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> code as law is terrible idea I don't know exactly what you mean by 'code as law', and I'm sure there are extremists that think smart contracts make law obsol

> code as law is terrible idea I don't know exactly what you mean by 'code as law', and I'm sure there are extremists that think smart contracts make law obsolete, but they are just wrong. Fraud via smart contract is still fraud. Theft via smart contract is still theft. There's nothing about having automatic processing of transactions that means you get to just ignore the legal system in your country. And that's fine, proper and good. Automatic processing of complex transactions is phenomenally useful, even if it doesn't make legal systems obsolete. Simplest example - with smart contracts transacting assets where the canonical record of ownership is on the blockchain, you can have a smart contract act as escrow for you, making sure that the transaction happens atomically without having to pay someone to hold the assets for you and release them once they have both. It is a better, more efficient solution than any that the traditional financial system has been able to come up with. In fact, it is exactly linking the legal world and the blockchain world that means that you can apply some of the same benefits of immediacy and atomicity to more assets in the real world. All that is needed is for the legal system to recognise blockchains as the canonical record of ownership of real assets. The real world legal system makes blockchain technology more useful, not less.

myownpetard 5y ago
With smart contracts there is only the code. There is no external trusted documentation that says what the intention of the code is. If the contract allows for an action to occur, then that action is permissible. It's the old quote taken to an extreme, "The good news about computers is that they do what you tell them to do. The bad news is that they do what you tell them to do." If there is a 'bug' that allows anybody to empty a smart contract, well it turns out that you were just hosting a complex coding competition with a prize.
- kybernetikos 5y ago
  > There is no external trusted documentation that says what the intention of the code is. Working out what both parties intended a contract to mean and what it should mean, sometimes in contradiction of what it actually says is exactly what the legal system does. You can't evade the legal system by writing your contract in a different form. Weirdly I think this idea comes from thinking law is code when it isn't.
  - myownpetard 5y ago
    A judge is supposed to read the smart contract source code and determine the intent? The parties are frequently anonymous and have never interacted outside of the publication the smart contract to the blockchain and another party interacting with it. There is no basis for determining intent besides the code itself. Are you thinking that the contracts have analogs to legal contracts? Usually (exclusively?) they only mediate transactions and behavior that is contained within the blockchain itself. There isn't an exchanging of assets that exist externally to the blockchain like real estate. Although I think crypto fanatics think that the world will trend that way. Truly programmable money has never existed before. If more of our monetary infrastructure migrates to blockchains it will be interesting to see how current contract law adapts and is applied. If you want to argue with 'code is law' proponent, ask them how they feel about the DAO hack and ensuing hard fork of Ethereum. That was an interesting case where the ETH community as a whole decided that code was not in fact law.
    - dTal 5y ago
      >A judge is supposed to read the smart contract source code and determine the intent? If it's hard for a judge, it's presumably also hard for anyone using the smart contract. >There is no basis for determining intent besides the code itself. I'll bet you any frequently used contract has an associated website. Basically, conducting your business on a blockchain doesn't exempt you from the law. You - the squishy human at the end of the transaction - are not on the blockchain, and neither is the author of any smart contract you might use. As long as the law recognizes blockchain assets as valid consideration in contracts, contract law trumps blockchain law.
      - myownpetard 5y ago
        Does participation in a smart contract imply any kind of legal agreement? You're essentially interacting with an api/bot that's being hosted by whatever blockchain community at large. Anybody can publish anything, and any unrelated parties can interact with it. Here's a thought experiment for you. If I were to publish a public webpage where you entered a routing number into a textbox and money was immediately transferred from my account to the specified account for the purpose of sending money to a friend of mine, but somebody else found the website and entered their routing number and drained my account. Would I have legal recourse? This is essentially the Parity wallet exploit. The API was only slightly more complicated than the example above, initWallet(). It's an interesting paradigm shift. If contracts are automatically enforced, what features of the existing legal system are obsolete? If monetary/financial contracts are completely logically unambiguous in their execution and there is no need to appeal to a designated wielder of physical force to ensure their execution... I think that notion, which sounds unrealistic to me, is what appeals to lot of crypto absolutists. It fails in a lot of the ways that smart contracts currently struggle, how to computationally, and in an unbiased way, relate crypto to the world outside of the blockchain. A good example of this is oracles, which are so flimsy in so many situations. As you said we don't exist on the blockchain, the physical world doesn't exist on the blockchain, so how can we do away with our existing systems for mediating disputes, determining intent etc?
thfuran 5y ago
>All that is needed is for the legal system to recognise blockchains as the canonical record of ownership of real assets. Then theft via smart contract can't be theft because it acted on the canonical record of ownership. This also causes tons of other problems. What happens if someone loses access to their wallet? Now there's a house that simply can't ever be sold?
- kybernetikos 5y ago
  > There is no external trusted documentation that says what the intention of the code is. No, if someone fraudulently updated a canonical record of ownership, then the legal system can provide remedies. If it were me, I'd write the smart contract to enable corrections in case of a legal decision but that's at the choice of whomever sets up the smart contract that provides the canonical record of ownership. Same situation for if someone loses their keys. All these problems can be solved with appropriately written smart contacts.
  - NovemberWhiskey 5y ago
    OK, so ... which courts of which legal jurisdictions can correct which contracts? Are courts in Guinea-Bissau allowed to correct contracts between counterparties in the US?
    - kybernetikos 5y ago
      This stuff is all normal when you're dealing with international contracts - it's not like nobody thought of doing international deals before satoshi. Some of the answers do depend on the specifics of course. If the asset being traded is US real estate for example I would expect the smart contract to be set up so it requires a US court decision to correct the register.
      - NovemberWhiskey 5y ago
        My point is that there's an entire subbranch of the law, generally called private international law, that has been created to deal with conflict of laws and jurisdictional issues. You're implying that there are simple deterministic rules to determine those kinds of questions but in fact it's a meta-problem.
deleted 5y ago
[deleted]

myownpetard 5y ago

With smart contracts there is only the code. There is no external trusted documentation that says what the intention of the code is. If the contract allows for an action to occur, then that action is permissible. It's the old quote taken to an extreme, "The good news about computers is that they do what you tell them to do. The bad news is that they do what you tell them to do." If there is a 'bug' that allows anybody to empty a smart contract, well it turns out that you were just hosting a complex coding competition with a prize.

kybernetikos 5y ago
> There is no external trusted documentation that says what the intention of the code is. Working out what both parties intended a contract to mean and what it should mean, sometimes in contradiction of what it actually says is exactly what the legal system does. You can't evade the legal system by writing your contract in a different form. Weirdly I think this idea comes from thinking law is code when it isn't.
- myownpetard 5y ago
  A judge is supposed to read the smart contract source code and determine the intent? The parties are frequently anonymous and have never interacted outside of the publication the smart contract to the blockchain and another party interacting with it. There is no basis for determining intent besides the code itself. Are you thinking that the contracts have analogs to legal contracts? Usually (exclusively?) they only mediate transactions and behavior that is contained within the blockchain itself. There isn't an exchanging of assets that exist externally to the blockchain like real estate. Although I think crypto fanatics think that the world will trend that way. Truly programmable money has never existed before. If more of our monetary infrastructure migrates to blockchains it will be interesting to see how current contract law adapts and is applied. If you want to argue with 'code is law' proponent, ask them how they feel about the DAO hack and ensuing hard fork of Ethereum. That was an interesting case where the ETH community as a whole decided that code was not in fact law.
  - dTal 5y ago
    >A judge is supposed to read the smart contract source code and determine the intent? If it's hard for a judge, it's presumably also hard for anyone using the smart contract. >There is no basis for determining intent besides the code itself. I'll bet you any frequently used contract has an associated website. Basically, conducting your business on a blockchain doesn't exempt you from the law. You - the squishy human at the end of the transaction - are not on the blockchain, and neither is the author of any smart contract you might use. As long as the law recognizes blockchain assets as valid consideration in contracts, contract law trumps blockchain law.
    - myownpetard 5y ago
      Does participation in a smart contract imply any kind of legal agreement? You're essentially interacting with an api/bot that's being hosted by whatever blockchain community at large. Anybody can publish anything, and any unrelated parties can interact with it. Here's a thought experiment for you. If I were to publish a public webpage where you entered a routing number into a textbox and money was immediately transferred from my account to the specified account for the purpose of sending money to a friend of mine, but somebody else found the website and entered their routing number and drained my account. Would I have legal recourse? This is essentially the Parity wallet exploit. The API was only slightly more complicated than the example above, initWallet(). It's an interesting paradigm shift. If contracts are automatically enforced, what features of the existing legal system are obsolete? If monetary/financial contracts are completely logically unambiguous in their execution and there is no need to appeal to a designated wielder of physical force to ensure their execution... I think that notion, which sounds unrealistic to me, is what appeals to lot of crypto absolutists. It fails in a lot of the ways that smart contracts currently struggle, how to computationally, and in an unbiased way, relate crypto to the world outside of the blockchain. A good example of this is oracles, which are so flimsy in so many situations. As you said we don't exist on the blockchain, the physical world doesn't exist on the blockchain, so how can we do away with our existing systems for mediating disputes, determining intent etc?

thfuran 5y ago

>All that is needed is for the legal system to recognise blockchains as the canonical record of ownership of real assets. Then theft via smart contract can't be theft because it acted on the canonical record of ownership. This also causes tons of other problems. What happens if someone loses access to their wallet? Now there's a house that simply can't ever be sold?

kybernetikos 5y ago
> There is no external trusted documentation that says what the intention of the code is. No, if someone fraudulently updated a canonical record of ownership, then the legal system can provide remedies. If it were me, I'd write the smart contract to enable corrections in case of a legal decision but that's at the choice of whomever sets up the smart contract that provides the canonical record of ownership. Same situation for if someone loses their keys. All these problems can be solved with appropriately written smart contacts.
- NovemberWhiskey 5y ago
  OK, so ... which courts of which legal jurisdictions can correct which contracts? Are courts in Guinea-Bissau allowed to correct contracts between counterparties in the US?
  - kybernetikos 5y ago
    This stuff is all normal when you're dealing with international contracts - it's not like nobody thought of doing international deals before satoshi. Some of the answers do depend on the specifics of course. If the asset being traded is US real estate for example I would expect the smart contract to be set up so it requires a US court decision to correct the register.
    - NovemberWhiskey 5y ago
      My point is that there's an entire subbranch of the law, generally called private international law, that has been created to deal with conflict of laws and jurisdictional issues. You're implying that there are simple deterministic rules to determine those kinds of questions but in fact it's a meta-problem.

deleted 5y ago

[deleted]