Members of the crypto community are likely to come up with mantras like “Don’t trust, verify!” Be familiar. or the “law of code”. Both relate to the promise of more transparency and audibility, as well as a technology that offers to replace fallible, corruptible powerful actors with one actually working rule-based order, secured by deterministic calculation.
The desire to forego the need to trust third-party actors is a mainstay for many cryptocurrency creators and users. Bitcoin (BTC) was finally invented in the immediate aftermath of the 2008 financial crisis, and the abuse of authority by powerful actors and institutions continued to be felt throughout the Great Recession. Crypto has attracted more and more enthusiasts against the backdrop of the social, political, and economic crisis.
However, an article, first published in August by a group of researchers and posted on the Oxford University Law School blog on October 27, argues against conceiving blockchain as a matter of trust – or its absence.
Instead, the paper suggests understanding blockchain as a “trust machine”: a technology designed to maximize the level of trust in the system as a means only indirectlyReduce the need for interpersonal trust. The paper’s argument rests on a careful analysis of the distinction between trust and confidence, each of which, taken in isolation, is a complex collection of ideas. For all internal complexity, however, trust and confidence imply a fundamentally different interpretation of the nature of the social environment.
Trust in its various definitions presupposes the recognition of risk and uncertainty: One can choose to consciously trust another agent through a “leap of confidence” or an “obligation” or as a result of a rational decision based on a calculation that it is in It is in the interest of a third party to act in a certain way. You can also trust more tacitly through routine actions that are less explicit about the background to the risk.
Trust, on the other hand, presupposes the predictability of systems or institutions. These predictable systems, in the case of the blockchain, relate to the technological design of a protocol (i.e. a protocol intended to mint a certain grade of new coins at a certain interval), a repository for open source code and the mathematical properties of hash Public-private key functions and cryptography.
Blockchain systems also seek to maximize the predictability of a network of actor decisions through game theory mechanisms and economic incentives, as well as by providing a collectively verifiable record of the sequence of actions in a given ecosystem.
However, in the course of their argument, the authors of the paper complicate this view of trust, which they believe is based on the rejection that blockchain systems are irreducibly hybrid and include both social and technical components. They make their case stand by examining the actual asymmetries in terms of resources and knowledge – and therefore power – between the various actors in blockchain networks, uncovering the mix of trust, trust, and even belief that is contained in their day-to-day operations .
“The governance of most blockchain-based systems is highly centralized: on-chain governance is inherently plutocratic and is dominated by a few large operators or individuals who control most of the mining resources and / or token stocks, while the off -Chain governance most often works as a technocracy with a few influential players dominating both the front and backstage stages. “
Rather than evoking an alternative, ideal scenario in which relationships of dependency and domination could magically be removed, the paper concludes with an examination of what, properly understood, blockchain governance actually entails; and what could result from it if we fully recognize the power clusters that inevitably shape its infrastructure.