Newbie here, so please forgive me if this is a dumb question – I haven’t seen anything on the forum covering it yet.
The topic is about recourse and trust with regard to shareholders and the quasi-contracts we’re defining in many of our motions…
Using a FLOT motion as an example, we tend to say things like…
“Jimmy promises to be a member of FLOT for one year”
“Sally will have 24-hour response time”
“Bob will be paid 100 NBT assuming he meets the performance requirements defined above”
My concern with statements like this is that it’s open to a lot of interpretation – we might as well put a clause in here for arbitration (“Any controversy or claim arising out of or relating to this contract, or the breach thereof, shall be settled by arbitration administered by the American Arbitration Association in accordance with its Commercial Arbitration Rules”).
(Just to be clear, I don’t want to do that, but the point remains that we’re dealing in old-style contract situations here, which means that a human will have to make a decision – and we humans are fickle creatures .)
I know this whole “smart contracts” stuff is a bit far-fetched for now, but can we maybe toss around ideas for how we could put “whether or not the agreement was honored” into code somehow?
For example:
“… promises to be a member of FLOT for one year” -->
“Payment date == 1 year from now”
“… will have a 24-hour response time” -->
“Script will send pings randomly via e-mail. Captcha must be answered within 24-hours. If not, first 5 misses deduct up to 50% of compensation, beyond 5 voids this contract (aka, no compensation)”
“… will be paid 100 NBT” -->
Payment script is pre-sent and signed (by whom… I don’t know?) with a P2SH that is passed ahead of time?
(Side question: can we burn or refund any NBT not awarded by the pre-signed transaction?)
Hoping that someone much smarter than I am can tell me if I’m just talking crazy…
I assume we could automate payment in protocol with a delay so there’s a window for aborting payment through blockchain consensus in case shareholders believe the goals weren’t met.
Email would need to be handled centralisedly. If we had a messaging system … Or have a way for the person to put something in the blockchain as proof. Feels messy.
We’re probably all interested in these ideas, so keep them coming. Even if some may be infeasible they’re creatively engaging!
That’s a good point. We’re minting 40 NSR every minute or so, and most of these blocks are empty except for the NSR reward. Maybe we could piggyback on that?
Process coming to mind is…
A Bot sends a challenge to Alice via the blockchain
The challenge could be a simple captcha, with the goal being to avoid bots talking to bots…
Alice has to solve the captcha and sign the response, broadcasting it on the blockchain
At the end of the period, we just look at the response times and deduct based on the results…?
I think the whole aspect of “whether this will work or not” will come down to how much flexibility we have in the output script field… Ethereum obviously has tons, not sure how much we have :-/
The interesting thing here, which relates directly to compensation, is that the thing shareholders should be approving is a signed transaction rather than words saying “We’ll pay Jimmy 100 NBT”.
An empty block is not wasted space. Keeping the blockchain small is a boon for our network.
Shareholder’s word has sway enough to be as good as a nubit. Shareholders are the ultimate arbiters of conflict, such a hypothetical situation sounds controversial and we should develop consensus over it, on the blockchain if necessary.
I love the ideas, im open to all these potential changes, just giving my two cents about how it works currently.
I guess the question then becomes, what happens when we vote on a custodian to do a job, and they don’t follow through? In real-world terms, you’d either change the pay structure (half now, half on completion), but that would require two custodian votes, right?
Further, how are we mitigating risk with regard to up-front payment?
It seems that as of today we’re paying up-front for things (as they require capital). What would our recourse be if we granted a large set of NBT to someone and they either ran off with the funds, had their machine(s) compromised, (not saying anyone here is careless enough to do this, but kids in the house could have an accident like this), or some other incident where the funds were effectively “lost”?
What if they got caught up in a messy divorce and their spouse was demanding half of those funds as part of the marital assets? (This isn’t as far-fetched as you might think: Cryptsy) What if we’re dealing with someone who happens to have a serious gambling addiction, and figures “OK, I can wager this, I’m going to win it back in a bit anyway.” ?
I think right now we’re going on this idea that “everyone is going to act like a rational person and make rational decisions”, but those things tend to break down quickly as more people become involved…
I totally get that none of these questions are important now, but I think they’ll become incredibly important later, so it’s worth exploring…
Well spotted!
There’s another reason we need to think about this now:
Nu is not existing in any legal form.
It won’t be possible to have “The Nu network” sue people or corporations.
That’s one of the reasons that makes getting funds back from CCEDK (which are due since the February exchange hacks 2014) hard and why it’s dangerous to operate NuBots with Nu funds.
If I just hadn’t cleared all funds to FLOT (and hence Nu) addresses, it would have been hard to get hold of me.
Of course my exchange addresses point to me and Poloniex knows who I am.
But who would have been able to apply for a court order to make Poloniex hand over that information to enable Nu to file a law suit against me?
I dare say that nothing could ever make me abuse those funds, because it’s a matter of principle for me. My ethical conviction forbids doing such a thing.
Can I say that for other people as well?
What are we paying upfront for? Most stuff gets paid upon delivery. And yah, risking continually profitable contracts for some quick cash usually isnt the best idea.
ALP tends to get ramped up. My first ALP grant was like $150 or something. Once I had a logo and a website and a bunch of time and energy committed, shareholders started increasing my allowed trust.
It will be difficult and probably costly for NU to pursue any bad actors. That is why we have to be really careful for what and who we are voting for. Of course the risk is always there, this is a risky business.
A good reputation though is always a good advisor
That’s totally true when you’re dealing with the custodian and the custodian alone. However people still have lives outside of Nu are subject to legal jurisdictions and all that scary stuff…
I guess the scenario I’m trying to wrap my head around is when we grant a long-time and well-trusted custodian member a large number of NBT (for example, when we did for BhCnQrYrA5LZm871dtMQEXeU93gmqbhdrC, let’s pretend that wasn’t a multi-signature account, or that both signers are in the same legal jurisdiction or otherwise related).
For a few million dollars worth of NBT, if the custodian were to be sued or their spouse were to try to treat the digital currency assets as marital assets subject to a split, I suspect that an aggressive legal team would try to do quite a bit of hoop jumping to try to get their hands on the funds – and their recourse is “hand it over or you’re in contempt of court, so you go sit in jail”…
In short, I’m saying we can trust the custodian, and rightfully so, and still end up in a bind due to the fact that people have real lives…
I think we’re all in agreement that this is a very unlikely situation, however given the fact that it is possible, I’m hoping people smarter than me can either:
a) Explain why this is easy to fix,
b) Explain how this is easy to prevent, or
c) Explain how this actually isn’t possible, and I should take off my tin-foil hat: it’s all going to be OK.
I’m just not really all that comfortable with relying solely on the fact that it’s unlikely. Know what I mean?
What would you propose? Some way for shareholders to vote to destroy a certain output? What would prevent the malicious custodian from just moving the funds around to prevent shareholders from forming consensus fast enough? Pretty much all our contracts are made with exactly this scenario in mind, and the ones that are considered dangerous get collateralized. I think you’ll find the vast majority of our uncollateralized contracts do not carry with them enough funds to be susceptible to costly attacks like legal battles. We also try to spread out our funds amongst many operators, the 2 million NBT grant you are referencing was a very special case and by no means the usual situation (you noted yourself that it was multisig).
I think destroying output would be… scary – I don’t have data to prove it, but I suspect it’s a dangerous direction to go.
But you make a great point:
Do we have a standard way to collateralize contracts? And the amount required?
Or a definition of what exactly constitutes a potentially dangerous contract?
I literally have zero idea of what we could do here or whether this is even an actual possibility. Having some sort of way of enforcing collateralization of contracts that are deemed potentially dangerous seems like a possible direction though?
(I’m genuinely hoping that this thread ends with “OK cool, sounds like we’ve already got this all covered”.)
This isn’t going to end with ‘ok, cool’ because this is the entirety of how Nu works. Bitshares uses a formal definition of collateral which requires an overestimation of collateral and results in a completely illiquid network. We have no formal definition, in fact at our core we have only a 15% reserve, meaning our Nubits aren’t fully collateralized either, same as our contracts. The whole system operates off of fuzzy math, because the share price is a fuzzy thing. Anyway, one of the most interesting concepts (in my opinion) in way of collateralization is the T3 reserve:
Again, sorry for the newbie question, but I have to ask: Is there a reason I shouldn’t be worried at all by that? (Hopefully you’re reading that as me being curious and not trying to be snarky – I swear I’m not trying to be obnoxious…)
So theoretically, if someone was covertly buying up shares, and had a few million bucks to spare (which isn’t that rare nowadays), and they decided “fuck it, let’s mess with these people”, they could basically start granting NBT to their addresses and passing joke motions, etc?
(Again, totally asking out of curiosity – not trying to attack Nu, just want to understand the limits and the potential weaknesses and attack points…)
.)
Any chance you can point me at something to read about how this all works? Maybe I overlooked something?