# Security

`kaal:entity:security`

**Status.** derived

This node is assembled mechanically from the 37 claims that carry the concept tag `security`. It is a roster of what the corpus says under this term. It is **not** an adjudicated definition: no single statement here has been ruled canonical, and no first-appearance call has been made. Read the claims and judge for yourself.

## Every claim under this term

37 claims across 22 works, 2017 to 2024.

**2017**

- [2939127-018](https://wulfkaal.github.io/claims/2939127-018) [condition/argued] -- Smart contract arrangements involving several parties and greater complexity require the verifiable and unhackable system that blockchain technology supplies.
  > More complex smart contract arrangements in which several parties are involved require a verifiable and unhackable system provided by blockchain technology.
  Mark Fenwick, Wulf A. Kaal, Erik P. M. Vermeulen, Legal Education in the Blockchain Revolution (2017). SSRN: https://ssrn.com/abstract=2939127
- [3002908-017](https://wulfkaal.github.io/claims/3002908-017) [condition/asserted] -- Complex smart contracts involving several parties can only work if they rest on a verifiable and unhackable system, which is what blockchain technology supplies.
  > Complex smart contracts involving several parties need to rely on a verifiable and unhackable system provided by blockchain technology.
  Wulf A. Kaal, Marco Dell'Erba, Blockchain Innovation in Private Investment Funds - A Comparative Analysis of the United States and (2017). SSRN: https://ssrn.com/abstract=3002908

**2018**

- [3125822-010](https://wulfkaal.github.io/claims/3125822-010) [design/argued] -- The chosen expert is deliberately not paid directly out of the fee but only indirectly in newly minted tokens, because the architecture secures itself by making reputation more valuable than any one time payment.
  > One counterintuitive element is that the chosen expert is not paid directly in fees, only indirectly in newly minted tokens. The platform was designed to ensure security, and encourage maximal productive cooperation, by valuing reputation over all else.
  Craig Calcaterra, Wulf A. Kaal, Vlad Andrei, Blockchain Infrastructure for Measuring Domain Specific Reputation in Autonomous Decentralized and A (2018). SSRN: https://ssrn.com/abstract=3125822
- [3125822-011](https://wulfkaal.github.io/claims/3125822-011) [mechanism/argued] -- Enforcing a protocol in which all work fees are shared with the expertise produces a positive feedback loop: more fees raise the worth of reputation, which makes sem tokens more desirable than one time fees, which makes vested experts police the system carefully, which makes the system more secure.
  > The more fees are sent to the platform, the more the reputation is worth; which means the sem tokens will be more desirable to experts than one-time fees; which means the system will be carefully policed by vested experts; this makes the system more secure
  Craig Calcaterra, Wulf A. Kaal, Vlad Andrei, Blockchain Infrastructure for Measuring Domain Specific Reputation in Autonomous Decentralized and A (2018). SSRN: https://ssrn.com/abstract=3125822
- [3125822-018](https://wulfkaal.github.io/claims/3125822-018) [mechanism/argued] -- Healthy expertise tags are secure not because attack is impossible but because it is easier to profit from them by improving them than by harming them.
  > Healthy expertises are secure because it is easier to profit from them by improving them than by harming them.
  Craig Calcaterra, Wulf A. Kaal, Vlad Andrei, Blockchain Infrastructure for Measuring Domain Specific Reputation in Autonomous Decentralized and A (2018). SSRN: https://ssrn.com/abstract=3125822
- [3125822-019](https://wulfkaal.github.io/claims/3125822-019) [empirical/argued] -- In the absolute worst case, with no safeguards at all, the price of corrupting the platform from within is a minimum of twice the total historical fees added to the system, and instituting any obvious protection raises that price steeply.
  > in the absolute worst- case scenario, the price to corrupt the system from within is a minimum of twice the total historical fees added to the system. If any obvious protections are instituted, the price to corrupt grows steeply.
  Craig Calcaterra, Wulf A. Kaal, Vlad Andrei, Blockchain Infrastructure for Measuring Domain Specific Reputation in Autonomous Decentralized and A (2018). SSRN: https://ssrn.com/abstract=3125822
- [3125822-026](https://wulfkaal.github.io/claims/3125822-026) [mechanism/argued] -- The token economy is inflationary at equilibrium, and this inflation is a feature rather than a defect because it improves security and discourages rent seeking holding of reputation.
  > The conclusion is that the economy is inflationary at equilibrium, which improves its security and discourages rent-seeking.
  Craig Calcaterra, Wulf A. Kaal, Vlad Andrei, Blockchain Infrastructure for Measuring Domain Specific Reputation in Autonomous Decentralized and A (2018). SSRN: https://ssrn.com/abstract=3125822
- [3125827-003](https://wulfkaal.github.io/claims/3125827-003) [condition/argued] -- A secure proof of stake protocol requires an incentive structure that perpetually motivates users to do three things at once: produce valuable blocks, police blocks that violate protocol, and improve the production protocols in response to gaming. Incentivizing only block production is insufficient.
  > A secure PoS protocol requires a proper incentive structure which perpetually motivates users to produce valuable blocks, to police the production of blocks which violate protocols, and to improve block production protocols in response to gaming.
  Craig Calcaterra, Wulf A. Kaal, Secure Proof of Stake Protocol (2018). SSRN: https://ssrn.com/abstract=3125827
- [3125827-038](https://wulfkaal.github.io/claims/3125827-038) [empirical/evidenced] -- The sem token economy is inflationary at equilibrium, and the authors argue this is a feature: inflation improves security and discourages rent seeking by penalizing holders who do not use their tokens to evaluate posts.
  > The conclusion is that the economy is inflationary at equilibrium, which improves its security and discourages rent-seeking.
  Craig Calcaterra, Wulf A. Kaal, Secure Proof of Stake Protocol (2018). SSRN: https://ssrn.com/abstract=3125827
- [3128900-030](https://wulfkaal.github.io/claims/3128900-030) [mechanism/argued] -- Once participants are vested through reputation, they police the system themselves, which raises security, which in turn attracts more public fees and closes the loop.
  > This in turn means the system will be carefully policed by vested constituents. This makes the system more secure; so the platform will attract more public fees.
  Wulf A. Kaal, Decentralized Mechanical Turk Through Verified Reputation (2018). SSRN: https://ssrn.com/abstract=3128900
- [3227933-028](https://wulfkaal.github.io/claims/3227933-028) [condition/argued] -- Personal happiness, freedom and expression can thrive better in a decentralized world only on the condition that the decentralized world provides a secure environment, which is why blockchain platforms attract people.
  > Personal happiness, freedom and expression can better thrive in a decentralized world, provided, of course, that it offers a secure environment. This is why so many people are intrigued and captured by blockchain platforms.
  Mark Fenwick, Wulf A. Kaal, Erik P.M. Vermeulen, Why 'Blockchain' Will Disrupt Corporate Organizations (2018). SSRN: https://ssrn.com/abstract=3227933
- [3227967-019](https://wulfkaal.github.io/claims/3227967-019) [mechanism/argued] -- Cryptographic hashing makes tampering with blockchain records extremely difficult because even a minuscule change produces a different hash value, rendering manipulation instantly and readily detectable.
  > The use of cryptographic hashes makes tampering with blockchain records even more difficult, if not impossible. 52 Cryptographic hashes comprise complex algorithms. Even a minuscule change to the blockchain will result in a different hash value, making manipulation instantly and readily detectable.
  Mark Fenwick, Wulf A. Kaal, Erik P.M. Vermeulen, Legal Education in a Digital Age Why 'Coding for Lawyers' Matters (2018). SSRN: https://ssrn.com/abstract=3227967
- [3227967-033](https://wulfkaal.github.io/claims/3227967-033) [failure/argued] *(failure mode)* -- Anonymity in blockchain organizations makes them prone to Sybil attacks and 51 percent attacks, and anonymity combined with autonomy has led to many hacks.
  > Also, the anonymity in blockchain organizations means that they are prone to "Sybil attacks" and "51% attacks." We also discussed the many examples in which the anonymity (and autonomy) have led to hacks.
  Mark Fenwick, Wulf A. Kaal, Erik P.M. Vermeulen, Legal Education in a Digital Age Why 'Coding for Lawyers' Matters (2018). SSRN: https://ssrn.com/abstract=3227967
- [3227967-036](https://wulfkaal.github.io/claims/3227967-036) [design/argued] -- The real design challenge for consensus protocols is to find a proof of stake protocol that offers both trust and security without unintentionally creating just another centralized validation system.
  > The students understood that the real challenge is to find a "proof of stake" protocol that offers both trust and security (without unintentionally creating just another centralized validation system).
  Mark Fenwick, Wulf A. Kaal, Erik P.M. Vermeulen, Legal Education in a Digital Age Why 'Coding for Lawyers' Matters (2018). SSRN: https://ssrn.com/abstract=3227967
- [3249860-040](https://wulfkaal.github.io/claims/3249860-040) [failure/argued] *(failure mode)* -- To date no blockchain coherently and comprehensively combines scale, security, and decentralization, the three objectives of the blockchain trilemma, although continued experimentation with consensus algorithms can help overcome it over time.
  > To date, no blockchain truly combines these three objectives coherently and comprehensively. Experimentation with different consensus algorithms can, over time, help overcome the blockchain trilemma.
  Wulf A. Kaal, Crypto Economics - The Top 100 Token Models Compared (2018). SSRN: https://ssrn.com/abstract=3249860

**2019**

- [3373393-036](https://wulfkaal.github.io/claims/3373393-036) [condition/argued] *(failure mode)* -- The core issues that afflict centralized governance solutions, including information asymmetries, censorship, opportunism of agents, breaches of fiduciary duties, and fraud, can only be truly removed if and when a truly decentralized public blockchain emerges that is scalable and fully secure.
  > and fraud or third-party interference, can only be truly removed to fully reform the agency relationship if and when a truly decentralized public blockchain emerges that is scalable and fully secure.
  Wulf A. Kaal, Blockchain Solutions for Agency Problems in Corporate Governance (2019). SSRN: https://ssrn.com/abstract=3373393
- [3411897-036](https://wulfkaal.github.io/claims/3411897-036) [failure/argued] *(failure mode)* -- It is immaterial whether security incidents occur on centralized exchanges, on centralized systems appended to decentralized structures, or in the decentralized systems themselves, because the public perceives the resulting security concerns as a technology risk across all of these technologies.
  > structures or the decentralized systems themselves is immaterial in this context. The security concerns are seen by the public as a technology risk across technologies.
  Wulf A. Kaal, Decentralization - Past, Present, and Future (2019). SSRN: https://ssrn.com/abstract=3411897
- [3441904-027](https://wulfkaal.github.io/claims/3441904-027) [condition/argued] -- Reform of agency relationships in decentralized systems is possible only if and when a truly decentralized public blockchain emerges that is scalable and fully secure; without it, information asymmetries, censorship, agent opportunism, and system corruption may persist.
  > In decentralized systems, reform of the agency relationships is possible if and when a truly decentralized public blockchain emerges that is scalable and fully secure.
  Wulf A. Kaal, Blockchain-Based Corporate Governance (2019). SSRN: https://ssrn.com/abstract=3441904

**2020**

- [3606663-034](https://wulfkaal.github.io/claims/3606663-034) [failure/argued] *(failure mode)* -- In the early 2020s the DeFi technology infrastructure was insufficiently developed to support DeFi growth estimates and growth potential, and fulfilling that potential requires significant tradeoffs between scaling, security, and levels of decentralization.
  > In the early 2020s, the DeFi technology infrastructure was insufficiently developed to support DeFi growth estimates and growth potential.
  Kaal, Digital Asset Market Evolution (2020). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3606663
- [3606663-036](https://wulfkaal.github.io/claims/3606663-036) [mechanism/argued] *(failure mode)* -- Consensus in decentralized systems presents a two sided cost problem: creating consensus raises the costs of prepping, processing, and storing information, while reducing the number of computational checks increases the risk of collusion attacks that could change the record.
  > Creating consensus requires increase costs of prepping, processing, and storing information.333 On the other hand, fewer computational checks for consensus increase the risk of collusion attacks that could change the record.
  Kaal, Digital Asset Market Evolution (2020). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3606663

**2021**

- [3782191-022](https://wulfkaal.github.io/claims/3782191-022) [failure/argued] *(failure mode)* -- Centralized coordination enables attack coordination because the hierarchical structure allows attackers to identify a single point of failure, whereas the constantly morphing information flow of decentralized systems increases their attack resistance.
  > Centralized coordination enables attack coordination because the hierarchical struc- ture allows the identification of a single point of failure.
  Craig Calcaterra, Wulf A. Kaal, Preface to (2021). SSRN: https://ssrn.com/abstract=3782191
- [3782198-029](https://wulfkaal.github.io/claims/3782198-029) [mechanism/argued] -- A blockchain is immutable because any attempt to edit an old block changes the hash of that information and is immediately rejected by the network that follows the protocol.
  > The blockchain is immutable, because any attempt to edit the old blocks will be immediately rejected by the network. A single number or letter changed anywhere in its entire history will result in a different hash of the information.
  Craig Calcaterra, Wulf A. Kaal, Contemporary Decentralization (2021). SSRN: https://ssrn.com/abstract=3782198
- [3782210-008](https://wulfkaal.github.io/claims/3782210-008) [failure/argued] *(failure mode)* -- A Web of Trust style reputation ledger, in which each party rates each transaction and reputation is summed with weightings by rater reputation, will have all of its value drained by the sockpuppet attack, because an attacker can build reputation through transactions between their own fake accounts and then use it to cheat.
  > Unfortunately, the sockpuppet attack will suck all value from the network. Setting up fake accounts, an attacker can build their reputation by making transactions be- tween their own accounts. Once their reputation is sufficiently large to trick a mem- ber, they can use it to cheat the system.
  Craig Calcaterra, Wulf A. Kaal, The Importance of Reputation for the Evolution of Decentralization (2021). SSRN: https://ssrn.com/abstract=3782210
- [3782210-009](https://wulfkaal.github.io/claims/3782210-009) [failure/argued] *(failure mode)* -- Charging transaction fees or imposing KYC identity protocols does not solve the sockpuppet problem: such defenses push the cost of defending the network onto users, and the defense cost equals what it is worth to break the defense while being multiplied across every transaction with every member.
  > This doesn't help. Such defenses push the cost of defending the network onto the users. The cost to defend it is exactly as much as it is worth to break the defense, except it's multiplied on every transaction with every member in the system.
  Craig Calcaterra, Wulf A. Kaal, The Importance of Reputation for the Evolution of Decentralization (2021). SSRN: https://ssrn.com/abstract=3782210
- [3782210-010](https://wulfkaal.github.io/claims/3782210-010) [condition/argued] *(failure mode)* -- Reducing member anonymity weakens rather than strengthens a decentralized network, because personal privacy protects members and lets them be more transparent in their dealings without fear of victimization.
  > Further, lessening the anonymity of your members weakens the power of the de- centralized network. Personal privacy protects your members, so it's more secure.
  Craig Calcaterra, Wulf A. Kaal, The Importance of Reputation for the Evolution of Decentralization (2021). SSRN: https://ssrn.com/abstract=3782210
- [3782210-011](https://wulfkaal.github.io/claims/3782210-011) [design/argued] *(failure mode)* -- The Web of Trust works acceptably for low-value information transmission but should not be used for transactions involving larger wealth in the general economy, which is part of why the scheme it originated in is called pretty good privacy rather than good privacy.
  > It works well for low-value infor- mation transmission, but it should not be used for transactions involving larger wealth in the general economy.
  Craig Calcaterra, Wulf A. Kaal, The Importance of Reputation for the Evolution of Decentralization (2021). SSRN: https://ssrn.com/abstract=3782210
- [3782210-016](https://wulfkaal.github.io/claims/3782210-016) [design/argued] -- Newly minted reputation tokens should enter the system neutral, staked half in favor and half against the post that generated the fee, so that existing token holders can judge the action fairly and are not swayed by an unbalanced validation pool created by a large new fee.
  > For security, when a reputation token enters the system, it should be neutral, so that one faction is not favored over another. Validation pools should begin fairly. Newly minted reputation tokens should be staked half in favor, half against.
  Craig Calcaterra, Wulf A. Kaal, The Importance of Reputation for the Evolution of Decentralization (2021). SSRN: https://ssrn.com/abstract=3782210
- [3782210-028](https://wulfkaal.github.io/claims/3782210-028) [mechanism/evidenced] -- With the balanced staking and fee-sharing necessities implemented, the cost of faking reputation is at an absolute minimum double the value of that reputation, which is how reputation is made more valuable than money.
  > With #e and #j implemented, the cost of faking your reputation is (at an absolute minimum) double the value of the reputation.
  Craig Calcaterra, Wulf A. Kaal, The Importance of Reputation for the Evolution of Decentralization (2021). SSRN: https://ssrn.com/abstract=3782210
- [3782214-016](https://wulfkaal.github.io/claims/3782214-016) [failure/argued] *(failure mode)* -- Rigid code is law contracts must become extremely complex to cover the eventualities of real business situations, and bugs or hacks can never be certainly precluded in any programmable contract.
  > Moreover, rigid "code is law" smart contracts will need to be extremely complex to account for the many possible eventualities of practical business situations. The insurmountable reality is that bugs or hacks can never be certainly precluded in any programmable contract.
  Craig Calcaterra, Wulf A. Kaal, Decentralized Governance (2021). SSRN: https://ssrn.com/abstract=3782214
- [3782217-014](https://wulfkaal.github.io/claims/3782217-014) [condition/argued] -- A decentralized oracle is not secure until it has significant momentum and history, and it is not even truly decentralized until it has a large network of active members.
  > A decen- tralized oracle is not secure until it has significant momentum and history—an oracle is not even truly decentralized until this is achieved, until it has a large network of active members.
  Craig Calcaterra, Wulf A. Kaal, The Importance of History In Decentralization (2021). SSRN: https://ssrn.com/abstract=3782217

**2024**

- [4796714-009](https://wulfkaal.github.io/claims/4796714-009) [failure/evidenced] *(failure mode)* -- Federated learning does not eliminate privacy risk, because although the data stays decentralized the exchange of model parameters can still expose sensitive information if those parameters are intercepted or improperly handled.
  > These challenges arise because, while FL keeps data decentralized, it still involves the exchange of model parameters, which could potentially expose sensitive information if intercepted or improperly handled.
  Wulf A. Kaal, AI Governance (2024). SSRN: https://ssrn.com/abstract=4796714
- [4796714-013](https://wulfkaal.github.io/claims/4796714-013) [condition/argued] *(failure mode)* -- Blockchain can only deliver decentralized AI governance if the blockchain trilemma is first overcome, since decentralization, security, and scalability cannot readily be achieved simultaneously within one network.
  > The effectiveness of blockchain in achieving the goal of decentralized AI governance is contingent upon overcoming the fundamental blockchain trilemma: the challenge of balancing decentralization, security, and scalability.
  Wulf A. Kaal, AI Governance (2024). SSRN: https://ssrn.com/abstract=4796714
- [4900878-003](https://wulfkaal.github.io/claims/4900878-003) [failure/argued] *(failure mode)* -- Current cryptographic systems such as RSA rest on the classical difficulty of factoring large primes, so quantum algorithms like Shor's algorithm, which factor exponentially faster, can render those cryptographic methods obsolete.
  > Quantum algorithms, such as Shor's algorithm, can factor these numbers exponentially faster, potentially rendering existing cryptographic methods obsolete.
  Wulf A. Kaal, Quantum Economy and Tokenomics (2024). SSRN: https://ssrn.com/abstract=4900878
- [4900880-005](https://wulfkaal.github.io/claims/4900880-005) [failure/argued] *(failure mode)* -- Quantum algorithms such as Shor's algorithm can factor large prime numbers exponentially faster than classical computers, which potentially renders currently deployed cryptographic systems including RSA obsolete.
  > Quantum algorithms, such as Shor's algorithm, can factor these numbers exponentially faster, potentially rendering existing cryptographic methods obsolete.
  Wulf A. Kaal, Quantum Economy and the Future of Work (2024). SSRN: https://ssrn.com/abstract=4900880
- [4900880-006](https://wulfkaal.github.io/claims/4900880-006) [condition/argued] -- Trust and security in digital financial systems and decentralized networks cannot survive the arrival of quantum computing without quantum resistant cryptographic protocols, making the shift to quantum safe cryptography a precondition for the quantum economy rather than an optional upgrade.
  > This development necessitates the creation of quantum-resistant cryptographic protocols to secure transactions and data in the quantum economy. The shift towards quantum-safe cryptography will be critical to maintaining trust and security in digital financial systems and decentralized networks.
  Wulf A. Kaal, Quantum Economy and the Future of Work (2024). SSRN: https://ssrn.com/abstract=4900880
- [4941807-012](https://wulfkaal.github.io/claims/4941807-012) [failure/argued] *(failure mode)* -- Federated learning does not eliminate privacy risk, because although the data stays decentralized the protocol still exchanges model parameters, and those parameters can expose sensitive information if intercepted or improperly handled.
  > These challenges arise because, while FL keeps data decentralized, it still involves the exchange of model parameters, which could potentially expose sensitive information if intercepted or improperly handled.
  Wulf A. Kaal, AI Governance Via Web3 Reputation System (2024). SSRN: https://ssrn.com/abstract=4941807
- [5254152-008](https://wulfkaal.github.io/claims/5254152-008) [failure/asserted] *(failure mode)* -- DAOs still face unresolved challenges of scalability, governance, and the need for robust security measures, which constrain their adoption despite their potential.
  > Despite their potential, DAOs face challenges such as scalability, governance issues, and the need for robust security measures.
  Wulf A. Kaal, DAO Market Meta Analysis 2024 (2024). SSRN: https://ssrn.com/abstract=5254152

## Verify

Every claim above resolves to a record carrying a verbatim source quote, the sha256 of the source PDF, and a preformatted citation. Nothing here asks to be taken on trust.

    curl -s https://wulfkaal.github.io/entities/security.md | sha256sum

**Canonical form.** This markdown file is the canonical hashed representation of this entity node. Its sha256 is the content hash.