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Comment by Ataraxic | Hacker News Reader

That may be the premise, but has that actually be held up and recognized as such in courts in major countries? Like are there precedents regarding this?

At that point it's no longer a premise (for those particular countries), but until then it's just a supposition.

I think courts are wary to wade deeply into a new financial system like this but at the same time I find it hard to believe that the judiciary and the legislature would rule (in the long run) that they have no ability to "make things right".

If crypto grows as as many people suggest and you have some significant percentage of the country that has savings or investments tied to these smart contracts, if there is a loophole like in this case, you'd have lots of people writing their local or national representative about this. I find it hard to believe that politicians would tell the people they represent "tough luck code is law".

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> be held up and recognized as such in courts in major countries?

Only having a slight understanding of crypto, if local courts are required, what's the point of crypto? Why not use the existing financial systems, where all of this is built in?

The article even hints at this:

> [a crypto bro] criticized the team for turning to a centralized institution like the courts for help

But that's exactly the flaw of smart contracts, and why its promises will never work.

The hard part of contracts was never execution. The hard part was always conflict resolution and abidance by fair rules (i.e. "laws"). The hard part is what creates the overhead.

Smart contracts never solved the hard part. They remove the solution to the hard part, claiming the hard part is not needed at all. But the problems these solutions solve are the hard part. Pretending they don't exist is not "solving" anything.

There are so many examples of this. A minor can't enter into a contract. Severely mentally disabled can't either. Someone with a gun to their head can't either. It doesn't matter if they enter into a million dollar contract. That contract is invalid.

This is not "waste". This is the hard parts.

Eventually there will be smart contracts with assigned arbitrators capable of undoing dependent smart contract transactions, with the right to execute granted by a separate smart contract, which is controlled by a vote to be taken by a randomly selected set of peers in the community, who must first watch in total a video of the aggrieved and offending parties position their argument.

And arbitration contracts that can arbitrate the arbitration contracts, and so on.

And perhaps a smart contract to allow the amendment of existing contract, by vote of a group of wallets who’ve been elected by another smart contract, who’ve been elected by another smart contract with a larger pool of voters, and so on, until all stakeholders in the contract have had the chance to cast a vote, whose duration as a voter is limited to a 2-4 year term, before requiring another voting round.

Maybe. But you still need an override from real courts, when the contracts fail.

That's what courts are for. When someone finds an exploit in the smart contract there must be a "no that's clearly not what anyone meant. Nobody actually wanted all the money in the world to go to Hacker McHackerface".

If your assumption is that one of these contract layers is "perfect", then it's not realistic.

Thats why you have the arbitration contract… to allow an arbiter to undo the work, with the reasoning “this isn’t what was intended”

But anyways that was in jest; the crypto community will eventually recreate the same systems and bureaucracies already in play today as they run into all the edge cases that occur with traditional currency (fundamentally: currency carries provenance and is only fungible until its not, and the transfer of funds between two parties does not actually involve only the two parties — and lawyers write excessively defensive, excessively long contracts for a reason).

Crytocurrencies != smart contracts. The original premise of bitcoin was essentially to create a decentralized fiat currency. As its value grew the thesis then changed to equate more of a decentralized digital gold/inflation hedge that's easier to store and authenticate than actual gold.

So that's one use of crypto.

In the non Web3 world, we typically have to rely solely on the financial institution providing the service to make transactions. That is, we have to have a Paypal account to withdraw from Paypal. We can only buy/sell Robux on Roblox, etc. Smart contracts allow us to essentially utilize any provider we want without the provider having custody of the funds at any given time.

I can go to any dex I want and transact without depositing funds. The dex also cannot agree to perform a transaction and hold my funds hostage, like how Paypal screws over some of their merchants with their "internal investigations." I can also buy/sell coins that the dex mints (e.g. ORCA coin) anywhere I want. It's not tied to a single account nor is it tied to single exchange.

And that's without getting into NFTs, flash loans, LPs, and other features of Web3.

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