[fnoof]

The example in the article had a way to enforce contract breaking - the person had to put up collateral until the work was done.

There’s problems with that particular mechanism, but in general if contracts can automatically decrease someone’s money, reputation, access etc, they can do enforcement.

[jgilias]

So, let's say I pay you 200 ETH and get an NFT signifying ownership of a flat in downtown Kinshasa. I fly to Kinshasa, find the key as you have described, start living in the flat. A year later as I come home I find that the key has been changed and someone else has moved in. They present a purchase agreement, as well as a deed.

What happens next?

[gandutraveler]

Exactly, the whole web3 blockchain movement seems to assume these contracts are legally binding in real world. For that to happen the same 'untrustworthy' government authority will have to trust the decentralized contracts on internet.

[_fizz_buzz_]

All these schemes always still might need some higher authority in the end e.g. who decides when the work is done? Putting up collateral only ensures that someone has the money, it does not ensure that one actually gets the money. Because defining when "the work" is done, can be really complicated in real life projects. Contracts in real life are complicated. Real life is messy etc.

[fnoof]

I’d imagine they would, kind of like the levels of arbitrators and courts today.

The article said the neighbours first vote that work is done. Most of the time that could work. But it also mentions the neighbours could collude to steal the collateral. In that case courts could get involved and force money be returned etc.

I’m very far from a legal expert, but smart contracts seem like a potentially useful tool, within the current system. Not as a complete replacement.

[jgilias]

> courts could get involved and force the money be returned

So, it's the government enforcing the contract.

EDIT: Just wanted to add that I actually completely agree with your last sentence!

[throwaway405769]

> who decides when the work is done?

This is part of the smart contract, which has to explicitly define the conditions on which the collateral is confiscated.

Getting real life data reliably into the blockchain is hard, but there are different approaches to solve this.

[roberrrrrrt]

The “different approaches to solve this” part, if it ever arrives, would be much more revolutionary than the blockchain itself.

[throwaway405769]

Aave has $11 billion deposited on it right now and safety of those funds depend completely on getting accurate price data to trigger liquidations. So you can say that the oracle problem is solved, at least for price data.

[roberrrrrrt]

Getting data in isn’t the big issue though, and we’ve had market data streams since forever. I’m talking about the example above, where a smart contract would need some way of knowing when to flip the “Bob has satisfactorily finished community refurbishment” flag. This would require an abundance of interoperable data sources for bizzare things. Where do I subscribe to the count(dogshit_pile_in_the_playground) stream, and who or what is publishing to it in a trust-less manner?

[throwaway405769]

Getting all the data in the world into the blockchain and coding smart contracts to infer judgement from it would be too complex and expensive.

A more practical approach is to transfer the funds to Bob once he clicks on the checkbox and have some lock-up period, so that Alice has the opportunity to trigger a dispute if she needs to.

Then the dispute can be resolved by a private court (composed of humans) that both Alice and Bob agreed on beforehand. See: https://kleros.io

[immibis]

Price data is easy. Price data is already visible on the blockchain because a lot of trading happens on the blockchain.

[soco]

So I have to trust the other party they will report in good faith on my delivered work. How is that trust working for Amazon product reviews? Why would be that net of lies any different for smart contracts?

[usrbinbash]

>but in general if contracts can automatically decrease someone’s money, reputation, access etc, they can do enforcement.

No, they cannot. They can reduce these values, but that by itself doesn't enforce anything in the real world. If the entitiy doesn't care about these values (for example because it was a fake account/identity/whatever) then the only enforcement can come from outside.

That's why the word "force" is in "enforcement". States work because, among other things, they ultimately have a monopoly on the application of force.

[newswasboring]

Do we really think everyone has money for collateral? Small businesses and individual people are already struggling with money, where will they get the collateral?

[immibis]

Reminds me of some of the newer blockchains e.g. I think Binance Smart Chain works like this.

They don't use PoW or PoS. Instead they run on centralized servers like traditional databases. Only, they run on 10 or 20 or 50 centralized servers run by different people and processing the same input and cross-checking each other. Anybody who has money on the chain can stake it to vote for one of the servers (so I guess it is PoS really). Although anyone can connect to the chain and process input, the N servers with the highest stake-votes are the ones that actually count. Also the server owner has to put up some crazy collateral (currently in the realm of $500,000 I think, this is determined by market mechanisms, it used to be lower) and if they are caught cheating they lose it, a process called "slashing". Even having your server go down can cause you to lose some collateral. Conversely you earn collateral while it is up (like in PoS).

So it's really a lot like a traditional database cluster with an enforcement mechanism, and that enforcement mechanism makes all the difference unless your attacker has millions of dollars to waste.

[XorNot]

No they can't, how could they? How is actionable events in the real world going to be translated without trust to a smart contract except by assessment by a third party?

[peoplefromibiza]

> the person had to put up collateral until the work was done

So only the people with money can participate?

[michaelt]

My new startup will loan you the non-fungible e-medallion you need to operate as a blockchain cab driver, in exchange for just 30% of your fares.