# Transaction costs

`kaal:entity:transaction-costs`

**Status.** derived

This node is assembled mechanically from the 57 claims that carry the concept tag `transaction-costs`. 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

57 claims across 34 works, 2009 to 2026.

**2009**

- [1428387-018](https://wulfkaal.github.io/claims/1428387-018) [mechanism/argued] -- State de minimis investment adviser registration exemptions can be an attractive alternative to federal law for hedge fund managers, especially in a fund's start-up phase, because state registration would require an ADV filing and significant transaction costs the manager wants to avoid.
  > Accordingly, certain state de minimis investment adviser registration exemptions for investors could be an attractive alternative to federal laws for hedge fund manager, especially in the start-up phase of a hedge fund.
  Kaal, Hedge Fund Valuation Retailization, Regulation, and Investor Suitability (2009). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1428387
- [1428387-034](https://wulfkaal.github.io/claims/1428387-034) [failure/argued] *(failure mode)* -- Requiring hedge funds to supply risk and valuation data in a simplified format would in fact impose a significant burden on the industry, since simplification requirements would raise transaction costs, require pre-screening, and possibly additional staff.
  > In addition to the utilization problem, if the SEC should require hedge funds to provide risk and valuation data in a certain simplified format, the SEC would in fact impose a significant burden on the hedge fund industry.
  Kaal, Hedge Fund Valuation Retailization, Regulation, and Investor Suitability (2009). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1428387

**2010**

- [1664809-015](https://wulfkaal.github.io/claims/1664809-015) [mechanism/argued] -- Assimilation of US legal rules into European regulatory approaches may itself increase transaction costs for the jurisdiction that changes its law.
  > Assimilation of US legal rules in turn may result in increased
  Richard W. Painter, Wulf A. Kaal, Extraterritorial Application of US Securities Law – Will the US Become the Default Jurisdiction for (2010). SSRN: https://ssrn.com/abstract=1664809
- [1664809-023](https://wulfkaal.github.io/claims/1664809-023) [mechanism/evidenced] -- Legal uncertainty generates transaction costs, and European company boards will inevitably incur costs minimizing the information asymmetries created by different legal regimes that may or may not apply to their company.
  > Legal uncertainty generates transaction costs.
  Richard W. Painter, Wulf A. Kaal, Extraterritorial Application of US Securities Law – Will the US Become the Default Jurisdiction for (2010). SSRN: https://ssrn.com/abstract=1664809

**2011**

- [1806252-006](https://wulfkaal.github.io/claims/1806252-006) [mechanism/argued] *(failure mode)* -- Regulating entities that operate in the same markets under asymmetric rules creates legal uncertainty and significant transaction costs.
  > Asymmetric regulation of entities operating in the same markets creates legal uncertainty and significant transaction costs.
  Kaal, Hedge Fund Regulation Via Basel III (2011). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1806252
- [1806252-018](https://wulfkaal.github.io/claims/1806252-018) [mechanism/argued] -- A lack of regulatory guidance creates legal uncertainty, and legal uncertainty in turn generates transaction costs.
  > A lack of guidance may create legal uncertainty,!4° and legal uncertainty generates transaction costs.
  Kaal, Hedge Fund Regulation Via Basel III (2011). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1806252
- [1806252-026](https://wulfkaal.github.io/claims/1806252-026) [design/argued] -- Implementing the hedge fund lending charge through Basel III would require no separate national implementation, because compliance falls on banks that have already joined the framework, so transaction costs for national regulators would be avoided.
  > Once the bank has signed on to join the framework, it would merely be the responsibility of the participating banks to comply with the framework. Hence, transaction costs for national regulators would be avoided.
  Kaal, Hedge Fund Regulation Via Basel III (2011). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1806252

**2013**

- [2267560-019](https://wulfkaal.github.io/claims/2267560-019) [failure/argued] *(failure mode)* -- NIE acknowledges that transaction costs, imperfect information, and bounded rationality influence the rulemaking process, with the consequence that even optimal solutions to regulatory problems become unstable and suboptimal over time.
  > NIE acknowledges that transaction costs, imperfect information, and bounded rationality influence the rulemaking process (Homann and Kirchner 1995; Furubotn and Richter 2005) and even optimal solutions to regulatory problems can become unstable and suboptimal over time.
  Wulf A. Kaal, Evolution of Law Dynamic Regulation in a New Institutional Economics Framework (2013). SSRN: https://ssrn.com/abstract=2267560
- [2267560-033](https://wulfkaal.github.io/claims/2267560-033) [failure/argued] *(failure mode)* -- Opportunistic behavior, transaction costs, and bounded rationality undermine comprehensive contracting, so contracting parties do not specify all of their respective obligations ex-ante because anticipating all contingencies is too costly.
  > Because it is too costly for contracting parties to anticipate all contingencies and to agree to necessary contract adaptations in advance (Williamson 1985), the contracting parties in the incomplete contract model do not specify all of their respective obligations under the contract ex-ante.
  Wulf A. Kaal, Evolution of Law Dynamic Regulation in a New Institutional Economics Framework (2013). SSRN: https://ssrn.com/abstract=2267560
- [2267560-035](https://wulfkaal.github.io/claims/2267560-035) [failure/argued] *(failure mode)* -- The learning process in incomplete contract theory can be improved because experimentation with different rules, rule revision, and additional rulemaking create significant transaction costs, and postponing rulemaking until sufficient information is available may not always be possible or desirable.
  > Experimentation with different rules, rule revision, and additional rulemaking create significant transaction costs8 and postponing rulemaking until sufficient information is available may not always be possible or desirable.
  Wulf A. Kaal, Evolution of Law Dynamic Regulation in a New Institutional Economics Framework (2013). SSRN: https://ssrn.com/abstract=2267560
- [2273857-010](https://wulfkaal.github.io/claims/2273857-010) [failure/argued] *(failure mode)* -- A regulatory framework that relies exclusively on stable and presumptively optimal rules cannot adequately address future challenges, and the amendments, revisions, and retractions such a framework generates create substantial transaction costs and uncertainty.
  > A regulatory framework that relies exclusively on stable and presumptively optimal rules may not be able to adequately address future challenges. Amendments, revisions, and retractions of existing rules create substantial transaction costs and uncertainty.
  Wulf A. Kaal, Dynamic Regulation of the Financial Services Industry (2013). SSRN: https://ssrn.com/abstract=2273857
- [2273857-022](https://wulfkaal.github.io/claims/2273857-022) [mechanism/evidenced] -- During and after crises, political entrepreneurs assume the transaction costs of organizing otherwise disinterested latent groups, which temporarily overcomes the predominance of special interest groups in rulemaking.
  > During and after crises, however, political entrepreneurs assume the transaction costs of organizing the otherwise disinterested latent groups to temporarily overcome the predominance of special interest groups in the rulemaking process.
  Wulf A. Kaal, Dynamic Regulation of the Financial Services Industry (2013). SSRN: https://ssrn.com/abstract=2273857

**2014**

- [kaal-2014-dynamicregulationviagove-004](https://wulfkaal.github.io/claims/kaal-2014-dynamicregulationviagove-004) [mechanism/argued] -- Dynamic elements function as an economizing device: they address the scarcity of regulatory resources and lower the cost of rulemaking by curtailing the collective action problem in rulemaking, the resulting regulatory cycles, and trial and error rulemaking.
  > Dynamic elements in the regula- tory infrastructure can be conceptualized as an economizing device that addresses the scarcity of regulatory resources and lowers the cost of rule- making by curtailing the effects of a classic collective action problem in rule- making, resulting regulatory cycles
  Kaal, Dynamic Regulation via Governmental Contracts (2014)
- [kaal-2014-dynamicregulationviagove-005](https://wulfkaal.github.io/claims/kaal-2014-dynamicregulationviagove-005) [failure/argued] *(failure mode)* -- Because transaction costs, imperfect information, and bounded rationality shape the rulemaking process, even solutions that are optimal at enactment become unstable and suboptimal over time.
  > NIE recognizes that transaction costs, imperfect infor- mation, and bounded rationality impact the rulemaking process, rendering even optimal solutions to regulatory problems unstable and suboptimal over time
  Kaal, Dynamic Regulation via Governmental Contracts (2014)
- [kaal-2014-dynamicregulationviagove-009](https://wulfkaal.github.io/claims/kaal-2014-dynamicregulationviagove-009) [failure/evidenced] *(failure mode)* -- Experimentation with different rules under the current framework of stable rulemaking carries substantial costs of rule revision and enactment, and there is evidence that this framework does not protect against systemic shocks and financial crises.
  > The costs of rule revision, rule enactment, and exper- imentation in the current framework of stable rulemaking are substantial, especially because there is some evidence25 that the existing rulemaking framework does not protect against systemic shocks and financial crises.
  Kaal, Dynamic Regulation via Governmental Contracts (2014)
- [kaal-2014-dynamicregulationviagove-029](https://wulfkaal.github.io/claims/kaal-2014-dynamicregulationviagove-029) [mechanism/argued] -- Because a governmental contract is executed only after wrongdoing has been identified and assessed, the parties can contract for governance improvements with relative precision, which reduces the amount of institution specific experimentation required and its transaction costs.
  > The assessment of corporate wrongdoing enables the parties to contract for governance im- provements with relative precision, allowing for less overall institution- specific experimentation and lower associated transaction costs.
  Kaal, Dynamic Regulation via Governmental Contracts (2014)

**2017**

- [2939127-014](https://wulfkaal.github.io/claims/2939127-014) [mechanism/argued] -- Because a public blockchain is genuinely public and immutable, it increases transparency while simultaneously and significantly reducing transaction costs.
  > Because the blockchain (at the least the public blockchain) is in fact public and immutable, the technology increases transparency, while at the same time significantly reducing transaction costs.
  Mark Fenwick, Wulf A. Kaal, Erik P. M. Vermeulen, Legal Education in the Blockchain Revolution (2017). SSRN: https://ssrn.com/abstract=2939127
- [2992962-012](https://wulfkaal.github.io/claims/2992962-012) [mechanism/argued] -- Regulating blockchain through the non anonymous application of the technology creates large inefficiencies that will be bypassed by the more efficient anonymous applications, and it is for those more advanced applications that a system of distributed jurisdiction will be needed.
  > However, that application of the technology creates large inefficiencies that will be bypassed by the more efficient applications of the technology in an anonymous setting. It is for this more advanced application of blockchain technology that a system of distributed jurisdiction will be needed.
  Wulf A. Kaal, Craig Calcaterra, Crypto Transaction Dispute Resolution (2017). SSRN: https://ssrn.com/abstract=2992962
- [2992962-036](https://wulfkaal.github.io/claims/2992962-036) [failure/argued] *(failure mode)* -- Because of the fees attached to its extra verification layer, the OpenBazaar dispute resolution mechanism creates substantial transaction costs that pure Ethereum based self executing smart contracts avoid.
  > Because of these fees, the OpeanBazaar dispute resolution mechanism creates substantial transaction costs that can be avoided by pure Ethereum-based self-executing smart contracts.
  Wulf A. Kaal, Craig Calcaterra, Crypto Transaction Dispute Resolution (2017). SSRN: https://ssrn.com/abstract=2992962
- [2992962-037](https://wulfkaal.github.io/claims/2992962-037) [design/argued] -- In contrast with OpenBazaar, the authors' proposed open source ecosystem allows dispute resolution only if and when a smart contract has actually resulted in a dispute, which keeps smart contracting transaction costs near zero.
  > In contrast with the OpenBazaar solutions, our proposed open source ecosystem allows dispute resolution only if and when a smart contract has resulted in a dispute.
  Wulf A. Kaal, Craig Calcaterra, Crypto Transaction Dispute Resolution (2017). SSRN: https://ssrn.com/abstract=2992962
- [2992962-040](https://wulfkaal.github.io/claims/2992962-040) [normative/argued] -- For crypto economy participants who wish to minimize the transaction costs of dual integration and retain anonymity, the authors' proposed open source platform ecosystem is more likely than all other available solutions to provide legal equivalence of dispute resolution mechanisms.
  > For participants in the crypto economy who wish to minimize the transaction costs of dual integration and retain anonymity, our proposed open source platform ecosystem is more likely than all other available solutions to provide legal equivalence of dispute resolution mechanisms.
  Wulf A. Kaal, Craig Calcaterra, Crypto Transaction Dispute Resolution (2017). SSRN: https://ssrn.com/abstract=2992962
- [2998033-001](https://wulfkaal.github.io/claims/2998033-001) [mechanism/asserted] -- Blockchain technology lowers transaction costs by eliminating intermediaries, and it substitutes immutability and cryptography for the trust that intermediaries previously supplied.
  > Blockchain technology's elimination of intermediaries removes transaction costs and creates a platform for trust through truth and transparency for parties through its immutability and use of cryptography.
  Wulf A. Kaal, Blockchain Innovation for Private Investment Funds (2017). SSRN: https://ssrn.com/abstract=2998033
- [2998033-023](https://wulfkaal.github.io/claims/2998033-023) [mechanism/asserted] -- Because blockchain is transparent, verifiable, self authenticating and self enforcing, financial transactions can be executed instantaneously at near zero transaction cost, which raises efficiency for businesses and individuals exponentially.
  > Because blockchain technology is transparent, verifiable, self- authenticating, and self-enforcing, financial transactions can be executed instantaneously at near zero transaction costs, increasing the efficiency for business and individuals exponentially.
  Wulf A. Kaal, Blockchain Innovation for Private Investment Funds (2017). SSRN: https://ssrn.com/abstract=2998033
- [3071378-003](https://wulfkaal.github.io/claims/3071378-003) [mechanism/argued] -- Because the public blockchain is public and immutable, the technology increases transparency while significantly reducing transaction costs, and intermediaries including lawyers are replaced by code, connectivity, crowd, and collaboration.
  > Because the blockchain (at the least the public blockchain) is in fact public and immutable, the technology increases transparency, while at the same time significantly reducing transaction costs. Intermediaries, including lawyers, are replaced by code, connectivity, crowd, and collaboration.24
  Wulf A. Kaal, Blockchain Technology and Race in Corporate America (2017). SSRN: https://ssrn.com/abstract=3071378

**2018**

- [3128900-040](https://wulfkaal.github.io/claims/3128900-040) [failure/argued] *(failure mode)* -- Payment intermediary fees such as Paypal's are viable only for higher volume workers who can eventually avoid them, so they operate as an entry barrier against new micro task workers.
  > The fees make is only economically viable for higher volume workers who can at some point avoid the Paypal fees but create barriers to entry for new micro task workers.
  Wulf A. Kaal, Decentralized Mechanical Turk Through Verified Reputation (2018). SSRN: https://ssrn.com/abstract=3128900
- [3249860-004](https://wulfkaal.github.io/claims/3249860-004) [mechanism/argued] -- Decentralized solutions can challenge the basic assumptions of the theory of the firm, because the role of the firm changes if decentralized technology lowers the cost of using markets exponentially.
  > Decentralized solutions for human interaction can challenge the basic assumptions of the theory of the firm. In other words, the role of the firm may change if decentralized solutions help lower the cost of using markets exponentially.
  Wulf A. Kaal, Crypto Economics - The Top 100 Token Models Compared (2018). SSRN: https://ssrn.com/abstract=3249860
- [3249860-005](https://wulfkaal.github.io/claims/3249860-005) [mechanism/argued] -- DAOs can replace the coordination and monitoring functions supplied by the firm, because they can measure each member's contribution to the finished work product more efficiently and allocate rewards accordingly.
  > Arguably, DAOs can replace the otherwise needed functions that are supplied by the firm that acts as the coordinator and monitor of a team because DAOs can more efficiently measure the contribution of each DAO member to the finished work product and allocate respective rewards accordingly.
  Wulf A. Kaal, Crypto Economics - The Top 100 Token Models Compared (2018). SSRN: https://ssrn.com/abstract=3249860

**2019**

- [3373393-025](https://wulfkaal.github.io/claims/3373393-025) [mechanism/asserted] -- Smart contracts enabled by blockchain technology allow comprehensive, near error free, and zero transaction and agency cost coordination of agency relationships.
  > Smart contracts enabled by blockchain technology allow for the comprehensive, near error free, and zero transaction/agency cost coordination of agency relationships.
  Wulf A. Kaal, Blockchain Solutions for Agency Problems in Corporate Governance (2019). SSRN: https://ssrn.com/abstract=3373393
- [3405401-005](https://wulfkaal.github.io/claims/3405401-005) [mechanism/asserted] -- Smart contracts benefit business by simplifying and automating transactions, removing transaction costs, and creating certainty for counterparties, and they are inexpensive to run on a blockchain.
  > Smart contracts are intended to simplify and automate business, removing transaction costs and creating certainty for counterparties. They make business transactions fully secure and efficient. It is also inexpensive to run smart contracts on a blockchain.
  Wulf A. Kaal, Decentralized Commerce – A Primer on Why Decentralized Reputation Verification Systems Are Needed (2019). SSRN: https://ssrn.com/abstract=3405401
- [3405401-006](https://wulfkaal.github.io/claims/3405401-006) [mechanism/asserted] -- Automation in smart contracting reduces negotiation between counterparties to near minimal levels and removes almost all of the transaction costs typically associated with contracting.
  > Negotiation between counterparties is near minimal, transaction cost typically associated with contracting are almost entirely removed by the automation.
  Wulf A. Kaal, Decentralized Commerce – A Primer on Why Decentralized Reputation Verification Systems Are Needed (2019). SSRN: https://ssrn.com/abstract=3405401
- [3405660-015](https://wulfkaal.github.io/claims/3405660-015) [failure/argued] *(failure mode)* -- Coordinated international cooperation in hedge fund regulation will ultimately be hindered by administrative costs, immense transaction costs, setup costs and, above all, the divergent interests of offshore havens and the resulting jurisdictional arbitrage, so it may never become a realistic regulatory option.
  > The administrative costs, the immense transaction costs as well as the costs of setting up such a venture and, most importantly, the differing interests especially of off-shore heavens and, hence, jurisdictional arbitrage will ultimately hinder such actions.
  Kaal, Indirect Regulation of Hedge Funds (2019). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3405660
- [3406323-012](https://wulfkaal.github.io/claims/3406323-012) [mechanism/argued] -- Decentralized technologies increase consumer and market trust at unprecedented scale, which lowers transaction costs and raises confidence and certainty, thereby facilitating economies of scale that centralized structures may not be able to achieve.
  > Trust can help lower transaction costs but it also increases consumer and overall market confidence and certainty, which facilitate economies of scale that may not be possible in centralized structures.
  Wulf A. Kaal, Decentralization - A Primer on the New Economy (2019). SSRN: https://ssrn.com/abstract=3406323
- [3406323-030](https://wulfkaal.github.io/claims/3406323-030) [mechanism/argued] -- Smart contracts enable anonymous parties to engage in decentralized commerce because automated contracting self-executes and self-regulates according to mathematical strictures, removing the need for agency and intermediaries almost entirely.
  > Smart contracts allow anonymous parties to engage in decentralized commerce by providing automated contracting that self-executes and self-regulates according to mathematical strictures.
  Wulf A. Kaal, Decentralization - A Primer on the New Economy (2019). SSRN: https://ssrn.com/abstract=3406323
- [3409548-023](https://wulfkaal.github.io/claims/3409548-023) [empirical/evidenced] -- Legacy systems at private investment funds and banks are more expensive, more error prone, and slower than emerging blockchain technologies, a gap illustrated by the $1.7 trillion in processing fees banks charged in 2014.
  > Most legacy systems at private investment funds and banks are much more expensive than emerging blockchain technologies, are subject to human error, and take much more time. Banks charged $1.7 trillion in processing fees in 2014.
  Kaal, Financial Technology and Hedge Funds (2019). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3409548
- [3409548-024](https://wulfkaal.github.io/claims/3409548-024) [mechanism/argued] -- Because blockchain is transparent, verifiable, self-authenticating and self-enforcing, transactions can settle instantaneously at near zero cost, and it is this combination plus technology-driven democratized trust that drove the financial industry's large blockchain investments out of fear of obsolescence.
  > Blockchain technology is transparent, verifiable, self- authenticating, and self-enforcing, financial transactions can be executed instantaneously at near zero transaction costs, increasing the efficiency for business and individuals exponentially.
  Kaal, Financial Technology and Hedge Funds (2019). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3409548
- [3411110-001](https://wulfkaal.github.io/claims/3411110-001) [failure/asserted] *(failure mode)* -- Existing ledger structures for securities offerings are defective: because individual firms rely on batch processing, the model generates dependencies, multi-day settlement times, distinctive operational risks, and duplicative costs.
  > ledger structures applicable to securities offerings are subject to significant shortcomings: While for individual firms, batch-processing is the norm, this model creates numerous dependencies, multi-day settlement times, unique operational risks, and duplicative costs.
  Wulf A. Kaal, Samuel Evans, Blockchain-Based Securities Offerings (2019). SSRN: https://ssrn.com/abstract=3411110
- [3411897-019](https://wulfkaal.github.io/claims/3411897-019) [failure/argued] *(failure mode)* -- Intermediary fees in centralized fiat payment systems make those systems economically viable only at higher transaction volumes, which creates barriers to entry that decentralized payment systems do not impose.
  > The fees make it only economically viable for higher volumes of transactions, creating barriers to entry in the process. Decentralized payment systems are not subject to these limitations.
  Wulf A. Kaal, Decentralization - Past, Present, and Future (2019). SSRN: https://ssrn.com/abstract=3411897

**2020**

- [3606663-026](https://wulfkaal.github.io/claims/3606663-026) [failure/argued] *(failure mode)* -- Centralized financial technology does not complete the disintermediation it promises, because users still deal with a technology company as intermediary instead of a financial institution, which leaves room for the decentralized solutions DeFi attempts to provide.
  > In existing centralized forms of financial technology disintermediation users are still dealing with a technology company as intermediary instead of a financial institution.286 Accordingly, centralized financial technology disintermediation is incomplete and allows for further improvements.
  Kaal, Digital Asset Market Evolution (2020). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3606663

**2021**

- [3782198-034](https://wulfkaal.github.io/claims/3782198-034) [design/speculative] -- A decentralized banking DAO built on top of the Bitcoin ledger could charge a smaller fee to hold minor transactions temporarily and bundle them into a single larger Bitcoin transaction on the eternal blockchain.
  > A good idea for a DAO is a decentralized banking system built on top of the Bitcoin ledger that charges a smaller fee for temporarily storing minor trans- actions.
  Craig Calcaterra, Wulf A. Kaal, Contemporary Decentralization (2021). SSRN: https://ssrn.com/abstract=3782198
- [3782201-007](https://wulfkaal.github.io/claims/3782201-007) [mechanism/argued] -- Code based trust in decentralized applications lowers transaction costs and simultaneously raises consumer and market confidence and certainty, which facilitates economies of scale that are only occasionally and temporarily possible in centralized structures.
  > code-based trust can help lower trans- action costs, but it also increases consumer and overall market confidence and cer- tainty, which facilitate economies of scale that are only occasionally and temporarily possible in centralized structures.
  Craig Calcaterra, Wulf A. Kaal, Future of Decentralization (2021). SSRN: https://ssrn.com/abstract=3782201
- [3782205-029](https://wulfkaal.github.io/claims/3782205-029) [mechanism/argued] -- Renegotiating contracts every time the currency's value changes is expensive and continually and randomly punishes at least one of the contracting parties.
  > Renegotiating contracts whenever the currency changes is expensive, and continually and randomly punishes at least one of the parties.
  Craig Calcaterra, Wulf A. Kaal, Eight Institutions for the Evolution of Decentralization (2021). SSRN: https://ssrn.com/abstract=3782205
- [3782216-003](https://wulfkaal.github.io/claims/3782216-003) [mechanism/argued] -- Blockchain transactions will always be expensive compared with other peer to peer transactions, because blockchain data must be stored eternally and redundantly on as many machines as possible to support decentralization.
  > Blockchain transactions will always be expensive compared with other P9P trans- actions. Blockchain transactions are required to be stored eternally and redundantly on as many machines as possible to aid decentralization.
  Craig Calcaterra, Wulf A. Kaal, Decentralized Finance (DeFi) (2021). SSRN: https://ssrn.com/abstract=3782216
- [3808867-033](https://wulfkaal.github.io/claims/3808867-033) [mechanism/argued] -- Code based trust lowers transaction costs and simultaneously raises consumer and market confidence and certainty, which facilitates economies of scale that are rarely possible in centralized structures, despite the cybersecurity problems associated with cryptocurrencies.
  > code-based trust can help lower transaction costs, but it also increases consumer and overall market confidence and certainty, which facilitate economies of scale that are rarely possible in centralized structures
  Wulf A. Kaal, How Decentralized Systems Can Upgrade AI (2021). SSRN: https://ssrn.com/abstract=3808867
- [3808867-039](https://wulfkaal.github.io/claims/3808867-039) [empirical/evidenced] -- Transacting in cash costs United States consumers roughly 200 billion dollars annually, about 637 dollars per person, driven by the costs of production, storage, and transportation.
  > In the United States, transacting in cash costs the consumer around 200 billion dollars annually— about $637 per person annually, which is a result of the cost of production, storage, and transportation, among other factors.
  Wulf A. Kaal, How Decentralized Systems Can Upgrade AI (2021). SSRN: https://ssrn.com/abstract=3808867
- [3949098-018](https://wulfkaal.github.io/claims/3949098-018) [mechanism/asserted] -- Meaningful reputation in a business network removes the need for monitoring cost and lowers transaction costs by orders of magnitude.
  > Reputation removes the need for monitoring cost. It lowers transaction costs in orders of magnitude.
  Wulf A. Kaal, Reputation as Capital – How DAOs Upgrade Finance (2021). SSRN: https://ssrn.com/abstract=3949098

**2024**

- [4734750-038](https://wulfkaal.github.io/claims/4734750-038) [condition/argued] -- Because payment runs entirely through crypto transactions and reputation tokens rather than bank transfers, the only thing a micro task worker needs to earn a living on the platform is access to the internet.
  > All that is needed for a micro task worker to earn a living on the CRDAO is access to the Internet.
  Wulf A. Kaal, Code Review DAO (2024). SSRN: https://ssrn.com/abstract=4734750
- [4755632-013](https://wulfkaal.github.io/claims/4755632-013) [failure/argued] *(failure mode)* -- Because unmanaged centralized micro task platforms do not supply the consumer interfaces needed to accomplish specific tasks, requesters must either build their own tools or pay large fees to startups, and both necessary options result in underutilization of resources.
  > because unmanaged centralized micro task platforms do not supply consumer interfaces needed to accomplish specific tasks, requesters of micro task work are forced to either build their own tools or pay large fees to startups
  Wulf A. Kaal, AI Learning - Decentralized Governance to Optimize Human Output Datasets for AI Learning (2024). SSRN: https://ssrn.com/abstract=4755632
- [4755632-039](https://wulfkaal.github.io/claims/4755632-039) [design/argued] -- Operating entirely through crypto transactions removes the transaction costs of micro task work, because centralized mechanical turk platforms require an existing banking relationship to transfer payment to workers who are otherwise unbanked.
  > Unlike centralized mechanical turk platforms that require an existing banking relationship to receive account transfers for otherwise unbanked micro task workers, the ALE Platform operates entirely through crypto transactions.
  Wulf A. Kaal, AI Learning - Decentralized Governance to Optimize Human Output Datasets for AI Learning (2024). SSRN: https://ssrn.com/abstract=4755632
- [4900878-008](https://wulfkaal.github.io/claims/4900878-008) [definitional/argued] -- Quantum economics and New Institutional Economics diverge at the level of first principles: NIE treats uncertainty as something institutions exist to reduce, while quantum economics treats uncertainty and indeterminacy as constitutive features of economic interaction.
  > While NIE emphasizes the role of institutions in reducing uncertainties and fostering economic stability, quantum economics inherently incorporates uncertainty
  Wulf A. Kaal, Quantum Economy and Tokenomics (2024). SSRN: https://ssrn.com/abstract=4900878
- [5254152-006](https://wulfkaal.github.io/claims/5254152-006) [mechanism/asserted] -- Smart contracts, as self executing contracts with terms written directly into code, remove the need for intermediaries, which lowers costs and raises trust among participants.
  > Smart contracts, self-executing contracts with terms directly written into code, eliminate the need for intermediaries, reducing costs and increasing trust among participants.
  Wulf A. Kaal, DAO Market Meta Analysis 2024 (2024). SSRN: https://ssrn.com/abstract=5254152

**2025**

- [5095633-026](https://wulfkaal.github.io/claims/5095633-026) [mechanism/argued] -- High transaction costs in centralized payment systems make micro-payments for small tasks uneconomic, whereas blockchain ledgers process tiny transfers efficiently and thereby widen the pool of contributors willing to do micro-tasks.
  > High transaction costs in centralized models often preclude micro-payments for smaller tasks. In contrast, blockchain-based ledgers can process tiny financial transfers efficiently, facilitating fair compensation for incremental work and expanding the pool of potential contributors
  Wulf A. Kaal, Artificial Intelligence The Final Frontier (2025). SSRN: https://ssrn.com/abstract=5095633
- [5554218-022](https://wulfkaal.github.io/claims/5554218-022) [mechanism/argued] *(failure mode)* -- Automating smart contracts under the code is law paradigm incentivizes unethical behavior by enabling anonymous, opportunistic action, which reduces repeat business and undermines the minimization of transaction costs.
  > The automation of smart contracts under "code is law" incentivizes unethical behavior by enabling anonymous, opportunistic actions, reducing repeat business and undermining transaction cost minimization.
  Furrer Andreas, Wulf A. Kaal, Universal Digital Law Codex (UDLC) Building the Legal Infrastructure for the Digital Era (2025). SSRN: https://ssrn.com/abstract=5554218
- [5886442-002](https://wulfkaal.github.io/claims/5886442-002) [definitional/asserted] -- Kaal stipulates two constructs: Agentic Decoupling, the progressive severance of value creation from human labor and consumption, and the Coasean Singularity, the point at which the theoretical justification for hierarchical governance disappears.
  > The analysis introduces Agentic Decoupling, described as the progressive severance of value creation from human labor and consumption. And the Coasean Singularity, described as the point at which the theoretical justification for hierarchical governance disappears.
  Wulf A. Kaal, The AI-to-AI Economy and the Collapse of Anthropocentric Economic Theory (2025). SSRN: https://ssrn.com/abstract=5886442
- [5886442-026](https://wulfkaal.github.io/claims/5886442-026) [mechanism/argued] -- Opportunism is engineered away in the AI-to-AI economy because agents have no endogenous psychological motives for guile and operate under mathematically specified, cryptographically verifiable objective functions.
  > Opportunism is engineered away: agents have no endogenous psychological motives for guile and operate under mathematically specified, cryptographically verifiable objective functions
  Wulf A. Kaal, The AI-to-AI Economy and the Collapse of Anthropocentric Economic Theory (2025). SSRN: https://ssrn.com/abstract=5886442
- [5886442-027](https://wulfkaal.github.io/claims/5886442-027) [definitional/argued] -- When all five drivers of positive transaction costs approach zero at once, transaction costs themselves asymptotically approach zero, a point the author names the Coasean Singularity: the point at which the rationale for the firm, for hierarchical governance, for relational contracting and for most formal institutions disappears.
  > When all five drivers of positive transaction costs approach zero simultaneously, transaction costs themselves asymptotically approach zero. This is what I have termed the Coasean Singularity herein, that is, the point at which the very rationale for the firm
  Wulf A. Kaal, The AI-to-AI Economy and the Collapse of Anthropocentric Economic Theory (2025). SSRN: https://ssrn.com/abstract=5886442
- [5886442-036](https://wulfkaal.github.io/claims/5886442-036) [design/argued] -- When the five drivers of positive transaction costs are simultaneously eliminated, the theoretical justification for firms, contracts and most formal institutions disappears, and the task of governance shifts from minimizing frictions to orchestrating abundance.
  > When the five drivers of positive transaction costs are simultaneously eliminated, the theoretical justification for firms, contracts, and most formal institutions disappears. Governance shifts from minimizing frictions to orchestrating abundance
  Wulf A. Kaal, The AI-to-AI Economy and the Collapse of Anthropocentric Economic Theory (2025). SSRN: https://ssrn.com/abstract=5886442

**2026**

- [6421319-030](https://wulfkaal.github.io/claims/6421319-030) [mechanism/argued] -- The AI2AI economy eliminates all the drivers of positive transaction costs at the substrate level simultaneously: opportunism is engineered away because agents lack endogenous psychological motives for guile and operate under cryptographically verifiable objective functions.
  > The AI2AI economy simultaneously eliminates every one of these constraints at the substrate level. Opportunism is engineered away: agents possess no endogenous psychological motives for guile and operate under cryptographically verifiable objective functions.
  Wulf A. Kaal, The Collapse of Scarcity Economics (2026). SSRN: https://ssrn.com/abstract=6421319

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