5 ms·

Sure, but if you both sign a legal contract to obey the outcome of the smart contract then no one owes anything, because the smart contract says that the $200M

Sure, but if you both sign a legal contract to obey the outcome of the smart contract then no one owes anything, because the smart contract says that the $200M is gone. Obviously this doesn't allow you get around laws such as warranties but I don't see why it can't be used if everyone agrees to it.

ceejayoz 5y ago
In some cases, perhaps, but not all. Fraud, for example, isn't legal even if you have a cleverly crafted contract that uses wording tricks to technically be true. I would expect a court to take a dim view of a smart contract that has an obfuscated, non-obvious mechanism for someone to siphon off all the money in an undisclosed fashion. "Code is law", but so's "you can't defraud people".
- SiliconAlley 5y ago
  Where’s the part where anybody defrauded anybody? This was clearly incompetence that benefited nobody (certainly the developers would rather not have TITAN implode and all of this USDC locked in a contract...). Embarrassing yes. Fraud? Pretty clearly no
  - ceejayoz 5y ago
    It's an example of a scenario where you can't sign certain rights away. Not specific to TITAN.
  - lupire 5y ago
    How can it be "locked"? Can't they deploy a protocol update to the members of the compute pool?
    - acjohnson55 5y ago
      Depends on how you write the contract. If you make a smart contract unilaterally updatable, then it's no longer decentralized and trustless, because people with admin rights can plunder it, or can be extorted, or compelled by authorities to turn over the capital.
nradov 5y ago
That's not how US civil courts work. If a contract is flawed then a judgment can be rendered based on intent, equity, and other factors. There are centuries of common law precedent for this. The existence of blockchains and "smart" contracts changes nothing.
shkkmo 5y ago
> Sure, but if you both sign a legal contract to obey the outcome of the smart contract then no one owes anything, You are begging the question by presupposing that for every smart contract there could be a possible legal contract that can bind the people who sign it to the results of the smart contract. If a smart contract is illegal, then any written contract that binds people to the results of that contract would be similarly illegal.
- jcrawfordor 5y ago
  Contracts can be unenforceable for reasons that might not be obvious to people who don't do contract law, as well. For example, the concept of consideration is not especially obvious, that contracts are often not enforceable if both parties do not receive consideration, which leads to things like peppercorn payments. I know about that as a layman but a contract attorney would know of many more non-obvious things that must be checked out to avoid having problems actually enforcing the contract. It seems like it would be very, very easy to produce a smart contract which a court would later determine was not enforceable in the first place, and perhaps order reversal of payments or other things. For one, as a general concept the parties to the contract need to actually understand the terms and courts will somewhat regularly throw a contract out if they think there were implications that were not apparent to one of the parties. Smart contracts seem like absolute minefields for this kind of problem.
  - shkkmo 5y ago
    Yeah, consulting a lawyer before drawing up an important contract is usually a very good idea for precisely these reasons. You can probably make small adjustments to a boilerplate without doing so, but that always adds atleast a little risk.
- crooked-v 5y ago
  A very obvious example: in most jurisdictions, a contract signed by a minor can be rendered null and void by that minor (or their legal guardian) at any time.
only_as_i_fall 5y ago
A valid contract requires a meeting of minds such that inserting something designed to trick the other party inside a contract is pretty much always invalid. If you sign a contract to abide by a smart contract that was designed in bad faith or misrepresented I fail to see how that's any different. Even valid contracts are bound by the law. E.G. you can't sell yourself into slavery. Similarly, a smart contract can be a tool to execute the terms of a legal contract, but if it behaves in a way that would be illegal under a traditional contract I doubt any court in the US or Europe is going to recognize that as legal. I admit enforcement is another issue entirely though.
unyttigfjelltol 5y ago
... and a small band of programmers quietly sneak out of the room ... If your mechanic installs the tires in the passenger cabin, no one cares about the mechanics' lien. Depending on the judge they might not even care about the fine print on the back of the invoice, because installing tires in the passenger compartment is that dumb.

ceejayoz 5y ago

In some cases, perhaps, but not all. Fraud, for example, isn't legal even if you have a cleverly crafted contract that uses wording tricks to technically be true. I would expect a court to take a dim view of a smart contract that has an obfuscated, non-obvious mechanism for someone to siphon off all the money in an undisclosed fashion. "Code is law", but so's "you can't defraud people".

SiliconAlley 5y ago
Where’s the part where anybody defrauded anybody? This was clearly incompetence that benefited nobody (certainly the developers would rather not have TITAN implode and all of this USDC locked in a contract...). Embarrassing yes. Fraud? Pretty clearly no
- ceejayoz 5y ago
  It's an example of a scenario where you can't sign certain rights away. Not specific to TITAN.
- lupire 5y ago
  How can it be "locked"? Can't they deploy a protocol update to the members of the compute pool?
  - acjohnson55 5y ago
    Depends on how you write the contract. If you make a smart contract unilaterally updatable, then it's no longer decentralized and trustless, because people with admin rights can plunder it, or can be extorted, or compelled by authorities to turn over the capital.

nradov 5y ago

That's not how US civil courts work. If a contract is flawed then a judgment can be rendered based on intent, equity, and other factors. There are centuries of common law precedent for this. The existence of blockchains and "smart" contracts changes nothing.

shkkmo 5y ago

> Sure, but if you both sign a legal contract to obey the outcome of the smart contract then no one owes anything, You are begging the question by presupposing that for every smart contract there could be a possible legal contract that can bind the people who sign it to the results of the smart contract. If a smart contract is illegal, then any written contract that binds people to the results of that contract would be similarly illegal.

jcrawfordor 5y ago
Contracts can be unenforceable for reasons that might not be obvious to people who don't do contract law, as well. For example, the concept of consideration is not especially obvious, that contracts are often not enforceable if both parties do not receive consideration, which leads to things like peppercorn payments. I know about that as a layman but a contract attorney would know of many more non-obvious things that must be checked out to avoid having problems actually enforcing the contract. It seems like it would be very, very easy to produce a smart contract which a court would later determine was not enforceable in the first place, and perhaps order reversal of payments or other things. For one, as a general concept the parties to the contract need to actually understand the terms and courts will somewhat regularly throw a contract out if they think there were implications that were not apparent to one of the parties. Smart contracts seem like absolute minefields for this kind of problem.
- shkkmo 5y ago
  Yeah, consulting a lawyer before drawing up an important contract is usually a very good idea for precisely these reasons. You can probably make small adjustments to a boilerplate without doing so, but that always adds atleast a little risk.
crooked-v 5y ago
A very obvious example: in most jurisdictions, a contract signed by a minor can be rendered null and void by that minor (or their legal guardian) at any time.

only_as_i_fall 5y ago

A valid contract requires a meeting of minds such that inserting something designed to trick the other party inside a contract is pretty much always invalid. If you sign a contract to abide by a smart contract that was designed in bad faith or misrepresented I fail to see how that's any different. Even valid contracts are bound by the law. E.G. you can't sell yourself into slavery. Similarly, a smart contract can be a tool to execute the terms of a legal contract, but if it behaves in a way that would be illegal under a traditional contract I doubt any court in the US or Europe is going to recognize that as legal. I admit enforcement is another issue entirely though.

unyttigfjelltol 5y ago

... and a small band of programmers quietly sneak out of the room ... If your mechanic installs the tires in the passenger cabin, no one cares about the mechanics' lien. Depending on the judge they might not even care about the fine print on the back of the invoice, because installing tires in the passenger compartment is that dumb.