The concept of smart contracts has grown considerably since the birth of Ethereum. We've seen an explosion of interdisciplinary research and experimentation bundling legal, social, economic, cryptographic and even philosophical concerns into a rather strange milieu of tokenized intellect. Yet despite this digital cambrian explosion of thought, there seems to be a lack of a unified ontology for smart contracts. What exactly is an ontology? Eschewing the philosophical sense of the word, an ontology is simply a framework for connecting concepts or groups alongside their properties to the relationships between them. It's a fundamental word that generally is the attempt at bedrock for a topic. For example, it's meaningful to discuss the ontology of democracy or the ontology of mathematics.
Why would one want to develop an ontology for smart contracts? What is gained from this exercise? Is it mostly an academic exercise or is there a prescriptive value to it? I suppose there are more questions to glean, but let's take a stab at the why.
Smart contracts are essentially two concepts mashed together. One is the notion of software. Cold, austere code that does as it is written and executes for the world to see. The other is the idea of an agreement between parties. Both have semantical demands that humans have traditionally had issues with and both have connections to worlds beyond the scope in which the contract lives.
Much of the focus of our current platforms, such as Ethereum, is on performance or security, yet abstracting to a more ontological viewpoint, one ought to ask about semantics and scope.
From a semantical perspective, we are trying to establish what the authors and users of smart contracts believe to be the purpose of the contract. Here we have consent, potential for non est factum style circumstances, a hierarchy of enforceability and other factors that have challenged contract law. What about cultural and linguistic barriers? Ambiguity is also king in this land.
Where normal contracts tend to pragmatically bind to a particular jurisdiction and set of interpretations with the escape hatch of arbitration or courts to parse purposeful ambiguity, decentralized machines have no such luxury. For better or worse, there is a pipeline with smart contracts that amplifies the semantical gap and then encapsulates the extracted consensus into code that again suffers from its own gap (Loi Luu demonstrated this recently using Oyente).
Then these structures presume dominion over something of value. Whether this dominion be data, tokens or markers that represent real life commitments or things such as deeds or titles. For the last category, like software giving recommendations to act on something in physical world, the program can tell one what to do, but someone has to do it.
So we have an object that combines software and agreements that has a deep semantic and scope concern, but one could add more dimensions. There is the question of establishing facts and events. The relationship with time. The levels of interpretation for any given agreement. Should everything be strictly speaking parsed by machines? Is there room for human judgement in this model (see Nick Szabo, Wet and dry code and this presentation)?
One could make a fair argument that one of the core pieces of complexity behind protocols like Ethereum is that it actually isn't just flirting with self-enforcing smart contracts. There are inherited notions from the Bitcoin ecosystem such as maximizing decentralization, maintaining a certain level of privacy, the use of a blockchain to order facts and events. Let's not even explore the native unit of account.
These concepts and utilities are fascinating, but contaminate attempts at a reasonable ontology that could be constructive. A less opinionated effort has come from the fintech world with both Christopher Clack's work on Smart Contract Templates and Willi Brammertz’s work on Project ACTUS. Here we don't need immutability or blockchains. The execution environment doesn't matter as much. It's more about consensus on intent and evaluation to optimize processes.
What about the relationship of smart contracts with other smart contracts? In the cryptocurrency space, we tend to be blockchain focused, yet this concept actually obfuscates that there are three data domains in a system that uses smart contracts.
The blockchain accounts for facts, events and value. There is a graph of smart contracts in relation to each other. Then there is a social graph of nodes or things that can interact with smart contracts. These are all incredibly different actors. Adding relays into the mix, one could even discuss the internet of smart contract systems.
Perhaps where an ontology could be most useful is on this last point. There seems to be economic value in marrying code to law for at least the purpose of standardization and efficiency, yet the hundreds of implicit assumptions and conditions upon which these systems are built need to be modelled explicitly for interoperability.
For example, if one takes a smart contract hosted on Rootstock and then via a relay communicates with a contract hosted on Ethereum and then connects to a data feed from a service such as Bloomberg offers, then what's the trust model? What assumptions has one made about the enforceability of this agreement, the actors who can influence it and the risk to the value contained? Like using dozens of software libraries with different licenses, one is creating a digital mess.
To wrap up some of my brief thoughts, I think we need to do the following. First, decouple smart contracts conceptually from blockchains and their associated principles. Second, come to grips with the semantic gap and also scope of enforcement. Third, model the relationships of smart contracts with each other, the actors who use them and related systems. Fourth, extract some patterns, standards and common use practices from already deployed contracts to see what we can infer. Finally, come up with better ways of making assumptions explicit.
The benefits of this approach seem to be making preparations for sorting out how one will design systems that host smart contracts and how such systems will relate to each other. There seems to be a profound lack of metadata for smart contracts floating around. Perhaps an ontology could provide a coherent way of labeling things?
Thanks for reading,
Professor Aggelos Kiayias joins IOHK as Chief Scientist
Prof Kiayias is the pre-eminent academic in the field of blockchain security. He has produced pioneering work providing the rigorous analysis necessary to secure confidence in this emerging technology.
Blockchain technology has the potential to significantly reshape the future of finance, and Prof Kiayias is the leading researcher promoting and studying the science behind blockchain systems. In one project, Prof Kiayias led a team in Athens last year that designed the first e-voting system, where voters could verify that votes cast actually went to the intended candidate, without relying on a trusted system component.
Prof Kiayias produced a key paper proving fundamental properties of bitcoin blockchain and played a lead role in writing IOHK’s paper on the first provably secure Proof-of-Stake protocol, published in the IACR Cryptology ePrint Archive and available in the IOHK research library.
Prof Kiayias said that IOHK’s rigorous standards made it stand out among cryptocurrency companies.
“I am very happy to engage with a team of very enthusiastic researchers in the area of blockchain systems,” he said.
“While other companies may consider taking shortcuts or focus on just engineering their products, IOHK makes long-term commitments in building basic tools that are available to the community as a whole and in advancing the science behind blockchain systems.”
Charles Hoskinson, chief executive and co-founder of IOHK, said: “Professor Kiayas is one of the most rigorous and creative cryptographers working in the cryptocurrency space, with a long pedigree of accomplishments from the GKL15 model to the first provably secure Proof-of-Stake algorithm.
“It’s a tremendous honor to have Aggelos on board as our Chief Scientist to help IOHK navigate the complex, yet always sublime world of cryptography. We look forward to the results this collaboration will bring as well as the great papers that will undoubtedly follow.”
Prof Aggelos Kiayias is the Chair in Cyber Security and Privacy at the University of Edinburgh. His research interests are in computer security, information security, applied cryptography and foundations of cryptography with a particular emphasis in blockchain technologies and distributed systems, e-voting and secure multiparty protocols as well as privacy and identity management. He joins IOHK as chief scientist through a long-term consulting agreement between IOHK and the University of Edinburgh, UK, where he is based and continues to do research and teach courses in cyber security and cryptography. Prof Kiayias is also Professor in Residence (gratis) at the University of Connecticut, USA, and Associate Professor of Cryptography and Security (on leave) at the National and Kapodistrian University of Athens, Greece.
Prof Kiayias’s cyber security research over the years has been funded by the Horizon 2020 programme (EU), the European Research Council (EU), the General Secretariat for Research and Technology (Greece), the National Science Foundation (USA), the Department of Homeland Security (USA), and the National Institute of Standards and Technology (USA). He has received an ERC Starting Grant, a Marie Curie fellowship, an NSF Career Award, and a Fulbright Fellowship. He holds a Ph.D. from the City University of New York and he is a graduate of the Department of Mathematics at the University of Athens. He has more than 100 publications in journals and conference proceedings in the area.
He currently serves as the program chair of the Financial Cryptography and Data Security 2017 conference.
Fallen Memories Each generation has defining events. I remember the morning of 9/11 as a young teenager seeing the iconic footage of smoking towers with the eventual collapses. Much later in life, I had a chance to parse quite a comprehensive set of data points from that day.
Bush's memoir Decision Points contained a fairly indepth blow by blow account that captured the paranoia and helplessness. Many others have published some account of their experiences. Ted Olson- the solicitor general at the time famous for arguing for Bush in Bush v Gore- lost his wife on flight 77. She fatally delayed her travel by a day to wake up next to Ted on his birthday. Seth MacFarlane- the creator of family guy- missed flight 11 by just ten minutes due to a hangover.
There doesn't seem to be an end to the stories of how pervasive 9/11 has been on our collective psychology. There also doesn't seem to be an end to the retrospective analysis of the causes and motives.
The cryptocurrency and liberty movements in particular are extraordinarily skeptical of official government positions (often justifiably so- just look at operation northwoods). The formative lesson I learned from 9/11 is that the United States Government seems perfectly capable of purposely ignoring reality.
There's a wonderful book by the co-chairs of the 9/11 commission Kean and Hamilton entitled without precedent that addresses the frustrations of the commission's members ranging from chronic underfunding, an artificial deadline and Kafkaesque requirements for testimony from top level officials such as Bush and Cheney:
- They would be allowed to testify jointly
- They would not be required to take an oath before testifying
- The testimony would not be recorded electronically or transcribed, and that the only record would be notes taken by one of the commission staffers
- These notes would not be made public
We've now committed ourselves to a 15 year war on terrorism without a clear end in sight. We've now committed ourselves to an intelligence goliath (best described in Bruce Schneier's recent book data and goliath) that is systematically robbing us of our constitutional rights. Perhaps darkest, we've also committed ourselves to giving the US government the legal right to kill its own citizens without due process (Jake Tapper's scathing questioning of Jay Carney is probably the most elegant).
The harsh reality that every American faces is that we were let down by our government and that 9/11 seems to be a symptom of an inconvenient truth to the consequences of empire. A proper investigation would have forced a brutal journey through US foreign policy, the conduct of friend/enemies such as Saudi Arabia (see Bob Grahm's crusade), the dense shadowy web of interconnections amongst politicans and private industry and how the intelligence complex works. Succinctly, it just wasn't going to happen.
I can greatly empathize with those seeking more answers and also harboring deep resentment. It's clear there are abundant lies that we have paid for in much blood and treasure. Some of the most frustrated are veterans who committed to fighting in the ensuing wars after 9/11 to seek retribution against the designated enemies only to find a more nuanced situation alongside TBIs, lost limbs and a general apathy upon returning home.
We didn't even get to see the body (much less an indepedently verified DNA sample) of the architect of the entire attack after spending trillions of dollars finding and killing him. I guess that's too offensive except for the times it's not.
To wear my Viktor Frankl hat, I suppose we can honor the losses and derive meaning from that dark day carrying its terrible 15 year fallout on the world by making a commitment to changing our government. We need to decouple money and politics. We need better channels to communicate ideas because the media is failing us. We need to decentralize the US government with much more power returning to the states. We need to change the way we hold elections and bundle our voting system to something like a blockchain for fidelity. We need to change how the United States commits its military to adventures abroad. Finally, we need to end the two party system.
The American Way
These are enormously challenging tasks and some would say beyond our abilities in the current political system. Yet, the global reinvention of money and ending the Soviet Empire were just as difficult if not more so. What gives me hope is that the American people are pretty special. We seem to have a knack for doing the impossible and then acting as if there was a certainty of success.
For example, our space program was trapped in a hyper-bureaucratic loop of half started missions and low hanging fruit. Now we have SpaceX, Blue Origin and others effectively building a roadmap to Mars and beyond. Tesla has proven battery powered cars are an inevitability. Some of our scientists have even built a star from lasers.
It just takes a bit of courage and also a willingness to experience failure in the process. It also takes an utter rejection of cynicism. Another reality- to paraphrase the late Steve Jobs- all the rules around us are made by people no smarter than you. To treat them as immutable gods is to discount one's own abilities.
On this anniversary of 9/11, I'd like to thank those who fought and those who continue to fight for freedom and truth. And, I'd also like to believe we will evolve as a world beyond the root causes of these events. We just have to be honest, disciplined and resilient.
Ethereum Classic: An Update
9 September 2016 Charles Hoskinson 8 mins read
I wanted to draft a brief update on IOHK's efforts on Ethereum Classic (ETC). We've had the opportunity to schedule more than three dozen meetings with developers, community managers and academic institutions. We've also managed to have several long discussions with several of the community groups supporting ETC to get a better sense of commitments, goals and philosophy. Overall, it's been a really fun experience getting to know a completely decentralized philosophical movement. It's also been illuminating to parse the challenges ahead for the fragile movement as it charts its own path forward. I'll break the report down into what we learned and what we are going to do.
What We Learned
Carlo Vicari and I have been trying to map out the total ETC community and also get some metadata about who they are (vocation, age, geography, interests...) so we can better understand the core constituencies. We will publish some preliminary stats sometime next week, but as a rough summary there are currently several meetup groups, a telegram group, a reddit, several Chinese specific hubs, a slack with over 1,000 members and a few other lingering groups.
Daily activity is growing and there is interest in more formal structure. With respect to developers, there are about a dozen people with development skills and knowledge of the EVM and solidity in the developer channel. They have been holding pretty deep discussions about potential directions and roadmaps. The biggest topics are currently pivoting consensus to PoW without the difficult bomb, new monetary policy and also safer smart contracts.
There is also interest in forming a pool of capital to pay for development efforts ranging from core infrastructure to DApps on top of the system. I haven't taken a position on this effort because we still need to address some governance and legal questions. Regardless of whether this pool materializes, IOHK's commitment of three full time developers will be funded solely by IOHK.
It seems that the price and trading volume of ETC has held relatively stable despite the virtual sword of damocles that is the DAO hacker and RHG funds. It seems that there is enough community interest in ETC to keep liquidity. I do think there will be tremendous volatility ahead and it's going to be impossible to predict when black swans are going to land in our laps, but I suppose that's what makes it fun?
After the initial conversations and analysis, we have determined the following serious deficits with ETC:
- There isn't an official or reliable channel of information about the events of the ecosystem or commitments of various actors. This reality has lead to FUD, impersonations and attempts at market manipulation in the absence of clarity.
- The roadmap of ETC needs to include at a minimum an emphasis on safety, sustainability and stability. There is a strong desire amongst the ETC community members we had discussions with to focus on reliable, high assurance applications that run on a network with proven fundamentals. Effectively, this needs to be the antithesis of move fast and break things.
- There is a desire amongst several well capitalized actors to donate capital to a pool to fund the growth of ETC. This desire has been complicated by the lack of a clear governance structure that will avoid fraud or misuse of funds. Furthermore an open pool would allow funds to potentially become tainted by RHG or Dao hacker donating funds to it. While code is law covers the protocol level use of funds, it does not shield actors from the legal realities of their actions. It is unclear how these funds should be treated or if accepting them would constitute a crime.
- The media is uncertain how to report on ETC outside of a referential curiosity to ethereum itself . There needs to be a re-branding and media strategy to ensure new users enter the ecosystem with a clear understanding of what ETC is about and how it differs from ETH.
- Concepts like the replay attack and also new potential technology that could be adopted are not fully understood by ETC community members or general developers. There needs to be actors dedicated to education and explanation.
- The Ethereum Foundation owns the Ethereum trademark. Further use of this branding could provoke a trademark infringement lawsuit to companies using the Ethereum brand and name. This complicates the formation of a centralized governance entity or steering committee if it chooses to use ethereum classic as its name. It also complicates business commitments to building on the ETC chain.
Thus IOHK is in the process of doing the following:
- We have interviewed several community manager candidates and will make our final selection sometime next week. He or she will be responsible for assisting meetup group founders, managing social media channels, broadcasting accurate information, combating FUD, collecting feedback from the ETC community and dealing with media entities. My hope is this position will be defined by its interactions with the ETC community and give us a starting point for timely and credible information at the very least.
- IOHK is going to subsidize an educator to produce content on ETC ranging from the replay attack to new proposals suggested in various roadmaps. We have one candidate in mind and are finalizing the contract and duration of the relationship. All content will be released under a creative commons license and our hope is to again let this role be community driven.
- IOHK has had numerous discussions with academic partners about the consensus algorithm of ETC and also the smart contract model. We would like to see if the EVM can be improved to be more secure and that Typescript and Purescript could be used as ETC's smart contract languages representing both a functional and imperative approach to development that maps nicely onto the skillsets of existing developers. We are seeing what types of partnerships are possible in the next few months and will provide an update.
- We've also spent quite a bit of time looking at Smart contract languages on the horizon. There are some excellent ideas coming from Synereo and Juno's Hopper. IOHK has entered into a partnership with Kent University to begin an analysis of Transaction Languages used in cryptocurrencies. We will have a survey report available sometime in Q4 of 2016. This report will form the basis of our organization's understanding of the interplay of smart contracts in cryptocurrencies. Once available we will release it to the general public as a whitepaper.
- We have decided that Scorex 2 will make a good base to build our ETC Main Client (Read Alex's First Blog on It). The core is going through a massive refactoring that will be finished sometime this month. From this point, we will retain a scala specific team (our three developer commitment) to fork Scorex 2 and build a full ETC Node including a wallet with GUI. The architecture of Scorex should allow for much faster iterative improvements and also a great opportunity to test our new blockchain specific database IODB .
- With respect to the developer hires in particular, we have taken quite a few resumes already, but also want to make the process open to the general public. Our new community manager will post the job ad on the ETC reddit once he's been hired. I expect the first developer to be announced sometime in September. Quality scala developers with the requisite skills to make meaningful contributions to Ethereum are rare and require careful vetting.
- With respect to a technological steering committee to guide the roadmap process, we are proposing the formation of a federated group tentatively called the smart contract engineering taskforce (after the IETF). Ideally we could develop an RFC process to propose improvement proposals from the community without the need for a formal, centralized entity. We'd love to see this form as a DAO. There could be two tracks covering changes requiring forks and changes that are iterative in nature. We will start the discussion about this group sometime in early October.
- IOHK cannot resolve the trademark issue, but will make a commitment to not use the Ethereum brand or name in its repos or company assets. This said, we would like to see some form of bilateral resolution to this situation. It seems pyrrhic to seek trademark enforcement on a decentralized movement. We also understand the confusion this issue is causing the general public and developers.
Ode to the Contrarian Artifacts
27 August 2016 Charles Hoskinson 6 mins read
A Fistful of Pauls
It was the night of January 3rd, 2008 in Des Moines Iowa. The temperature was a brutally cold ten degrees, yet over a hundred thousand caucus goers endured long lines, confusing rules and poorly organized events to express their political will in the republican primaries. Just days earlier, many internal and some local polls showed Ron Paul performing admirably in a dead heat with Mike Huckabee.
It seemed as if the revolution's recent fundraising wins would translate into votes. It seemed as if the entire republican establishment was going to endure a defeat harsher than the wars they inflicted on the American people over the last eight years. Yet when the results came in, each percent point was like a dagger in the heart of the movement. The end tally was roughly ten percent support for a total around 11,000 people. Some rallies attracted nearly that many people. Somehow Huckabee attracted 4 votes for each of Paul's.
It seemed as if the harsh defeat was now reserved for the Paul movement. Some campaigners, exhausted from running the full grassley twice in just a few of months cried. Other responded with rage. Some argued that the vote had been rigged- afterall, the University commitments alone were 15,000 votes. One campaigner sat silently on an outside bench without a coat carrying a grave thousand yard stare for several hours. It was an easy time to feel hopeless. The remainder of the primaries didn't help.
In the aftermath, many wrote the Ron Paul campaign off as a populist anomaly. An internet era federation of John Birchers marrying the Austrians to return the American people to the 19th century's deflationary horrors and isolationism. How dare a campaign inflict the banality of historical reflection upon the American people! How dare he ask his fellow candidates to read books and think about the nature of money!
The appraisal couldn't be further from the truth. The contrarian arguments grew and now have created an entire generation of advocates who desire to end the fed, return to the gold standard, end foreign entanglements and embrace constitutional rights. In a more abstract sense, the contrarian always seems to be maligned, mocked and diminished; however, occasionally plants seeds that will eventually overcome whatever social paradigm they are fighting against.
Another figure that comes to mind is Cantor. He is now regarded as one of the greatest mathematicians of the last few centuries including the company of Riemann, Euler and Gauss. Analogous to Paul's heresy of addressing the inconvenient and sensitive topic of monetary policy, Cantor dared to ask deep questions about the nature of infinity. He presented a diagonalization argument that demonstrated that while both the natural and real numbers are endless, they are somehow a different type of endlessness.
This work simultaneously led to extraordinary questions like the continuum hypothesis and to Cantor's dreadful consternation at his peer's sharp dismissals ranging from "grave disease" to "scientific charlatan". While he has been posthumously vindicated, the treatment by his peers and Cantor's subsequent nervous breakdown demonstrates the social consequences of dissent. As a final irony, there are now some mathematicians such as Norman Wildberger who are actually in the opposite position.
Value of Dissent
The value of contrarians isn't in their efforts to win over the crowd with their counterarguments to the norm- many are in fact completely wrong. Their value is more significant than a policy change or a scientific retooling. The power of contrarian thinking is that it forces a more fundamental appraisal of the axioms and heuristics we tend to use to navigate life.
For example, in the heroic age of medicine, blood letting and cocaine laced mercury were the common notions. Allopathy challenged the entire basis for having these thoughts. The methodology itself was flawed and needed a change.
On the same token, Ron Paul's movement was an electoral failure, but a massive success in the thoughts about money. Value is starting to be viewed more socially and globally than siloed, institutionally enforced magical units of account.
Some of Bitcoin's earliest and more ardent adopters were Paulites who already crossed the mental gap of seeing fiat for what it is- a social artifact. Now Bitcoin is a change engine forcing this humbling truth just by its continued growth and existence.
Lex Ex Machina
Smart contracts seem to me to be another contrarian mental artifact. They are eating at the roots of the common notions of law. Who should enforce laws? What are contracts? What is intent? How should arbitration be addressed?
We have socially constructed answers to these questions forming a corpus of knowledges hundreds of years old. No human could ever appreciate the totality of opinion and elegance of such a construction much less a mathematician ever read and understand the entire proof of the classification of the finite simple groups.
Yet this system is becoming increasingly more expensive to maintain, riddled with inequities and requires legions of domain experts to just interpret its arcane wisdom. Is it moral to propagate a system that hurts the poor, drains society of resources and favors a rich minority to manipulate at a whim?
Whether the effects of smart contracts have a real impact on commercial transactions and push us towards a private legal system for trade is as relevant as Ron Paul's loss. It's the attack on the fundamentals of the existing paradigm given alternatives that is much more meaningful. Contracts can become understandable open source, composable, templatable and in many cases don't require the heavy hand of government to resolve.
There is already a growing movement from Stanford's CodeX group to IBM's Ross providing AI driven legal assistance. As a corollary, I would be authorially negligent if I didn't mention Nick Szabo's recent writings on Wet and Dry code.
Could we now be approaching a future where the government has a moral obligation to give us our own robot lawyer to interpret their Borgesian library of laws? Could we see people switching between legal systems as easily as multinational companies? Will we begin to expect an evolutionary nature in our legal system akin to the accelerating pace of technology? With the right contrarian artifacts perhaps.
An Artifact in Every Thought
The concise summary of my thoughts is that we live in a house of ideas, common notions, social conventions and biases inherited from people no smarter or better equipped than us. We cannot accept at face value their gifts and curses. We have an obligation to introduce contrarian artifacts wherever we can. In the attempt to destroy them, we will expose the naked truth of our constructed reality. It might not be pretty, but it always makes us better.
Chief executive officer