Tezos -- "The first self-amending cryptographic ledger"

I wonder how it differs from nushares, how secure it is.

What is Tezos?
Tezos has been in active development since summer 2014, when we noticed that Bitcoin suffered from a critical governance problem. When our predictions came true almost two years later, we redoubled our efforts. Crypto-currencies need governance by consensus, not by roundtable. Tezos is the first, and only blockhain implementation putting stakeholders in charge of governance.Tezos is currently undergoing testing and bug fixes to move out of its prototype phase. We hope to release the alpha in summer 2016.

The lack of an explicit governance mechanism has created deep problems for Bitcoin. Ethereum, with the DAO-related soft/hard-fork discussions, may face similar challenges ahead. Yet, already in 2014 Arthur Breitman quietly started working on cryptocurrency network Tezos that has an explicit mechanism to let coinholders vote on protocol upgrades.

Our discussion with Breitman centered around how explicit governance could lead to a more secure and evolutionary protocol. We also discussed Tezos’ approach to smart contract that tries to prevent bug-riddled and insecure smart contracts such as the DAO which has thrown Ethereum into a deep crisis.

Topics covered included:

  • Why stakeholders voting on forks can prevent consensus attacks
  • The mechanics of Tezos’ governance
  • How an upgrade mechanism could allow Tezos to rapidly and radically evolve
  • Why the programming language in which smart contracts are written is crucial for security
  • Why a functional language that allows formal proofs such as OCaml is more suited for smart contracts than Ethereum’s solidity
  • The road ahead for Tezos

Links mentioned in this episode:


Proof of Owning shares a la Nu?

Tezos claim they can verify smartcontract (because Ether actually does not) –
Their solution: a high level programming language. <-- that wont change the essence of the issue

Well, again: Satoshi has showed us the way you verify operations in a decentralized way –
You hash you your action or instruction, put it in a block, time stamp it and connect with the rest of the chain AND wait for the majority of atomic observers to redundantly observe likewise.

Tezos position paper

While emphasis has been put on the Turing complete aspect of the language,
the second property is by far the most interesting and powerful of the two. In
Bitcoin, an output can be thought of as having only two states: spent and
unspent. In Ethereum, accounts (protected by a key) hold a balance, a contract
code and a data store. The state of an account’s storage can be mutated by
making a transaction towards this account. The transaction speci es an amount
and the parameters passed to the contract code.
A downside of a Turing complete scripting language for the contracts is that
the number of steps needed to execute a script is potentially unbounded, a
property which is generally uncomputable.
To address this problem, Ethereum has devised a system by which the miner
validating the transaction requires a fee proportional to the complexity and
number of steps needed to execute the contract.
Yet, for the blockchain to be secure,
the active nodes need to validate
the transaction. A malicious miner could include in his block a transaction that
he crafted specially to run into an in nite loop and pay himself an exorbitant
fee for validating this transaction. Other miners could waste a very long time
validating this transaction. Worse, they could just slack and fail to validate it.
In practice though, most of the interesting smart contracts can be implemented
with very simple business logic and do not need to perform complex calculations.
Our solution is to cap the maximum number of steps that a program is
allowed to run for in a single transaction. Since blocks have a size limit that
caps the number of transactions per block, there is also a cap on the number
of computation steps per block. This rate limitation foils CPU-usage denial-of-
service attacks. Meanwhile, legitimate users can issue multiple transactions to
compute more steps than allowed in a single transaction, though at a limited
rate. Miners may decide to exclude too long of an execution if they feel the
included fee is too small. Since the Tezos protocol is amendable, the cap can be
increased in future revisions and new cryptographic primitives included in the
scripting language as the need develops.