Protocols

“Protocol governance can come in many forms, these include bureaucratic rules, literal interpretations of religious texts, democracy, proposed block chain or P2P governance, statistics based governance, rule of law, and any other form of governance which seeks to provide a protocol as being ultimately sovereign as opposed to ultimate human judgement,” writes NIO.

The meaning of ‘protocol’ here? I’m assuming, until corrected, that it’s something like: A formalized procedure. If so, it elides a critical difference, because while “bureaucratic rules, literal interpretations of religious texts,” and constitutions tell people what to do, “proposed block chain or P2P governance” doesn’t.

A set of instructions opens itself to derision, if it ‘demands’ human compliance, without possessing the means to compel it. Constitutions, laws, and bureaucracies are massively — and demonstrably — vulnerable to subversion, because they require what they cannot enforce. It is exactly this problem that has propelled the development of software protocols that are intrinsically self-protective. The longest section of Satoshi Nakamoto’s Bitcoin paper (#11) is devoted to an examination of the system’s automatic defense capabilities. The problem is a serious and complicated one, but it is certainly not susceptible to resolution by armchair philosophizing about the essence of sovereignty, however much this latter proclaims its possession of the truth.

Claims to ‘truth’ demand trust, and trust is a social and technical problem (of ever increasing urgency). Mere assertion is certainly incapable of generating it. Only a trust engine can, and that has to be built, if it cannot be simply preserved, which — on this at least we are surely agreed? — it could not.

Bitcoin is only a stepping stone, and the scale of the step it enables remains obscure at this point. What is already clear, however, is that the principle of trustless (or open-source, automatically self-policing) protocols is concrete, in large part technical, and invulnerable to a priori dismissal. The theoretical difficulties involved have been largely solved, based upon a series of radical innovations in cryptography — public key systems and proof-of-work credentials, among others — compared to which the recent ‘advances’ of political philosophy, let alone governmental institutions, have been risible at best. If Byzantine Agreement is realizable, protocol subversion is exterminable. What then remains is productive work, in the direction of automatic or autonomized agoras.

Carlyle is a lament (admittedly, a rhetorically attractive, and insightful one). Satoshi Nakamoto has built something. The former is vindicated by progressive socio-political decay, the latter by the escape of self-protective catallaxy from the ruins.

Within a few decades, most of what still works on this planet will be on the blockchain.

ADDED: This is excellent. (Adam Back, via Twitter, describes it as the “Best article yet on what Bitcoin *is* & why decentralisation is necessary”.) The proposal of this post is that the conflict it outlines is obviously of massive importance. Those who think the entire problem of decentralized protocols is an irrelevant distraction from other things, are surely compelled to disagree. The XS position here is that trustless decentralization is worth defending. Clearly, that presupposes it’s something real (and consequential). As far as the NRx discussion is concerned, I’m going to assume that’s the matter at stake.

September 17, 2015admin 76 Comments »
FILED UNDER :Political economy

TAGGED WITH : ,

76 Responses to this entry

  • michael Says:

    Speaking of Protocols [of zion] ,
    Coulter has been caught in her BatGirl outfit removing any doubt she is a Dark knight

    http://www.telegraph.co.uk/women/womens-life/11871409/Ann-Coulter-racist-Jews-tweets-Meet-Americas-most-hated-woman.html

    [Reply]

    Posted on September 17th, 2015 at 2:24 pm Reply | Quote
  • Alrenous Says:

    Trustless systems aren’t exactly trustless, and the inaccuracy is likely to bite someone.

    It is true there is no third party you need trust, nor do you need trust your second party. You do, however, trust the ‘trustless’ system, and you trust the machine that is running it.

    While the ratio of trust reduction is extreme, it is not infinite.

    [Reply]

    admin Reply:

    Ultimately one runs into Cartesian demons and other metaphysical prompts to radical Pyrrhonism. An asymptote to absolute trustlessness, based on convincing incremental advances in cryptographic sophistication, is enough to keep the process moving forward.

    The alternative is trusting people — so it’s not a high-bar.

    [Reply]

    Posted on September 17th, 2015 at 3:29 pm Reply | Quote
  • Ossipago Says:

    It seems likely that we’ll get the chance to watch actual absolute-discretion systems (Carlyle) and actual zero-discretion systems (Satoshi) compete at some not-too-distant point in the future. That’s where the question will be resolved.

    [Reply]

    Blogospheroid Reply:

    The way I see this happening is when the geeks slowly move to block chain communities instead of working with corporations. Architects of the new block chains would have to be super creative to override the immediate profit motive so thoroughly. Let’s see.

    What I’ve heard in a few podcasts is that creative types are getting pissed off with amazon’s audible book service in terms of its lack of transparency. Maybe there is a good opportunity there for a block chain based system.

    [Reply]

    Posted on September 17th, 2015 at 4:26 pm Reply | Quote
  • Chris B Says:

    So you are rejecting Moldbug?

    [Reply]

    Frog Do Reply:

    Moldbug’s hypothetical government system was literally built off of cryptographic protocols. I don’t understand the idea that formalization implies abandoning Moldbug. Wasn’t that his whole point?

    [Reply]

    Chris B Reply:

    What?

    [Reply]

    Frog Do Reply:

    Exactly. What part of the above post implies rejecting Moldbug, and why?

    admin Reply:

    Yes. Weird that people deride the cryptolocked military point (which was crucially insightful) and defer to the Bitcoin dismissal (which was fundamentally misguided)

    [Reply]

    admin Reply:

    I agree with Moldbug that protocols incapable of self-protection (such as all existing constitutions, written and unwritten) are obfuscations. I have always disagreed with him insofar as he has argued that a protocol cannot be anything else (first in Quibbles with Moldbug (a text now lost, but dated soon after DE) and in every comment on Bitcoin I have ever made). It’s worth noting that Moldbug’s record on Bitcoin prophecy is clearly and unambiguously terrible.

    Sniffiness about what Satoshi Nakamoto — the Gödel of contract — has achieved can only be one (or more) of three things:
    1) Anti-capitalism
    2) Ignorance
    3) Insanity

    [Reply]

    Mercher Reply:

    Not lost: http://archive.is/25lm8

    [Reply]

    admin Reply:

    Thanks (really, a lot).

    Posted on September 17th, 2015 at 4:42 pm Reply | Quote
  • michael Says:

    @michael
    Hungary has been championing a “Christendom Protocol” and the other former Communists seem most receptive to this and Nationalist protocols.perhaps progressiveness is not as socialist or religious assumed .

    [Reply]

    Posted on September 17th, 2015 at 4:42 pm Reply | Quote
  • Stirner (@heresiologist) Says:

    Software is inherently reactionary. The codebase is slow to change, and any changes are carefully tested to make sure it is going to run properly.

    NRx (admin excepted) does not give proper weight to the importance of software for future governance. Yes, there has to be a sovereign, but he can only rule through his bureaucracy and legal system. The past century is clear evidence is that both of those political technologies are infinitely exploitable by progressives.

    Replace the bureaucracy and laws with code. Enable humans to use their native judgement where warranted However, design the system of controlling authorities to enable them to act appropriately – and not a smidgen more. Most importantly, use such a system to provide accountability of the bureaucracy to the sovereign.

    The patchwork needs an operating system, not a Constitution.

    [Reply]

    Chris B Reply:

    You’ve completely misread this one Stirner. Admin wants the software to be sovereign, not a mere tool at the sovereign’s disposal.

    [Reply]

    Stirner (@heresiologist) Reply:

    I fundamentally agree with admin on the importance of the blockchain, and the potential inherent in Distributed Autonomous Organizations. As for the rest, admin has his preferences, and I have mine. In any case, in this post admin is stating that it is only going to be the blockchain systems that survive the forthcoming Pozzing of Civilization.

    Out of the ashes of that, we are going to need to design new political institutions – but by then it will be much more obvious that the “Rule of Code” is far more robust than any “rule of law”.

    Check out https://www.ethereum.org/ and you can see that this is not just pie in the sky, but starting to occur today.

    [Reply]

    admin Reply:

    Once you’ve realized that you’d prefer money secured by algorithm rather than central bankers, you’ve already taken the decisive step.

    [Reply]

    michael Reply:

    I want mine secured by Tulips

    Posted on September 17th, 2015 at 5:26 pm Reply | Quote
  • Blogospheroid Says:

    I think that neoreaction’s un classifiable platypus wil be a political party whose internal governance is via block chain. Nio will reject it wholesale, but others may be much more puzzled at such a creature. And yes, such a thing will inevitably exist in a few years.

    [Reply]

    Posted on September 17th, 2015 at 5:58 pm Reply | Quote
  • Protocols | Reaction Times Says:

    […] Source: Outside In […]

    Posted on September 17th, 2015 at 6:19 pm Reply | Quote
  • Ossipago Says:

    Must we read Moldbug with Talmudic rigor? Is it a moral outrage to disagree with the Prophet?

    [Reply]

    Mike Reply:

    I don’t think any of us have ever had much time for his maunderings on Bitcoin.

    [Reply]

    Frog Do Reply:

    Again, where is the disagreement with Moldbug? It is not being carefully described, only carelessly asserted.

    [Reply]

    Posted on September 17th, 2015 at 8:22 pm Reply | Quote
  • Ossipago Says:

    @Ossipago I don’t assert one. Just trying to short circuit the possibility of an old blog post becoming the focal point for a holiness competition.

    [Reply]

    Frog Do Reply:

    I don’t think it’s turning into a holiness competition, I doubt any reasonable person thinks signalling on Mr. Land’s blog is going to increase their status in a measurably way.

    After some reflection, I think it is a misreading. The central objection would be a repitition of Carlyle’s “no government by steam” argument, being attributed directly to Moldbug. There are several issues with this, namely:

    First, bitcoin or the blockchain is not a decision structure. It is an algorithm that exists and can be used to help solve the Byzantine generals problem, a common problem in governence. It does not completely solve the problem, you still need to set up a web of trust and do the usual cryptographic due diligence. Most importantly it exists, and everyone will react to it in some way, it is not going to be avoidable.

    Second, even if the assertion that government-by-steam was a claim being made, recall that Moldbug does not ascribe to Carlyle completely. To disagree with Carlyle is not to disagree with Moldbug necessarily.

    Thirdly, on a meta level, the confusion seems to me in some mysterious way to itself demonstrate the necessity of the blockchain.

    If I am wrong anywhere, please point it out clearly.

    [Reply]

    Dark Psy-Ops Reply:

    All looks good from here. There’s no better way to secure spiritual authority (to use a Carlyle-approved term) then by placing it on the blockchain. From OP:

    “A set of instructions opens itself to derision, if it ‘demands’ human compliance, without possessing the means to compel it. Constitutions, laws, and bureaucracies are massively — and demonstrably — vulnerable to subversion, because they require what they cannot enforce. It is exactly this problem that has propelled the development of software protocols that are intrinsically self-protective.”

    So public government (laws, bureaucracy etc.) is old tech made necessary by limited means of consolidation, whereas the blockchain allows privatization (self-protection) on unprecedented scale. Anyone who respected the right of men to organize on the basis of trust and leadership would welcome the blockchain as an innovation. Surely Urbit itself is a step toward protocol governance (ie. privatization) and not the reverse (ie. informal clamoring for democratic status)?

    Sovereignty on the blockchain becomes formalized and invested authority, where exit is given precedence of right over voice, where hard money philosophy becomes sole government methodology, and where there is no counterfeiting trust with paper bills, and it’s all being built right into the selective mechanics of an amplified technicity. Whatever the flaws, it’s a darn sight better than trusting in the Absolute Judgement of the faces we see in the clouds.

    [Reply]

    Chris B Reply:

    “Sovereignty on the blockchain becomes formalized” that’s not what Admin is saying. He is advocating blockchain and algos as sovereign – http://www.ufblog.net/the-program/

    This whole “blockchain will allow us to dance in the meadows with no oppression” has a distinct techno-communist, or at a minimum techno-whig, ring to it.

    admin Reply:

    You don’t need the ridiculous straw-man to make your point. Distributed self-policing agoras are intensified social Darwinism, not communist Utopia.

    Dark Psy-Ops Reply:

    I think you’re underestimating the extent to which automatized, industrial software can defend a digital economy from primitive coup attempts. Have you even been listening to the other generals?

    SVErshov Reply:

    @Frog Do “bitcoin or the blockchain is not a decision structure”

    that is a good point. but universality of blockchain consept is in its portability. it can be ported to any software or OS and software. It can be ported to System Dynamics and provide decision structure. I’m micro signaling for SD mainly because all those hystorical analogies Nrx territorising on are not going to serve as a relianle analytical tool any more. current inefficiencies of human systems in its complexities. to understand future of the world in terms of SD very simple model can be sufficient.

    [Reply]

    Posted on September 17th, 2015 at 10:30 pm Reply | Quote
  • wenshuang Says:

    The difference between these “protocols” is the difference between qualitative and quantitative information, no? Bitcoin has no necessary semantic content, whereas all of the others do. Am I missing something that complicates this? NIO is just confused here.

    [Reply]

    Posted on September 18th, 2015 at 12:50 am Reply | Quote
  • Chris B Says:

    I’m completely lost by this whole post and thread. The level of wishfull thinking and attempts at argument deflection and obfuscations (holyness spiral from MM/ MM as Talmud/ dismissing Carlyle for unrelated error) is astonishing.
    There also seems to be a hazy idea that entire nations and organisations can be put on a block chain or something. It is just really flaky thinking. My whole point was a fairly simple one, and one which Moldbug makes (and is central to the avocation of putting someone in charge) which is that rule by steam (yeah from Carlyle, he’s going nowhere) is invitation to anarchy and chaos. Governanance is not computable either by “Beta” systems like constitutions or blockchain, it just translates to no governance, which you are advocating under all the verbal fluff.

    Let’s take Blockchain as a serious concept as governance briefly, which I don’t think is warranted at all, given no one has vaguely explained how it will work; the question that arises is who decides on the rule coded into it? if person then the person rules. This is akin to the judiciary dictatorship of democracy. oops. What if events occur which are not forseen by the code? well someone has to update it to take that into account. Who are they? person.

    Your only escape clause is to invoke AI, which quite frankly is akin to trying to do political theory with the serious assumption of an alien invasion. It is also demonstration that the system as sovereign is so unworkable you need to remove humans, at which point you should really stop and think long and hard.

    [Reply]

    Dark Psy-Ops Reply:

    lol… so privatized capitalist enterprise is ‘akin’ to a public democratic court system? Whose on trial may I ask?

    [Reply]

    Chris B Reply:

    “Lol…wow just wow.”

    Your lack of engagement with arguments and mindless cheer leading for admin is becoming tiresome. Either explain your position or provide an insightful critique.

    [Reply]

    Dark Psy-Ops Reply:

    Your resentment is showing

    admin Reply:

    I’m not sure why this has to get bad-tempered. Isn’t it a topic that needs exploring? No one here — to the best of my understanding — has a significant role in either attempting to regulate blockchains, or in building them, so high levels of emotional activation seem out of place. It would surely be OK for everyone to chill out and try to enjoy the dramatic questions of our epoch. (The mass-killing is still some distance down the road.)

    Frog Do Reply:

    There is a disturbing lack of clarity in the conversation is something many can agree on.

    Please explain what exactly what thinking is wishful, and at what level, instead of asserting it. This is mostly just trolling, and worse, trolling with weak bait.

    I am begining to think accusations of holiness spirialng is becoming a holiness signal in itself. No one is gaining in practical social status from this conversation.

    What arguments are being deflected, in your view, and why. Assertions without targets are contributing to the confusion.

    Where is it being asserted that entire nations can be put on the blockchain, and what do you mean by that.

    Your fairly simple point was answered above, by me. Where is the claim that bitcoin or the blockchain is a decision structure?

    Carlyle is being dismissed for an unrelated error despite rule-by-steam being constantly addressed, so I’m not sure how the objection is relavant.

    ——

    Finally, where is Mr. Land asserting that bitcoin or the blockchain is a sovereign structure? As in, something that makes decisions? Mr. Land is asserting an important point. The blockchain exists, as a matter of natural law that implies consequences, and those consequences include solving previously intractable political problems. The blockchain is not about removing human beings from a system, it is about letting them communicate in a novel way.

    [Reply]

    michael Reply:

    for instance?
    I have said many times technology could replace a lot of government function, I have been thinking about p2p big data basically privatizing govt by disrupting traditional govt services like poice sanitation education the way uber et al. how would a block chain work. at first i thought it might kill fiat now not so sure that will be case contracts yes sounds great govt ?-

    [Reply]

    admin Reply:

    I’m happy to defend the proposition that an actualized self-protective protocol (which would ultimately require a military component — that’s arriving separately) would have to count as a sovereign structure. Sovereign property is capable of self-defense. That’s the whole of the definition, as far as I can see.

    [Reply]

    Chris B Reply:

    @Frog do

    “Where is it being asserted that entire nations can be put on the blockchain, and what do you mean by that” and “Your fairly simple point was answered above, by me. Where is the claim that bitcoin or the blockchain is a decision structure?” Land is as he admits on the thread, as he also does on his UF blog here (http://www.ufblog.net/the-program/)

    “What arguments are being deflected, in your view, and why. Assertions without targets are contributing to the confusion.” Numerous.
    Blogspheroid and his assertion of NRx governance being placed on blockchain. This is fantasy, the likes of which Szabo calls out here oddly enough (https://letstalkbitcoin.com/blog/post/lets-talk-bitcoin-246-smart-contracts-with-nick-szabo)
    Ossipago There is really nothing to ground his statements, other than in wish. He’s just asserted the absolute future existence of the zero discretion system, ok, sure.
    Dark Psyops statements are again wish. A set of assertion based on a wish of what technology will do. No grounding in logic, observation or understanding of society.
    and admin is just constant wish for his “fanged freedom”, I keep trying to latch on to a coherent argument, but it all boils down to “I wan’t this to happen, and anyone who disagrees is ignorant, anti-capitalist, insane, an “armchair philosopher”

    “Carlyle is being dismissed for an unrelated error despite rule-by-steam being constantly addressed, so I’m not sure how the objection is relevant.” It is not being addressed at all, how about this slight of hand? –

    “If so, it elides a critical difference, because while “bureaucratic rules, literal interpretations of religious texts,” and constitutions tell people what to do, “proposed block chain or P2P governance” doesn’t.”

    Ok, my point on the post (and a very carlylean point) was that protocols cannot capture reality, and a such become disconnected from reality, which occasions the protocol’s rejection, or (what really happens) A) a further level of obscurity is added to cover up and correct, or (as has demonstrably happened) B) the system acts to *deny reality*, as seen in the Haval’s grocer situation (you could claim easily both A and B occur constantly.) But instead of arguing this, he has shifted the discussion to how automated the protocol can be, and how true to itself it can be without further input, which in the Haval situation would be an even greater travesty if it were automated, don’t you think?

    There is a emotional investment in having no rule. They start with the conclusion they wish for, then fill in the gaps afterwards without recourse to rigorous analysis of it is reality.

    [Reply]

    admin Reply:

    Why not slow down? Reality isn’t going anywhere. The relation between the blockchain and reality is actually quite interesting. Definitely worth taking a few breaths to think about.

    (I’m only harassing you like this because you really do have a persuasive claim to be the most orthodox Moldbuggian in NRx right now — which means you’re NRx-central — and with great [well, not exactly power, but] something comes great responsibility. Most relevantly: calm and patience. This stuff absolutely isn’t going away, so you’d benefit hugely by responding to it with tranquil condescension, rather than frenzied panic.)

    Frog Do Reply:

    Thank you for the reply, Chris B. This, and Mr. Land’s responses, have improved my understanding of the conversation. I don’t think I have anything further to add or question, so I will stop here.

    admin Reply:

    “… given no one has vaguely explained how it will work” — What does this even mean? The Bitcoin paper explains how it works, and now it works. You seem to want to wish away a demonstrated fact with an armchair argument. You might as well say, “But how do we know that digital computers would actually work?”

    Do you think the Internet works? Or is that also stuck in the limbo of unproven tech-comm speculation?

    It’s a serious question. It really looks as if you’re arguing that decentralized networks are some kind of fantasy technology.

    [Reply]

    Raymund Eich Reply:

    Chris B, I agree the blockchain isn’t and can’t be sovereign–it’s just a massively redundant, readily accessible, unforgeable database of transactions. Admin is using “blockchain” as a shorthand for things it enables, like smart contracts.

    Contracts are a straightforward concept. A and B agree that A will give B item X, and B will pay A $Y. The problem in today’s world comes if one party breaches the contract. Off to court, and after many hours are billed by both sides’ lawyers, the judge declares one party the winner and decrees what the loser must do, with threat of contempt of court, seizure of assets, etc. compelling the loser to do it.

    Smart contracts–where the contract, both sides’ proofs of compliance, and both sides’ remedies for breach are stored in the blockchain–are superior in a number of ways. No legal fees and much quicker dispute settlement will be the first things to lead people and businesses to use smart contracts. Another benefit, settlement won’t require third parties (judges, bailiffs, sheriffs, marshals, and other supposed deputies of the sovereign) to enforce. Finally, and perhaps most important to NRx, by removing the discretion of lawyers and judges to argue and decide cases, a component of the leftist ratchet is removed. Namely, there’s no room for a lawyer (trained in the Cathedral’s finest law schools) to argue “the contract might be lawful, but it’s unjust, and that’s why it should be voided” and there’s no opportunity for a judge (ditto) to agree.

    And before you argue smart contracts would only apply to commercial deals, remember that people still talk about the “marriage contract.” Thinking even bigger, in medieval Europe, political rights, duties, and privileges were considered pieces of private property, and another term for “item X” is “a piece of private property.” In a smart contract world, political structures would emerge bottom-up from all the interpersonal contracts people and businesses would enter into.

    the question that arises is who decides on the rule coded into it? if person then the person rules.

    In a blockchain-enabled smart contract world, both parties agreeing to that contract rule. If you like Schmitt’s formulation, together they agree on the exception, so therefore, they’re the sovereign in the realm of that contract. Multiplied by the billions of contracts entered into by all the citizens of that world.

    This is akin to the judiciary dictatorship of democracy. oops.

    My comments above about removing the discretion of lawyers and judges speak to this. A democracy raises up judges who decree the law for all subjects. Smart contracts establish a mutually-agreed law for two citizens.

    What if events occur which are not forseen by the code? well someone has to update it to take that into account. Who are they? person.

    Competent coders today build error-handling routines into software. Competent lawyers today cover various contingencies in contracts. Still, human foresight only goes so far. So when the black swan comes, the smart contract throws up an error message, returns both parties to a restore point, and aborts. The parties can then decide whether to rewrite the smart contract in view of the black swan, i.e., the parties again exercise their sovereignty.

    [Reply]

    scientism Reply:

    Why do people defect from non-smart contracts? Why wouldn’t they defect from smart contracts at the same rate? If there’s a way to get out of it – and there has to be – then people can just defect for the same reasons they do now. There’s no difference between smart contracts and regular contracts, except you might save some administrative work in the ordinary case (although I doubt it). You still need a legal system surrounding it. People will just go to court to force other people to supply the cryptographic key. The cases will be judged base on human interpretations of what the function of the smart contract was supposed to be and whether it conforms to laws and norm for smart contracts.

    Really, a smart contract is indistinguishable from the case of putting some good in a locked room and denying somebody the key except under certain conditions. The conditions are necessarily a matter of human interpretation. Even if you put an elaborate locking mechanism on the door, your client can still dispute whether it was or was not what he agreed to. Human foresight can no more bake every possibility into code than it can create the perfect written contract. Arguably, trying to do it in code would be worse, since people generally have a hard time understanding code, including those who write it, and, just as you need a lawyer to interpret contracts now, you’d need a lawyer and an engineer to interpret a smart contract of any complexity. This all just sounds like a recipe for nightmarish growth in bureaucracy, where everything gets tied into a poorly understood maze of smart contracts and nobody really knows what they’re signing up for or what happens under conditions nobody thought of beforehand. This becomes especially true if you have many different such contracts interacting with each other. You can easily create conditions where interacting contracts lead to massive, across the board failures due to unforeseen conflicts between the conditions they enforce.

    I think NIO’s point is that all this stuff just adds another layer of obfuscation to who’s in charge. It divides sovereignty and the inevitable result is worse governance. The point is this: there will always be a (human) sovereign, we will always fall back on human judgement, and our political thought must recognise this. Any political thought that does not uphold human judgement, that tries to put it in a box, inevitably obfuscates who’s in charge and therefore impairs governance.

    [Reply]

    Frog Do Reply:

    It doesn’t add a layer of obfuscation, it removes mulitple layers. Once again, for effect: there are always people on both sides of the terminal. This hero-worship of the absolute sovereign makes me think of King Canute trying to command the tides. He cannot! Even sovereigns follow natural law. The blockchain exists whether or not you want it to.

    Raymund Eich Reply:

    Why do people defect from non-smart contracts? Why wouldn’t they defect from smart contracts at the same rate? If there’s a way to get out of it – and there has to be – then people can just defect for the same reasons they do now.

    A rational actor defects if benefit(defection) – cost(defection) > benefit(compliance) – cost(compliance). In a legal system where contract enforcement depends on the discretion of third-parties, it’s easy to discount cost(defection). “I’ll find an expert witness who’ll testify the widgets were up to spec when they left my factory.” “I’ll find a lawyer who’ll argue the pre-nup is invalid because I was coerced into signing it, because my husband wouldn’t marry me if I didn’t.” “Even if the jury finds for the other party, my lawyer will get me out of paying punitive damages and the other party’s legal fees.” Smart contracts reduce discounting cost(defection), and therefore make defection less likely.

    Really, a smart contract is indistinguishable from the case of putting some good in a locked room and denying somebody the key except under certain conditions. The conditions are necessarily a matter of human interpretation.

    No, a smart contract is indistinguishable from me posting to the Internet a video of a widget leaving my fab, going through QC testing, getting packaged, and getting handed off to the shipping company. Along with posting the QC test results, the test equipment diagnostics, and the shipping company’s receipt. Then, if you don’t pay me for that widget in the agreed-on time, my bot searches for your posted video of you receiving the widget, QC testing it, and entering it into your internal processes, and if it doesn’t find that video, my other bot makes a direct withdrawal from your bank account.

    It divides sovereignty and the inevitable result is worse governance.

    No, divided and overlapping sovereignty inevitably results in worse governance. Key distinction.

    Posted on September 18th, 2015 at 3:21 am Reply | Quote
  • Aeroguy Says:

    Do the contracts then interface with the department of truth for variable actions/outcomes that would affect the settlement of the contract. As constructed it’s practical application is narrow, how does it resolve issues when one party finds a bug/loophole in the contract code, who has the authority to issue a patch. A marriage contract for instance, it’s coded that the contract is void if the woman cheats, how is code supposed to verify that, short of running back to trusted third party to act as a department of truth? Even if we had an operational antiversity, with that kind of power interested in it, it’s truths would be quickly subverted. It’s the same reason no one takes Kgaard up on any of his bets, both sides can never agree on a source for numbers to verify who won.

    I think it’s still powerful, wonderful and can replace many third parties, but it’s not enough to replace judges/courts entirely.

    [Reply]

    Raymund Eich Reply:

    A marriage contract for instance, it’s coded that the contract is void if the woman cheats, how is code supposed to verify that, short of running back to trusted third party to act as a department of truth?

    You forgot that, as part of the contract, the woman has intravaginal sensors for latex, semen, etc., which always post to the blockchain. No trusted third party required. Wait, you would need a sensor diagnostics provider to verify or rebut the “Oh, honey, the sensor gave a false positive” excuse, but since the marriage contract requires a sensor diagnostics provider to have a 99% or better reliability rating, based on transactions posted to the blockchain, the required level of trust is a lot lower than what we have now.

    I think it’s still powerful, wonderful and can replace many third parties, but it’s not enough to replace judges/courts entirely.

    As admin said upthread, if it’s better than an all-discretion legal system. it’s an improvement, and being better than human discretion is a pretty low bar.

    [Reply]

    Chris B Reply:

    You forgot that, as part of the contract, the woman has intravaginal sensors for latex, semen, etc., which always post to the blockchain. No trusted third party required. Wait, you would need a sensor diagnostics provider to verify or rebut the “Oh, honey, the sensor gave a false positive” excuse, but since the marriage contract requires a sensor diagnostics provider to have a 99% or better reliability rating, based on transactions posted to the blockchain, the required level of trust is a lot lower than what we have now.

    So, the contract cannot cover reality in sufficient detail, and is not self-contained. Just a massive extension on surveillance in this instance? It reminds me of Lessig’s “law as code” with the argument that all those “the internet is gonna create a anarchist utopia” people were complete muppets, and that the internet would really occasion even greater control by government. Imagine what opportunities Blockchain contracts create?

    [Reply]

    Raymund Eich Reply:

    Except data posted to the blockchain is encrypted so only the parties to the smart contract can access it.

    scientism Reply:

    This is horrifying vision that should probably serve to refute the whole idea of self-enforcing contracts. Presumably you think it would be okay because people would enter into these contracts voluntarily, but it’s hard to see why anyone would voluntarily enter into contracts that require surveillance of this magnitude, so none of this is really feasible.

    [Reply]

    Raymund Eich Reply:

    @scientism, oh, it might be a tough sell, mightn’t it? 😉

    Would it be more palatable to you if the husband agreed to a comparable sensor?

    Would it be more palatable to you if the surveillance data, being stored on the blockchain, is only accessible to and readable by the husband and wife, and then only for purposes of verifying contract compliance?

    Raymund Eich Reply:

    Joking aside, your horror at this idea doesn’t even remotely “refute the whole idea of self-enforcing contracts.” It might refute it for your vision of the ideal society. That’s fine. That’s what Patchwork is for.

    scientism Reply:

    @Raymund Eich

    The example you gave needs to be multiplied across many domains. That’s the source of my horror. God knows how many sensors we’d have to shove into various parts of our bodies to bring this vision of self-enforcing contracts to fruition. A medical insurance smart contract would probably be enough turn you into a cyborg. When it comes to questions of intent, we’d all need neural interfaces. You’d still have the problem of unforeseen conflicts between different contracts, bugs in the system, etc.

    Posted on September 18th, 2015 at 3:57 pm Reply | Quote
  • Chris B Says:

    @Raymund_ Eich
    “No, divided and overlapping sovereignty inevitably results in worse governance. Key distinction.” Divided sovereignty impedes on the sovereign’s ability to act in accordance with need, which creates worse governance. Overlapping is basically conflict, either latent or open.

    [Reply]

    Chris B Reply:

    **correction** impedes on the government’s ability to act in accordance with need **

    [Reply]

    Posted on September 18th, 2015 at 5:50 pm Reply | Quote
  • Raymund Eich Says:

    **counter-correction** Divided sovereignty impedes on the government’s ability to act in accordance with what it alleges its subjects need.

    [Reply]

    chris b Reply:

    That is the sovereigns decisions which having the might to decide, it has right to decide. Subjects are in no place to make that call, and western (anglo) political tradition in claiming that is their call isthe problem.

    [Reply]

    admin Reply:

    Our sovereign power is The Cathedral. Worth remembering that, in cases where it wanders into people’s fantasies in the robes of a Carlylean hero.

    [Reply]

    Posted on September 18th, 2015 at 6:02 pm Reply | Quote
  • Warg Franklin Says:

    Lots of sillyness ITT.

    Bitcoin, etc are not sovereign any more than a mountain is. I don’t know if that concept is useful here.

    What bitcoin does, like the invention of the press and the gun and the internet, is change the nature of the territory. Agents and systems still compete within the territory, and it seems likely that some agents may still acquire the ultimate monopoly, which is the monopoly on force, and thus be “sovereign” in the usual sense.

    On the other hand, the system may cash out so that some agents and their property cannot be corced on certain points in certain ways. Or that somehow unorganized defense comes to beat organized offense. I don’t know. Seems the way to bet is that for the foreseeable future, human sovereignty at some level, whether global or local, is a thing.

    Do note that the whole idea of patchwork is that the territory becomes such that subglobal minority sovereignty is possible. Whether we get patchwork of small territories or some even finer grained patchwork of tribes or something seems open ended. The question here is really whether we expect future technological change to support or undermine multipolar sovereignty in this way, and which technologies can push on these questions in a desirable way.

    As for how you could do distributed bulletproof court: the contract, and thus the law, is cold hard code on the etherium blockchain or something. Its only problem is that it does not know the facts, and cannot establish them in an automated manner. Easy enough to hire an anonymous jury to which the disputants present evidence, and from which is acquired a trustworthy machine-readable account of the facts. Would take quite a bit of thought to figure out the exact rules, but seems to me we could do something interesting along these lines. Obviously it would only scale so big.

    What I would really be interested in is an automatic distributed antiversity. Somehow to collect and present evidence and proclaim the facts on a variety of controversial questions, without any sole judgement nodes that can be subverted by politics.

    [Reply]

    admin Reply:

    “What I would really be interested in is an automatic distributed antiversity.” Have you seen this?

    [Reply]

    Aeroguy Reply:

    So when are you going to start making bets with Kgaard? We can’t agree on what to measure in economics let alone trust the people collecting the data, we can’t even get temperature data without interpolation. When truth is applied to power, power answers back. Truth for it’s own sake can be pursued, but vest truth with power and the truth becomes political. The truth has teeth of it’s own to the extent that actors actually perceive it, humans however are famous for being utterly blind to it.

    [Reply]

    Posted on September 18th, 2015 at 8:15 pm Reply | Quote
  • michael Says:

    @Chris B unless youre saying these smart contracts will have a forfeiture bond secured to them [which would be a huge drag tying up resources until a contract is complete] then they dont guarantee shit. and im pretty sure you cant write something in code that cant be written in english. so they are right it only means what was once in legalese is now legalese translated into code. Im sure we can find some uses but revolutionary contacts i dont see. and as money how is it really different from fiat. -oh you cant make more of it,yeah so the plan is to use decimal places to divide it, hmm think about that for a bit. now it might continue as just another asset class one more thing someone might want to move in and out of.

    [Reply]

    Dark Psy-Ops Reply:

    “oh you cant make more of it,yeah so the plan is to use decimal places to divide it, hmm think about that for a bit.”

    The crucial difference is that printing paper money does not ‘divide’ a hard currency it inflates a soft one. IOW Bitcoin supply stays the same (ie. bank loans no longer substitute for “money creation”). Liability costs are minimized because there’s no bailing out failed contracts with magical (fiat) bookkeeping. No usurious Jew would sign off on a loan made in gold bullion if they didn’t think they’ll get it back (with interest). Compare the incentives of decentralized actors in smart contracts to the ‘money creating’ debt farm of central bankers (as witnessed in the housing bubble).

    [Reply]

    michael Reply:

    Im not convinced it really matters whether you inflate or divide or that we should care. what we should care about is how well does our currency du jour do for maintaining our wealth.Currencies are but a temporary store of wealth as well a medium of exchange.If money is diluted prices rise [except that seems to be in question recently] this is bad for people who store wealth in the currency but neutral for those who stored in other assets . If BTC becomes popular the theory goes we will need so much more of it it will rise in value and use smaller denominations .0001 BTC will buy what 1.0 BTC buys today. That will be good for those storing wealth in BTC not so much for others.Suppose we could somehow get past this transition while most people continued to store wealth in anything but BTC and yet miraculously BTC continued to increase in relation currencies only, enriching first adopters, while allowing the holders of the worlds wealth to still value their wealth in other currencies and assets. This is hard to imagine BTC would have to soak up excess QE but cental bankers would still be doing their thing with BTC being just another piece of the puzzle. But for arguments sake BTC is now worth say US M2 and no one has lost wealth [pretty much impossible either currency is devalued taking everything with it [which could be argued is just] or BTC in inflated and adds to world currency inflation.] but for arguments sake that doesnt happen all is fine USG has a competitive currency that cant be manipulated and we have the worlds first trillionairs.Lets say the worlds govts now treaty to start phasing out national currency by converting it to BTC [hmm what would they buy the BTC with] and this still doesn’t effect peoples wealth even though they have a lot less ways of measuring it converting it etc. The thinking seems to be this would prevent governments from taking on debt what of course it would not. they like everyone else would continue to contract to borrow at interest [which is how the west got rich BTW it was the Italian Medicis later sweedish and dutch not the joos who developed it] so BTC will not change government debt or fractional reserve banking. It might limit some of the ways they hide transfer of the debt to the people but ultimately the people always owe the debt anyway.It might make for unintended consequences for nations in default war might change a nations BTC reserves could be set to self destruct or if these smart contracts were successful [which i doubt tying up alll funds for other uses] it might encourage wars.
    I think BTC is interesting and likely will have some uses perhaps even great ones but the paths forward are not clear
    I hate govt debt and understand the problems with Fractional reserve banking, but their are advantages too. Perhaps something as simple as balanced budget laws would be the solution. BTC also is as fiat as any currency Im not a gold bug but they have a point that its practical applications and almost genetically inbeded notional value is worth noting whats important is wealth is not currency currency value even BTC is psychological not simply a function of supply.Tulip bulbs did not crash from oversupply someone just suddenly lost faith and it spread like fire, things like land building companies gold oils while subject to wide swings even below production costs at times eventually are worth something again not so much with curencies even BTC could have a tulip bulb moment.
    all that said im sure im as angry about our nations finances as any sane person

    [Reply]

    Dark Psy-Ops Reply:

    “If BTC becomes popular the theory goes we will need so much more of it it will rise in value and use smaller denominations .0001 BTC will buy what 1.0 BTC buys today. That will be good for those storing wealth in BTC not so much for others.”

    Right, so bitcoin nothing like a fiat currency because it increases in value for its holders as adoption (circulation) rates rise, while the exact opposite is true for an inflated currency (it weakens in value).

    “Perhaps something as simple as balanced budget laws would be the solution.”

    But then we’re still just looking to further regulate an already massively centralized KrugmanCoin.

    “The thinking seems to be this would prevent governments from taking on debt what of course it would not.”

    It would change how debt is taken on because debt would no longer be considered a default increase in the money supply.

    https://en.wikipedia.org/wiki/Money_creation
    “When a bank makes a loan, a deposit is created at the same time in the borrower’s bank account. In that way, new money is created as a bookkeeping entry…”

    Posted on September 19th, 2015 at 2:36 am Reply | Quote
  • SanguineEmpiricist Says:

    I think a path forward for us decentralists is via an intelligently applied epistemology of risk

    sort of small is beautiful –> leveraging what nassim has been talking about all these years –> make sure errors explode at the local scale and not some monolithic state and we somehow maneuver with that forward, the hard part is getting it in writing since most of our respect for decentralization is via tacit knowledge

    [Reply]

    SanguineEmpiricist Reply:

    *removing agent/principal problems is a big one

    [Reply]

    Posted on September 19th, 2015 at 7:39 am Reply | Quote
  • vimothy Says:

    A true sovereign’s rule must (till now) ultimately be grounded in an appeal to authority, and this authority must be legitimised. The Blackchain, on the other hand, rules through power alone, without need for legitimisation.

    Is this the neoreactionary ideal?

    [Reply]

    admin Reply:

    “Is this the neoreactionary ideal?” Zero political legitimation is. Free exit provides all necessary control.

    [Reply]

    vimothy Reply:

    “Zero political legitimation” leaves only rule by arbitrary power.

    [Reply]

    admin Reply:

    That’s all we ever have. Some arbitrary powers have fancy clothes to dazzle the gullible (“popular legitimation” being currently fashionable).

    Businesses have zero political legitimation, and a government run as an efficient business is the NeoCam model (as you surely know).

    Posted on September 20th, 2015 at 10:23 am Reply | Quote
  • michael Says:

    @michael
    meanwhile I have a house and other hard assets like gold and timberland that are falling in value against BTC as is my savings in the legacy currency its destroying, meanwhile Goldman and some Zuckerberg types are becoming trillionairs.
    Actually printing money is only one and the clumsiest of ways governments incur debt or transfer it to the people. debasing your currency if its a reserve currency could even be arguably a good for the home team. The people who elect polititions based on how muh free stuff they buy them deserve this unless you have 51% invaders voting for this then its called mugging. Governments also issue bonds and run deficits. this will not stop those bonds will continue to be re leveraged and all manner of shenanagans. but fractional reserve banking is not something to outlaw lightly. The two things that ought to be done is make it impossible for the government to incur debt and even this is quite limiting but seems the only way. the other thing is private institutions can not be bailed out which means they have to be made to not effect us when they blow up, making them small puts them at a disadvantage to others who remain large another solution is needed. If governments could not run debts and print fiat becomes BTC effectivly.look at what one currency is doing in europe to soveriegnity

    [Reply]

    Posted on September 20th, 2015 at 2:08 pm Reply | Quote
  • This Week in Reaction (2015/09/20) | The Reactivity Place Says:

    […] David Frum noticing what hitherto only hatful white supreme-acists were noticing. And here is Land’s fully articulated response NIOs articles last week on the shortcomings of protocol and the warping of truthfulness. To be […]

    Posted on September 23rd, 2015 at 8:09 pm Reply | Quote

Leave a comment