements would be better if you identified conflict of laws and other jurisdictional issues as preventing people making claims at all. It is merely coincidental that the people who currently have it retain it, it is not an instance of the possession dominating phenomenon. Edit: to be clear, people don’t shy away from prosecuting a valid contract claim simply because the other party currently possesses the item in question. “The other party has my stuff” is on the contrary very motivating to a lot of potential litigants. It is not a “barrier”.