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This smart contract has no way of knowing if/what the damages are, whether the rent was paid in cash, or whether a million other legal issues are happening. Fo

by smt88 6y ago

This smart contract has no way of knowing if/what the damages are, whether the rent was paid in cash, or whether a million other legal issues are happening. For example, in most places, tenants may stop paying rent if their heat breaks in the winter and the landlord won't fix it promptly. The central authority will always be human courts. Smart contracts can't observe or record anything except crypto, which makes them useless in 99% of contractual disputes.

WnZ39p0Dgydaz1 6y ago
Yes, you will always need humans to make human judgements but they don't need to be part of a court or central authority. With reputation and consensus incentive systems in place, these judgements can be made by trusted 3rd parties and feed back into the smart contract without the need for a single central authority. The point isn't to get rid of humans or trusted 3rd parties. It's to get reduce the reliance on a single centralized entity that may be corrupt, inefficient, or malicious.
- smt88 6y ago
  > It's to get reduce the reliance on a single centralized entity that may be corrupt, inefficient, or malicious. This makes sense only in places with very corrupt legal systems. But if the legal system is corrupt in favor of one side (let's assume it's the landlord), why would the landlord mutually agree to arbitration? Please provide a very specific example of something that happens now that a smart contract would fix. I can't think of anything.
  - kodah 6y ago
    > Please provide a very specific example of something that happens now that a smart contract would fix. I can't think of anything. They already did, asking again isn't going to get you the answer you want. You described the renting market as having a high threshold for bias in order to be ineffective. I don't really think this is true, it's quite difficult in most states to go to court to seek damages for rental property. Even the eviction process is not straight forward and requires the participation of both a court and a marshal to serve notice. What smart contracts replace is a lot of the court mechanisms that are low hanging fruit. It takes some stress off of the system, but certainly not all, and that seems like it could be "good enough".
    - smt88 6y ago
      > They already did, asking again isn't going to get you the answer you want. The person I was responding to gave only generalities. > What smart contracts replace is a lot of the court mechanisms that are low hanging fruit. What court mechanisms? Let me give you a specific example. I'm a landlord with a rental contract. In my state (as in many states), there are hundreds of statutes dictating the boundaries of this contract. There are also thousands of cases in common law that influence what I can and can't contract. For example, my tenant cannot contract away certain rights, even if they sign a legal document saying that they did it. Scenario A: I use a smart contract stipulating that if there are damages, I can hold the security deposit. Scenario B: I have a paper contract stipulating the same (although in many states there are statutes that say this, so the contract is just repeating existing law). Now let's say I find "damage" and the renter disputes it. How has the smart contract helped me? What difference did it make? In many situations, the smart contract enforcing itself without 100% understanding of the physical world or existing law would violate the law. So that's how specific I'm asking you (or anyone) to be: give me a specific scenario where the smart contract enforces something in a reliable, efficient way that is significantly better/safer for either party.
      - kodah 6y ago
        > So that's how specific I'm asking you (or anyone) to be: give me a specific scenario where the smart contract enforces something in a reliable, efficient way that is significantly better/safer for either party. And I'll doubt you'll get that specific of answers because those implementations are fairly new. You'll likely see proof of concepts developed to streamline or back up existing processes first, the underlying technology adjusted to fit the usecases, rinse, and repeat. All that to say, it's not going to holistically solve every problem for you up front, as the commenter pointed out. What I can see is that it streamlines some of the mediation and court intervention processes. What our notable gains from that would be remain to be seen, but for my parents who are landlords that have had to evict tenants it could mean that simple cases don't require a court. Maybe they get some review by someone who would best be described as an auditor or mediator to check the outcome.
mindcandy 6y ago
Smart contracts are not going to instantly replace government with a techno-libertarian utopia. They are going to make government, lawyer and bank services a lot less necessary. And, they are going to provide a lot of alternative services to people without access to effective government/financial services. Smart contracts can’t observe anything but time, crypto and signaling from users/automated services. For disputes you need an independent third party to cast a deciding vote. A government judge is common option. But, you and I can agree to grant that vote to a non-government agent instead. Legal rental contracts are non-trivial. A rental smart contract would similarly require more rules than we care to spell out here. But, “If the tenant and the notary both vote that there is bullshittery going on with the property, rent is suspended.” sounds like a reasonable thing to include.
- smt88 6y ago
  > They are going to make government, lawyer and bank services a lot less necessary. All the benefits of smart contracts are available with regular old software. Why hasn't software destroyed these services already? > “If the tenant and the notary both vote that there is bullshittery going on with the property, rent is suspended.” sounds like a reasonable thing to include. Why do you need a smart contract for this? The tenant can do this right now without any software help or public ledger.
- leereeves 6y ago
  > “If the tenant and the notary both vote that there is bullshittery going on with the property, rent is suspended.” First, I think the word you're looking for is arbitrator. Notaries don't resolve disputes. Second, you've simply replaced a judge with a "notary", and left many questions unanswered. Who is this trusted 3rd party? How are they accountable? Can you appeal their judgements? Do they have an ongoing business relationship with one of the parties? And so on. I suspect that by the time you've answered all those questions, and dealt with all the issues that arise that require human judgement, you'll have reinvented government. Or worse, digitized mandatory arbitration.
- jonhendry18 6y ago
  "They are going to make government, lawyer and bank services a lot less necessary." Except when a third party finds bugs in the smart contract code and diverts the rent payments to themselves.

by smt88 6y ago

WnZ39p0Dgydaz1 6y ago

Yes, you will always need humans to make human judgements but they don't need to be part of a court or central authority. With reputation and consensus incentive systems in place, these judgements can be made by trusted 3rd parties and feed back into the smart contract without the need for a single central authority. The point isn't to get rid of humans or trusted 3rd parties. It's to get reduce the reliance on a single centralized entity that may be corrupt, inefficient, or malicious.

smt88 6y ago
> It's to get reduce the reliance on a single centralized entity that may be corrupt, inefficient, or malicious. This makes sense only in places with very corrupt legal systems. But if the legal system is corrupt in favor of one side (let's assume it's the landlord), why would the landlord mutually agree to arbitration? Please provide a very specific example of something that happens now that a smart contract would fix. I can't think of anything.
- kodah 6y ago
  > Please provide a very specific example of something that happens now that a smart contract would fix. I can't think of anything. They already did, asking again isn't going to get you the answer you want. You described the renting market as having a high threshold for bias in order to be ineffective. I don't really think this is true, it's quite difficult in most states to go to court to seek damages for rental property. Even the eviction process is not straight forward and requires the participation of both a court and a marshal to serve notice. What smart contracts replace is a lot of the court mechanisms that are low hanging fruit. It takes some stress off of the system, but certainly not all, and that seems like it could be "good enough".
  - smt88 6y ago
    > They already did, asking again isn't going to get you the answer you want. The person I was responding to gave only generalities. > What smart contracts replace is a lot of the court mechanisms that are low hanging fruit. What court mechanisms? Let me give you a specific example. I'm a landlord with a rental contract. In my state (as in many states), there are hundreds of statutes dictating the boundaries of this contract. There are also thousands of cases in common law that influence what I can and can't contract. For example, my tenant cannot contract away certain rights, even if they sign a legal document saying that they did it. Scenario A: I use a smart contract stipulating that if there are damages, I can hold the security deposit. Scenario B: I have a paper contract stipulating the same (although in many states there are statutes that say this, so the contract is just repeating existing law). Now let's say I find "damage" and the renter disputes it. How has the smart contract helped me? What difference did it make? In many situations, the smart contract enforcing itself without 100% understanding of the physical world or existing law would violate the law. So that's how specific I'm asking you (or anyone) to be: give me a specific scenario where the smart contract enforces something in a reliable, efficient way that is significantly better/safer for either party.
    - kodah 6y ago
      > So that's how specific I'm asking you (or anyone) to be: give me a specific scenario where the smart contract enforces something in a reliable, efficient way that is significantly better/safer for either party. And I'll doubt you'll get that specific of answers because those implementations are fairly new. You'll likely see proof of concepts developed to streamline or back up existing processes first, the underlying technology adjusted to fit the usecases, rinse, and repeat. All that to say, it's not going to holistically solve every problem for you up front, as the commenter pointed out. What I can see is that it streamlines some of the mediation and court intervention processes. What our notable gains from that would be remain to be seen, but for my parents who are landlords that have had to evict tenants it could mean that simple cases don't require a court. Maybe they get some review by someone who would best be described as an auditor or mediator to check the outcome.

mindcandy 6y ago

Smart contracts are not going to instantly replace government with a techno-libertarian utopia. They are going to make government, lawyer and bank services a lot less necessary. And, they are going to provide a lot of alternative services to people without access to effective government/financial services. Smart contracts can’t observe anything but time, crypto and signaling from users/automated services. For disputes you need an independent third party to cast a deciding vote. A government judge is common option. But, you and I can agree to grant that vote to a non-government agent instead. Legal rental contracts are non-trivial. A rental smart contract would similarly require more rules than we care to spell out here. But, “If the tenant and the notary both vote that there is bullshittery going on with the property, rent is suspended.” sounds like a reasonable thing to include.

smt88 6y ago
> They are going to make government, lawyer and bank services a lot less necessary. All the benefits of smart contracts are available with regular old software. Why hasn't software destroyed these services already? > “If the tenant and the notary both vote that there is bullshittery going on with the property, rent is suspended.” sounds like a reasonable thing to include. Why do you need a smart contract for this? The tenant can do this right now without any software help or public ledger.
leereeves 6y ago
> “If the tenant and the notary both vote that there is bullshittery going on with the property, rent is suspended.” First, I think the word you're looking for is arbitrator. Notaries don't resolve disputes. Second, you've simply replaced a judge with a "notary", and left many questions unanswered. Who is this trusted 3rd party? How are they accountable? Can you appeal their judgements? Do they have an ongoing business relationship with one of the parties? And so on. I suspect that by the time you've answered all those questions, and dealt with all the issues that arise that require human judgement, you'll have reinvented government. Or worse, digitized mandatory arbitration.
jonhendry18 6y ago
"They are going to make government, lawyer and bank services a lot less necessary." Except when a third party finds bugs in the smart contract code and diverts the rent payments to themselves.