this post was submitted on 18 Aug 2023
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I thought the royalty payments were enforced by the contract?
Turns out that the smart contract is a post-it note stapled to the NFT and the marketplace can just ignore what the post-it note says because it's not legally binding.
What they can't do is trade with marketplaces that do enforce the contract. Originally it was enforced because if one marketplace stopped enforcing it the marketplace would be cut off from the Echo system but turns out that the 5 big marketplaces just need to agree to drop it and everything is fine.
There is no good design for this. The only design that works is external regulation and laws wich is why we use that for real things that aren't scams.
Nah the actual limitation is that providing people a way to transfer the token without paying a royalty is essential if you want to give people the option to freely transfer it between their wallets without selling it and paying a royalty. You could write a smart contract that does enforce this but then you would lose the ability to have that free transfer.
You can easily end up with A gifting B a million and then B sending A the NFT for free, potentially with a trusted escrow service in between to make sure both of these actually happen. The NFT marketplaces are essentially already acting as escrow, so this isn't weird.
Only thing you could probably enforce is that moving something from one key to another requires a fee to be paid to the original artist, but that'd also trigger if A wants to move their assets to a different key (eg in or out of some hardware wallet, online wallet or marketplace). And if A and B trust each other strongly they can simply share the key.
Or they set up a multisig wallet, each creating one keypair directly on approved (tamper resistant) hardware wallet models, transfer it to the multisig wallet, and now control of the collection of multisig wallets means you control the token.
So now you trade it by trading the set of hardware wallets. Validated by each original participant including results from an audit of the key generation procedure with the hardware wallet.
No trace on the blockchain, and the trust model is more robust than simply taking the word for it as one of them share the private key claiming they did not keep their own copy.
The protocol doesn't support covenants like that in smart contracts. It has been discussed a lot but not implemented.
It gets complicated fast.
Because the second the rule becomes inconvenient there will be a fork or some kind of bullshit that removes the rule. This has already been done a couple of times when money got stolen from big investors. The thefts followed the rules set up on the blockchain and nothing in those transactions were different from a normal transaction but humans looked at them and said that they weren't valid and did whatever technical bullshit they needed to do to reverse them.
Apparently ultimately this involves hitting the person hiding the encryption keys with a $4 wrench until they provide the keys.
I know that reference.
I hope you are aware that you went from "this can't be broken" to "I trust that people wouldn't break it" to "sometimes they do break it but it's not that often" in a very short comment.
So if 50%+1 of people decide that they don't want to pay artists they can just stop doing that. Sounds iron clad to me.
No, that's the way the blockchain works. It's one way to do decentralisation, a very bad way based on property and absent of trust.
A much better way to do decentralisation is what you are currently participating in. Federation is based on trust and building communities, not cold maths dictating who owns a bunch of imaginary bullshit.
That's what I am fucking saying! You cant design around greedy fucks. Also this whole discussion I participated in the delusion that those 50% were individual people. We both know that they are not because there is nothing to identify individuals so the system is entirely decided by wealth so it isn't even decentralized. It's all just a scam that regularly collapses by design because that is how the rich people extract real money from it.
Royalties were not part of the original design.
No see it's a lot more sophisticated than that. The post-it note is immutable because of maths or something, so what that means is that it's capital-P Property. And because Property is a magic spell that binds even the old ones, and this spell is unbreakable, I own all these apes.
Okay, I assume this comment is in defense of crypto contracts or whatever? This is solving a problem that doesn't exist.
I was exposed to many, many litigation cases in my time working in the legal system. The worst ones happen because contracts aren't made or are sloppily constructed. I have never, ever, in many years of seeing civil cases go through the office, seen a single example where the problem was that someone had falsified a contract or there was disagreement about what a contract actually says. Contracts change all the time, so making them immutable makes them less useful to both parties.
Also big companies break contracts all the time, and they don't get away with it by lying about the contents of the contract, they get away with it because they have all the money and all the power.
The same thing with money. Counterfeiting is a tiny problem with almost any currency. The real problem is theft, and the lawless, immutable nature of the blockchain renders theft absolute, with no recourse.
This is the problem with the blockchain in general - immutability solves a nonexistent problem and creates a much worse problem. The no-trust basis of the system attracts grifters because there is no way to take back a bad transaction. The only reason people believe it works is because they somehow believe that documenting transactions immutably will make them bind people, just like some sort of magic spell. That's just not how the world works.
You've said a lot of words but you still haven't explained how crypto actually solves these problems.
Once again: laws, including contract law and currency, aren't magic spells. They don't have power just because they exist. They require the power of a state to enforce them. Crypto is the same. Just because you're tracking transactions on a public immutable ledger doesn't change anything about that.
Now, as an anarchist, I'm not saying that to defend the current system. I am saying the solution is to remove the actual power of the state. Crypto is only attempting to replace tokens of state power, with no attempt to address the power itself.
And yes, I understand how you could in theory make changes to a contract with further ammendments, the thing is that costs transactions. There is no such thing as a modification based purely on consent of the parties. That is a serious problem for their usefulness, which was my actual point.
Right but again, that problem is not one that existed. The future is federation - communities working together based on trust, not finding novel ways to track who has & does not have resources.
It wastes a medium country's worth of emissions every day just to count coins or write things down, and it doesn't get used to liberate people it gets used for scams.
With ethereum, they've been promising this for a while. I believe they are talking about "proof of stake". The problem with this is of course that you need stake to begin with. This is effectively just capitalism. They explicitly say this in their language:
https://ethereum.org/en/developers/docs/consensus-mechanisms/pos/
So that just reproduces the problem where you need money to be part of the ecosystem, and an ultra-wealthy bad-actor could easily undermine the system.
Now, as for the idea that any tool can be used for good or ill, I would say that's true of technology, but not tools. The actual implementation of any given technology affects how it will be used. This is what the saying, "When all you have is a hammer, everything looks like a nail," is talking about. In media the saying is, "The medium is the message."
Similarly, you can't use nuclear weapons for anything good, at least not currently. There was a whole project called "operation plowshare" that tried to find good uses for these things. They just ended up creating a bunch of irradiated craters.
So cryptography is the technology, blockchain is the tool. My point is that if you understand what that tool does, and you look at how it gets used historically, it's pretty obvious that it's used for scams. Yes, there are promises that it could be used for better things in the future, but until it actually does so, there's no reason to believe it.
A good podcast about this is the Behind the Bastards episodes on crypto:
https://www.iheart.com/podcast/105-behind-the-bastards-29236323/episode/part-one-lets-talk-about-cryptocurrency-90181213/
https://www.iheart.com/podcast/105-behind-the-bastards-29236323/episode/part-two-lets-talk-about-cryptocurrency-90276347/
As for the transitional period where state power is being eroded and communities are being built, it might be true that you can't trust someone halfway around the world, individually. This is where I'm basically just brainstorming how I personally would suggest this problem be solved:
I would still rely on federation. For instance, as things stand right now, countries have trade agreements between one another, and those agreements don't work because of some outside police force, they work because those entities rely on one another. There is a level of trust, even though states are notoriously untrustworthy, they still know the level of trust is stable enough to make their currencies compatible and engage in trade.
If you're in a federated community that trades with other communities on a basis of mutual aid and trust, you could easily have a trade agreement from your federated communities with capitalist states. Then whatever mechanism you would use to negotiate requests internally, you just create a similar mechanism where you request an item that is for sale from a capitalist country, and the federation organises the sale externally. That insulates you from needing to trust anyone externally.
This would be what you would do if you absolutely had to, but I can also see why such communities would want to minimise their support for capitalist states. Ultimately the only reason such a state would have an agreement with a federated bloc of anarchist communities would be because they benefited somehow. I would say in such a world the downfall of such states is inevitable, but maybe it's the most peaceful way to manage such a transition. Ideally, you wouldn't trade in single transactions with people on the other side of the world. Most goods can be produced internally in any reasonably sized economy, and if you don't have cheap vs expensive labour, there's no reason most goods need to be imported. Currently we import clothing, for example, across oceans for absolutely no reason other than to exploit cheap labour. That's enormously wasteful in so many ways. I personally would far rather have a slower pace of consumption, and make industry more localised, than use crypto just for individual overseas purchases.
Oh and I'm happy to talk to anyone who is responsive to the points I'm making. If you weren't I wouldn't have spent this long talking to you :)
Maybe the tools/technology dichotomy isn't so clear, but I guess I'm talking about how technology is applied and how tools are designed. Like the difference between a wood axe and a polearm - both are built on the same fundamental principles of adding a sharpened metal object to the end of a wooden stick, but one of them is good for chopping wood and the other is good in battle. You could swap them around, but they'd be almost useless at one another's jobs. How they are designed dictates how they are used, and currency technologies are no different. They are a type of accounting, but they are built around lack of community. Debt the First 5000 Years by David Graeber is a great book on this topic, explaining the social origins of debt and how money really isn't such a big part of most of human history, only rising to its current form with the advent of imperialism and colonialism.
I guess my point with the blockchain thing is that even though I can see some use for keeping records in a decentralised way, I still don't see blockchain solving any real problems there. Again, if you need decentralisation you should base it on trust, and basically anything you do in that sphere you can do with simple authentication, which is a type of cryptography we've had for many decades now. If the outside world is using blockchain you could make a case for using it in a limited way when you absolutely have to, but I certainly wouldn't advocate for supporting blockchain.
Advocating for it on the basis of hypothetical future uses for it is basically falling afoul of the AM/FM distinction, AKA Actual Machines vs Fucking Magic. Actual machines exist and you can see their track record; fucking magic is whatever the scam artist sells it as. If the technology hasn't proven itself yet, then you can't make plans based on it.
My point about international relations was that "trust" works even in that cutthroat context. I love Beau btw, he's absolutely right about that point. Weirdly I think the first place I understood that concept was from reading Ice Station by Matthew Reilly, which is just the most trashy action novel you could imagine.
I agree that anarchism is slowly emerging everywhere, and that's kind of how it has to be. I imagine it as a smattered, regional emergence in disparate places, which once it passes a crucial tipping point it floods everywhere all at once. Like I think people would be shocked at how fast society can change once the systems of oppression crumble.
The question of nuclear war is a sobering one. It is in theory possible that one continent goes before another, and in that case perhaps a nuclear power might decide to attack with nuclear weapons. The only thing you could do in that case is say, "Well, our territory now contains nuclear weapons too, so MAD is still in effect." It's not a great answer, but it's the only one I can think of.
Yeah, thanks for the talk, gave me some things to think about too :)
You’re thinking too rationally now. The thing with NFTs is that it’s not rational at all. Try again.
Basically the transfer function on an erc721 interface (nft) cannot have enforced royalty payment otherwise it wouldn't support people transferring the token outside of a sale. Theoretically you could use some kind of interface standard or write up a different contract where users are forced to pay a royalty on any kind of transfer but then there wouldn't be a way to transfer it without paying the royalty and basically no nft trading platforms would support it because under the hood you have to transfer them the token so they can sell it on your behalf once a buyer is found.
FYI not trying to shill funny pictures but I do know a bit of solidity so maybe someone here is actually curious about the limitation.
Thank you. This is what I wanted to know!