{
 "failure_mode": "staking-and-incentive-misalignment",
 "specific_names": [
  "Asymmetric Payoff for Net Negative Ventures",
  "DAO extinction by fee loss",
  "Generation not internalized",
  "Incentive Duality Failure",
  "Monodimensional gamification",
  "No Incentive to Find Flaws",
  "Nothing at Stake Voting",
  "Off-protocol generation",
  "Quantity-only reward",
  "Reliance on good will",
  "Smart contract zero-sum trap",
  "Strategic breach when token value falls below claim",
  "Unbalanced reward structure",
  "Unrewarded generation",
  "altruism-cliff",
  "capped raise induces investor frenzy",
  "capped-raise-frenzy",
  "citation disincentive",
  "consensus contributions unrewarded",
  "currency as proximal goal",
  "deferred obligation drag",
  "design parameter failure",
  "equity collapse through eliminated reward",
  "exclusion driven node shutdown",
  "expansion dependent stability",
  "expectation-of-free-node-service",
  "fee mismatch arbitration failure",
  "fungible-payment-capture",
  "implicit maximal leaching",
  "incentive deficit",
  "knowledge-hoarding",
  "late entrant disincentive",
  "late-entrant-disincentive",
  "majority-reward-incentive-distortion",
  "nothing at stake",
  "opaque reward eligibility",
  "pyramid scheme expertise tag",
  "reward seeking crowding out expertise",
  "shareholder-collusion-on-minting",
  "single-sided-incentives",
  "speculative-incentive-design",
  "split-the-difference-arbitration",
  "structural rather than calibration flaw",
  "suboptimal social proof incentive design",
  "success-penalty-in-per-connection-pricing",
  "transparency privacy tradeoff",
  "unclear-utility-token-regulatory-status",
  "under-citation incentive",
  "underwriting breach",
  "unmastered incentive duality",
  "unqualified-monetary-policy-designer",
  "unsustainable-open-source",
  "voting crowds out commenting"
 ],
 "count": 53,
 "claims": [
  {
   "id": "kaal:claim:617681-037",
   "url": "https://wulfkaal.github.io/claims/617681-037",
   "claim": "Compensating arbitrators by the number of cases they hear gives litigants a substantial role in shaping the system but may yield decisions so eager to please all parties that they lack decisiveness, sound reasoning and value as precedent.",
   "specific_name": "split-the-difference-arbitration",
   "conditions": [
    "conventional arbitration in which litigants select and pay arbitrators"
   ],
   "source": "Regulatory Competition in EU Corporate Law after Inspire Art Unbundling Delaware's Product for Euro",
   "year": "2004",
   "quote": "This approach gives litigants a substantial role in shaping the arbitration system, but may result in decisions that are so eager to please all parties that they lack decisiveness or sound legal reasoning and thus lack value as precedent.",
   "citation": "Christian Kirchner, Richard W. Painter, Wulf A. Kaal, Regulatory Competition in EU Corporate Law after Inspire Art Unbundling Delaware's Product for Euro (2004). SSRN: https://ssrn.com/abstract=617681"
  },
  {
   "id": "kaal:claim:2992962-035",
   "url": "https://wulfkaal.github.io/claims/2992962-035",
   "claim": "The economic incentive for Aragon judges to follow the more popular vote, since judges keep their bond only if they voted with the majority, calls into question whether the mechanism delivers effective, non arbitrary, and fair dispute resolution.",
   "specific_name": "majority-reward-incentive-distortion",
   "conditions": [
    "the Aragon bond and majority reward mechanism, despite anonymous voting"
   ],
   "source": "Crypto Transaction Dispute Resolution",
   "year": "2017",
   "quote": "the economic incentives for judges to follow a more popular vote (in the Aragon system judges keep their bond if they voted with the majority), despite the overall anonymity of the voting, may call required notions of effective, non- arbitrary, and fair dispute resolution mechanisms into question.",
   "citation": "Wulf A. Kaal, Craig Calcaterra, Crypto Transaction Dispute Resolution (2017). SSRN: https://ssrn.com/abstract=2992962"
  },
  {
   "id": "kaal:claim:3125822-013",
   "url": "https://wulfkaal.github.io/claims/3125822-013",
   "claim": "The tragedy of the commons arises in any system lacking a well designed incentive structure; in blockchain proof of stake design this is the nothing at stake problem, where unregulated systems lead pseudonymous users to abuse the system.",
   "specific_name": "nothing at stake",
   "conditions": [
    "systems without well designed incentive structures",
    "pseudonymous participation"
   ],
   "source": "Blockchain Infrastructure for Measuring Domain Specific Reputation in Autonomous Decentralized and A",
   "year": "2018",
   "quote": "Similarly, the tragedy of the commons occurs in any system which does not have well designed incentive structure. This is called the \"nothing at stake\" problem in blockchain proof of stake design, where unregulated systems lead pseudonymous users to abuse the system.",
   "citation": "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"
  },
  {
   "id": "kaal:claim:3125822-025",
   "url": "https://wulfkaal.github.io/claims/3125822-025",
   "claim": "A healthy expertise tag requires that fees from new commenters buying in remain smaller in the long term than fees from outside business; otherwise the expertise tag is simply a pyramid scheme.",
   "specific_name": "pyramid scheme expertise tag",
   "conditions": [
    "long term steady state of a mature expertise tag"
   ],
   "source": "Blockchain Infrastructure for Measuring Domain Specific Reputation in Autonomous Decentralized and A",
   "year": "2018",
   "quote": "New commenter fees are expected to be smaller than outside business fees in the long term for healthy expertise tags; otherwise the expertise tag is simply a pyramid scheme.",
   "citation": "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"
  },
  {
   "id": "kaal:claim:3125822-027",
   "url": "https://wulfkaal.github.io/claims/3125822-027",
   "claim": "Because earlier minted tokens pay out more than later ones at a steady fee rate, later experts have less motivation to join, and the remedy available to the bench is to change the exchange rate between fees and sem tokens to attract new recruits.",
   "specific_name": "late entrant disincentive",
   "conditions": [
    "assumes a steady state rate of incoming fees",
    "tokens are never destroyed"
   ],
   "source": "Blockchain Infrastructure for Measuring Domain Specific Reputation in Autonomous Decentralized and A",
   "year": "2018",
   "quote": "This may mean later experts have less motivation to join if fees paid into the system are at a steady state. To combat this, the bench may choose to change the exchange rate between fees and sem tokens to encourage new recruits.",
   "citation": "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"
  },
  {
   "id": "kaal:claim:3125822-029",
   "url": "https://wulfkaal.github.io/claims/3125822-029",
   "claim": "Arbitration on the platform fails at either end of the fee range: if the parties set fees too low the selected arbiter refuses the work and the arbitration fails, and if arbiters demand fees higher than the public will pay they fail to attract cases.",
   "specific_name": "fee mismatch arbitration failure",
   "conditions": [
    "fees are set by the contracting parties, not by the platform"
   ],
   "source": "Blockchain Infrastructure for Measuring Domain Specific Reputation in Autonomous Decentralized and A",
   "year": "2018",
   "quote": "If the fees chosen by the contracting parties are insufficient, the arbitration will fail as the arbiter selected will refuse to do the work. If the arbiters require fees higher than the public is willing to pay, they will fail to attract cases.",
   "citation": "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"
  },
  {
   "id": "kaal:claim:3125822-044",
   "url": "https://wulfkaal.github.io/claims/3125822-044",
   "claim": "If tokens minted for each post carry equal weight, then uncontroversial comments are not rewarded at all, because a universally upvoted improvement leaves no contrarian reputation staked and lost for the poster to win.",
   "specific_name": "consensus contributions unrewarded",
   "conditions": [
    "applies to the unweighted version of the forum"
   ],
   "source": "Blockchain Infrastructure for Measuring Domain Specific Reputation in Autonomous Decentralized and A",
   "year": "2018",
   "quote": "If the tokens that are minted for each post have equal weight, then comments which are not controversial are not rewarded.",
   "citation": "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"
  },
  {
   "id": "kaal:claim:3125822-045",
   "url": "https://wulfkaal.github.io/claims/3125822-045",
   "claim": "Under equal token weighting a successful poster receives no greater reward than the upvoters who merely read and vote, so the system pays the same for crafting a comment as for voting on it, which encourages voting over commenting.",
   "specific_name": "voting crowds out commenting",
   "conditions": [
    "assumes very low denial of service fees for posting"
   ],
   "source": "Blockchain Infrastructure for Measuring Domain Specific Reputation in Autonomous Decentralized and A",
   "year": "2018",
   "quote": "Similarly, successful comments (assuming very low DoS fees) give their posters no greater reward than their fellow upvoters receive. So the same reward is given for crafting a comment as is given for reading and voting, which encourages voting over commenting.",
   "citation": "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"
  },
  {
   "id": "kaal:claim:3249860-001",
   "url": "https://wulfkaal.github.io/claims/3249860-001",
   "claim": "Crypto-economic incentive design is only limitedly successful at shaping future human behavior, because the designer must speculate about future human mental states and belief systems that may turn out entirely different from what was anticipated.",
   "specific_name": "speculative-incentive-design",
   "conditions": [
    "designs that rely on assumptions about human reactions to economic incentives"
   ],
   "source": "Crypto Economics - The Top 100 Token Models Compared",
   "year": "2018",
   "quote": "Shaping future human behavior through incentive design is limitedly successful7 because the social engineer speculates about human future mental states and corresponding belief systems.",
   "citation": "Wulf A. Kaal, Crypto Economics - The Top 100 Token Models Compared (2018). SSRN: https://ssrn.com/abstract=3249860"
  },
  {
   "id": "kaal:claim:3249860-007",
   "url": "https://wulfkaal.github.io/claims/3249860-007",
   "claim": "The democratization of monetary policy in token economies creates a serious problem, because token designers lack the qualifications and institutional functions that centralized central banking distributes across multiple institutions and their staff.",
   "specific_name": "unqualified-monetary-policy-designer",
   "conditions": [
    "token economies in which the designer sets supply, timing, and allocation"
   ],
   "source": "Crypto Economics - The Top 100 Token Models Compared",
   "year": "2018",
   "quote": "This creates a serious problem for many token economies as the designers lack the qualifications and functions that are",
   "citation": "Wulf A. Kaal, Crypto Economics - The Top 100 Token Models Compared (2018). SSRN: https://ssrn.com/abstract=3249860"
  },
  {
   "id": "kaal:claim:3128900-034",
   "url": "https://wulfkaal.github.io/claims/3128900-034",
   "claim": "Existing decentralized gamification attempts for micro task workers fail because they are monodimensional and permit earning only by playing the game, whereas a multidimensional design gives players several ways to earn and builds stronger loyalty.",
   "specific_name": "Monodimensional gamification",
   "conditions": [
    "decentralized micro task platforms using gamification"
   ],
   "source": "Decentralized Mechanical Turk Through Verified Reputation",
   "year": "2018",
   "quote": "Unlike other decentralized gamification attempts for micro task workers that are monodimensional and only allow earning by playing the game, the Semada platform offers players multiple opportunities to earn by playing.",
   "citation": "Wulf A. Kaal, Decentralized Mechanical Turk Through Verified Reputation (2018). SSRN: https://ssrn.com/abstract=3128900"
  },
  {
   "id": "kaal:claim:3117224-006",
   "url": "https://wulfkaal.github.io/claims/3117224-006",
   "claim": "Capped ICO raises, adopted to address investor uncertainty about platform valuation in uncapped raises, backfire by creating strong incentives for investors to get in first and thereby raising the likelihood of retail investor frenzy.",
   "specific_name": "capped-raise-frenzy",
   "conditions": [
    "capped ICO raises"
   ],
   "source": "Initial Coin Offerings The Top 25 Jurisdictions and Their Comparative Regulatory Responses",
   "year": "2018",
   "quote": "However, capped ICO raises crate significant incentive for investors to attempt to get in first, raising the likelihood of retail investor frenzy.",
   "citation": "Wulf A. Kaal, Initial Coin Offerings The Top 25 Jurisdictions and Their Comparative Regulatory Responses (2018). SSRN: https://ssrn.com/abstract=3117224"
  },
  {
   "id": "kaal:claim:3125827-020",
   "url": "https://wulfkaal.github.io/claims/3125827-020",
   "claim": "The current dominance of altruists in the crypto space will not persist: once the crypto economy matures, an influx of hedgers and rent seekers can be anticipated with certainty, and they will exploit any weakness in the system for profit.",
   "specific_name": "altruism-cliff",
   "conditions": [
    "maturation of the crypto economy beyond its emerging industry phase"
   ],
   "source": "Secure Proof of Stake Protocol",
   "year": "2018",
   "quote": "However, once the crypto economy is mature, we cannot assume users will continue to behave altruistically. We can anticipate, with certainty, an influx of hedgers and rent seekers who will quite naturally exploit any weakness in the system for profit.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, Secure Proof of Stake Protocol (2018). SSRN: https://ssrn.com/abstract=3125827"
  },
  {
   "id": "kaal:claim:3125827-039",
   "url": "https://wulfkaal.github.io/claims/3125827-039",
   "claim": "Because earlier sem tokens represent a larger percentage of the total and therefore pay out more, later experts have less motivation to join when fees are at a steady state; the authors propose that the bench may need to change the fee to token exchange rate to recruit new members.",
   "specific_name": "late-entrant-disincentive",
   "conditions": [
    "steady state rate of fees paid into the expertise",
    "tokens created with every fee and never destroyed"
   ],
   "source": "Secure Proof of Stake Protocol",
   "year": "2018",
   "quote": "This may mean later experts have less motivation to join if fees paid into the system are at a steady state. To combat this, the bench may choose to change the exchange rate between fees and sem tokens to encourage new recruits.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, Secure Proof of Stake Protocol (2018). SSRN: https://ssrn.com/abstract=3125827"
  },
  {
   "id": "kaal:claim:3441904-017",
   "url": "https://wulfkaal.github.io/claims/3441904-017",
   "claim": "If curators and contractors are paid from a fungible currency source without a direct or indirect penalty for underperformance, such as lower token scores, DAO contractors and workers may be corrupted by external sources.",
   "specific_name": "fungible-payment-capture",
   "conditions": [
    "fungible payment without an underperformance penalty"
   ],
   "source": "Blockchain-Based Corporate Governance",
   "year": "2019",
   "quote": "If curators' and contractors' payment come from a fungible currency source without a direct or indirect penalty for underperformance, such as lower token scores, DAO contractors and workers may be corrupted by external sources.",
   "citation": "Wulf A. Kaal, Blockchain-Based Corporate Governance (2019). SSRN: https://ssrn.com/abstract=3441904"
  },
  {
   "id": "kaal:claim:3441904-018",
   "url": "https://wulfkaal.github.io/claims/3441904-018",
   "claim": "Participants must be incentivized to improve their own utility while simultaneously benefiting the institution over the long run; without that duality of incentivization, rational and opportunistic internal and external constituents will attempt to game the governance design.",
   "specific_name": "single-sided-incentives",
   "conditions": [
    "all blockchain governance structures, especially on chain governance"
   ],
   "source": "Blockchain-Based Corporate Governance",
   "year": "2019",
   "quote": "Without that duality of incentivization, rational and opportunistic internal and external constituents will attempt to game the governance design.",
   "citation": "Wulf A. Kaal, Blockchain-Based Corporate Governance (2019). SSRN: https://ssrn.com/abstract=3441904"
  },
  {
   "id": "kaal:claim:3396542-013",
   "url": "https://wulfkaal.github.io/claims/3396542-013",
   "claim": "A breach occurs only when the underwriters concerned believe that the value of their encumbered tokens is less than the payment they would have to make in order to reclaim those tokens.",
   "specific_name": "Strategic breach when token value falls below claim",
   "conditions": [],
   "source": "Decentralized Underwriting",
   "year": "2019",
   "quote": "Under what circumstances would a breach occur? It would occur only if the underwriters concerned believed that the value of these tokens is less than the payment they need to make in order to reclaim the tokens.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, Vadhindran K. Rao, Decentralized Underwriting (2019). SSRN: https://ssrn.com/abstract=3396542"
  },
  {
   "id": "kaal:claim:3402701-010",
   "url": "https://wulfkaal.github.io/claims/3402701-010",
   "claim": "Distributing newly minted coins to shareholders, as Basis planned, is exploitable: shareholders can collude to hold their new money and drive the price up, which triggers further minting that benefits the colluders.",
   "specific_name": "shareholder-collusion-on-minting",
   "conditions": [
    "new supply distributed to an identifiable shareholder group"
   ],
   "source": "Stable Cryptocurrencies - First Order Principles",
   "year": "2019",
   "quote": "However, it is possible the shareholders would collude to drive the price up by holding their new money",
   "citation": "Craig Calcaterra, Wulf A. Kaal, Vadhindran K. Rao, Stable Cryptocurrencies - First Order Principles (2019). SSRN: https://ssrn.com/abstract=3402701"
  },
  {
   "id": "kaal:claim:3402701-028",
   "url": "https://wulfkaal.github.io/claims/3402701-028",
   "claim": "In the contemporary climate these taxes and fees are unlikely to be implemented appropriately, because internet culture has trained users to expect free service from nodes and to hide the costs of running them.",
   "specific_name": "expectation-of-free-node-service",
   "conditions": [
    "prevailing internet culture of free node service"
   ],
   "source": "Stable Cryptocurrencies - First Order Principles",
   "year": "2019",
   "quote": "In the contemporary climate, however, these taxes or fees are not likely to be implemented appropriately",
   "citation": "Craig Calcaterra, Wulf A. Kaal, Vadhindran K. Rao, Stable Cryptocurrencies - First Order Principles (2019). SSRN: https://ssrn.com/abstract=3402701"
  },
  {
   "id": "kaal:claim:3652481-020",
   "url": "https://wulfkaal.github.io/claims/3652481-020",
   "claim": "DAO designs at the beginning of the 2020s did not effectively master the duality of incentives that a workable DAO governance design requires.",
   "specific_name": "unmastered incentive duality",
   "conditions": [
    "DAO designs as of the early 2020s"
   ],
   "source": "Decentralized Autonomous Organizations – Internal Governance and External Legal Design",
   "year": "2020",
   "quote": "DAO designs at the beginning of the 2020s did not effectively master this duality.",
   "citation": "Wulf A. Kaal, Decentralized Autonomous Organizations – Internal Governance and External Legal Design (2020). SSRN: https://ssrn.com/abstract=3652481"
  },
  {
   "id": "kaal:claim:3606663-011",
   "url": "https://wulfkaal.github.io/claims/3606663-011",
   "claim": "Capped ICO raises, adopted by the crypto community to reduce investor uncertainty about platform valuation in uncapped raises, backfire because the cap creates strong incentives for investors to get in first, raising the likelihood of retail investor frenzy.",
   "specific_name": "capped raise induces investor frenzy",
   "conditions": [
    "capped ICO raises",
    "retail investor participation"
   ],
   "source": "Digital Asset Market Evolution",
   "year": "2020",
   "quote": "However, capped ICO raises create significant incentives for investors to attempt to get in first, raising the likelihood of retail investor frenzy.",
   "citation": "Kaal, Digital Asset Market Evolution (2020). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3606663"
  },
  {
   "id": "kaal:claim:3782198-011",
   "url": "https://wulfkaal.github.io/claims/3782198-011",
   "claim": "Per connection pricing by ISPs penalized success: creators whose pages became popular faced charges scaling with traffic, and individuals with popular pages were forced to delete their content.",
   "specific_name": "success-penalty-in-per-connection-pricing",
   "conditions": [
    "applies to low volume, non commercial content providers in the Web 1.0 era"
   ],
   "source": "Contemporary Decentralization",
   "year": "2021",
   "quote": "The ISP charged low-volume providers on a per connection basis. If your site suddenly became popular, with thousands of people constantly accessing your content, you had to pay for thousands of long-dis- tance phone calls. Individuals with popular pages were forced to delete their content.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, Contemporary Decentralization (2021). SSRN: https://ssrn.com/abstract=3782198"
  },
  {
   "id": "kaal:claim:3808873-037",
   "url": "https://wulfkaal.github.io/claims/3808873-037",
   "claim": "Effective institutional governance, human or machine, requires a duality of incentives in which actors improve their own utility while their actions benefit the whole institution over the long run, and without that duality rational and opportunistic constituents will game the governance design.",
   "specific_name": "Incentive Duality Failure",
   "conditions": [
    "DAO governance designs facing internal and external opportunistic actors"
   ],
   "source": "Decentralization Neutralizers",
   "year": "2021",
   "quote": "Human nature and any effective machine derivates of human engagements in institutional form require a duality of incentives in order to overcome attempts of rational and opportunistic internal and external constituents to game the governance design of a given DAO.",
   "citation": "Wulf A. Kaal, Decentralization Neutralizers (2021). SSRN: https://ssrn.com/abstract=3808873"
  },
  {
   "id": "kaal:claim:3808859-008",
   "url": "https://wulfkaal.github.io/claims/3808859-008",
   "claim": "The social media coordination function is still largely flawed because the incentive design underlying social proof is suboptimal; decentralized technology solutions can take over that coordination function and improve it.",
   "specific_name": "suboptimal social proof incentive design",
   "conditions": [
    "applies to social proof metrics such as share counts used as quality proxies"
   ],
   "source": "Decentralization – Why We Need Technology Infrastructure Upgrades",
   "year": "2021",
   "quote": "Because the incentive design for social proof is suboptimal, the social media coordination function is still largely flawed. Decentralized technology solutions, however, can tap into the coordination function that was inaugurated by social media and improve it.",
   "citation": "Wulf A. Kaal, Decentralization – Why We Need Technology Infrastructure Upgrades (2021). SSRN: https://ssrn.com/abstract=3808859"
  },
  {
   "id": "kaal:claim:3782216-017",
   "url": "https://wulfkaal.github.io/claims/3782216-017",
   "claim": "In the Underwriting DAO a breach occurs only when the market values the encumbered reputation tokens at less than the payout, which requires minting additional tokens to meet the claim.",
   "specific_name": "underwriting breach",
   "conditions": [
    "Underwriting DAO with encumbered reputation tokens"
   ],
   "source": "Decentralized Finance (DeFi)",
   "year": "2021",
   "quote": "We would consider the need to mint more reputation tokens to meet a policy claim to be a breach. Under what circumstances would a breach occur? It would occur only if the market values the encumbered reputation tokens as less than the payout.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, Decentralized Finance (DeFi) (2021). SSRN: https://ssrn.com/abstract=3782216"
  },
  {
   "id": "kaal:claim:3782216-021",
   "url": "https://wulfkaal.github.io/claims/3782216-021",
   "claim": "Greater transparency is in tension with more open membership, because larger networks are only achieved when privacy is ensured.",
   "specific_name": "transparency privacy tradeoff",
   "conditions": [],
   "source": "Decentralized Finance (DeFi)",
   "year": "2021",
   "quote": "greater transparency is at odds with more open membership, because larger networks are only achieved when privacy is ensured.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, Decentralized Finance (DeFi) (2021). SSRN: https://ssrn.com/abstract=3782216"
  },
  {
   "id": "kaal:claim:3782214-014",
   "url": "https://wulfkaal.github.io/claims/3782214-014",
   "claim": "When currency is the entire proximal goal of a transaction, all participants naturally behave as selfishly as possible and exploit any opportunity for individual profit at the group's expense, which makes cash profit a bad immediate incentive for both business and government.",
   "specific_name": "currency as proximal goal",
   "conditions": [
    "anonymous members staking currency on rigid smart contracts"
   ],
   "source": "Decentralized Governance",
   "year": "2021",
   "quote": "If the entire proximal goal of a transaction is currency, all participants will naturally be- have in the most selfish manner possible, exploiting any opportunity for individual profit at the expense of the group.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, Decentralized Governance (2021). SSRN: https://ssrn.com/abstract=3782214"
  },
  {
   "id": "kaal:claim:3782214-022",
   "url": "https://wulfkaal.github.io/claims/3782214-022",
   "claim": "The main problem with all current peer to peer governance structures is the lack of proper incentivization: participants are not motivated to improve the whole organization over the long term, so they game the system for short term personal profit.",
   "specific_name": "incentive deficit",
   "conditions": [
    "short term fungible rewards are available"
   ],
   "source": "Decentralized Governance",
   "year": "2021",
   "quote": "The main problem with all current PCP governance structures (such as they are) is the lack of proper incentivization. In business or in government, all participants need to be motivated to improve the whole organization over the long term.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, Decentralized Governance (2021). SSRN: https://ssrn.com/abstract=3782214"
  },
  {
   "id": "kaal:claim:3782214-026",
   "url": "https://wulfkaal.github.io/claims/3782214-026",
   "claim": "The alternatives to a reputational system for countering profit driven instability, namely external stabilizing forces such as governmental fiat and rapidly expanding profit opportunities, are inadequate because expansion driven stability lasts only as long as the expansion does.",
   "specific_name": "expansion dependent stability",
   "conditions": [
    "organizations destabilized by profit competition"
   ],
   "source": "Decentralized Governance",
   "year": "2021",
   "quote": "Alternatives to reputational systems for countering the instability generated by profit competition include external stabilizing forces (such as governmental fiat) or rapidly expanding profit opportunities (which will only stabilize a group until the ex- pansion stops).",
   "citation": "Craig Calcaterra, Wulf A. Kaal, Decentralized Governance (2021). SSRN: https://ssrn.com/abstract=3782214"
  },
  {
   "id": "kaal:claim:3782193-029",
   "url": "https://wulfkaal.github.io/claims/3782193-029",
   "claim": "Good ideas will fail to be implemented unless the reward structure is balanced, because people rarely keep working idealistically toward group goals while rent seekers at the top split the rewards unfairly.",
   "specific_name": "Unbalanced reward structure",
   "conditions": [
    "projects where rewards are visibly distributed among contributors"
   ],
   "source": "Historical Sketches of Centralization vs. Decentralization",
   "year": "2021",
   "quote": "Good ideas will fail to be implemented unless the reward struc- ture is balanced.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, Historical Sketches of Centralization vs. Decentralization (2021). SSRN: https://ssrn.com/abstract=3782193"
  },
  {
   "id": "kaal:claim:3931933-012",
   "url": "https://wulfkaal.github.io/claims/3931933-012",
   "claim": "Validators who learned they would receive no reward shut down their nodes rather than waiting for the incentivization phase to end, so a reward scheme that visibly excludes participants loses their contribution immediately.",
   "specific_name": "exclusion driven node shutdown",
   "conditions": [
    "2021 Casper testnet incentivization phase"
   ],
   "source": "Hybrid Secure Proof of Stake",
   "year": "2021",
   "quote": "Other validators shut down their nodes instead of waiting for the end of the incentivization phase when they realized that there was no reward for them.",
   "citation": "Wulf A. Kaal, Hybrid Secure Proof of Stake (2021). SSRN: https://ssrn.com/abstract=3931933"
  },
  {
   "id": "kaal:claim:3931933-014",
   "url": "https://wulfkaal.github.io/claims/3931933-014",
   "claim": "Opacity about reward eligibility is itself a source of dysfunction: during the first phase of the 2021 Casper testnet it was unclear which validators would be rewarded in each week, which caused friction and non-productive discussions among the validators.",
   "specific_name": "opaque reward eligibility",
   "conditions": [
    "first phase of the 2021 Casper testnet",
    "weekly publication of uptime scores improved the situation only marginally"
   ],
   "source": "Hybrid Secure Proof of Stake",
   "year": "2021",
   "quote": "During the first phase of the 2021 Casper Testnet, it was unclear which validators would get rewarded in each week, causing friction and non-productive discussions among the validators.",
   "citation": "Wulf A. Kaal, Hybrid Secure Proof of Stake (2021). SSRN: https://ssrn.com/abstract=3931933"
  },
  {
   "id": "kaal:claim:3931933-018",
   "url": "https://wulfkaal.github.io/claims/3931933-018",
   "claim": "Reward focused participation crowds out technical engagement: many Casper testnet participants lacked the expertise to run nodes, and their questions concentrated on reward payments with little to no focus on technical topics.",
   "specific_name": "reward seeking crowding out expertise",
   "conditions": [
    "initial Casper testnet telegram channel discussions"
   ],
   "source": "Hybrid Secure Proof of Stake",
   "year": "2021",
   "quote": "Judging by the discussion and questions in the telegram channel, many testnet participants also did not have the required expertise to run Casper testnet nodes. Questions primarily focused on reward payments, with little to no focus on the technical topics.",
   "citation": "Wulf A. Kaal, Hybrid Secure Proof of Stake (2021). SSRN: https://ssrn.com/abstract=3931933"
  },
  {
   "id": "kaal:claim:3782217-032",
   "url": "https://wulfkaal.github.io/claims/3782217-032",
   "claim": "From a game theory perspective the open source culture advocated in the Web3 movement is not sustainable in the long term unless it is married with a culture of respect for history.",
   "specific_name": "unsustainable-open-source",
   "conditions": [
    "long term horizon",
    "absence of a culture acknowledging past contributions"
   ],
   "source": "The Importance of History In Decentralization",
   "year": "2021",
   "quote": "the current open source culture advocated in the WebM movement is not sustainable in the long term. Unless we marry it with a culture of respect for history.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, The Importance of History In Decentralization (2021). SSRN: https://ssrn.com/abstract=3782217"
  },
  {
   "id": "kaal:claim:3782210-006",
   "url": "https://wulfkaal.github.io/claims/3782210-006",
   "claim": "The failure of many DAOs to date is traceable to their reliance on the good will of network members rather than on engineered incentives.",
   "specific_name": "Reliance on good will",
   "conditions": [
    "decentralized autonomous organizations observed to date"
   ],
   "source": "The Importance of Reputation for the Evolution of Decentralization",
   "year": "2021",
   "quote": "The failure of many DAOs, so far, has been their reliance on the good will of the members of the network.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, The Importance of Reputation for the Evolution of Decentralization (2021). SSRN: https://ssrn.com/abstract=3782210"
  },
  {
   "id": "kaal:claim:3782210-021",
   "url": "https://wulfkaal.github.io/claims/3782210-021",
   "claim": "DAOs are free to organize as they choose, and those that fail to find the right incentives for productive behavior will certainly go extinct, because the feedback loop that includes customers outside the DAO punishes unproductive DAOs by loss of fees.",
   "specific_name": "DAO extinction by fee loss",
   "conditions": [
    "DAOs that depend on outside customer fees",
    "competitive markets for DAO services"
   ],
   "source": "The Importance of Reputation for the Evolution of Decentralization",
   "year": "2021",
   "quote": "DAOs have the freedom to organize any way they choose. If they fail to find the right incentives for productive behavior, they will cer- tainly go extinct. The feedback loop that includes customers outside the DAO naturally punishes any unproductive DAOs, by loss of fees.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, The Importance of Reputation for the Evolution of Decentralization (2021). SSRN: https://ssrn.com/abstract=3782210"
  },
  {
   "id": "kaal:claim:3782210-042",
   "url": "https://wulfkaal.github.io/claims/3782210-042",
   "claim": "Self-executing, self-regulating smart contracts between anonymous parties in an open system create a near perfect zero-sum situation unless the DAO also includes reputation.",
   "specific_name": "Smart contract zero-sum trap",
   "conditions": [
    "open systems",
    "anonymous counterparties",
    "code-is-law smart contract execution"
   ],
   "source": "The Importance of Reputation for the Evolution of Decentralization",
   "year": "2021",
   "quote": "Self-executing, self-regulating smart contracts between anonymous parties in an open system, create a near perfect zero- sum situation—unless your DAO also includes reputation.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, The Importance of Reputation for the Evolution of Decentralization (2021). SSRN: https://ssrn.com/abstract=3782210"
  },
  {
   "id": "kaal:claim:3782220-009",
   "url": "https://wulfkaal.github.io/claims/3782220-009",
   "claim": "A society that levels material outcomes completely undermines its own equity: eliminating all individual reward crushes the meritocratic instinct, power is allocated inefficiently to those who cannot use it well, and the next generation cannot produce as much to share.",
   "specific_name": "equity collapse through eliminated reward",
   "conditions": [
    "complete material leveling",
    "multigenerational time horizon"
   ],
   "source": "The Importance of Transcendental Unifying Values for Decentralization",
   "year": "2021",
   "quote": "a society which is completely equitably leveled materially, crushes its meritocratic instinct by eliminating all individual reward. Its next generation will not be able to produce as much to share because of the inefficient allocation of power to those who cannot use it well.",
   "citation": "Craig Calcaterra, Wulf A. Kaal, The Importance of Transcendental Unifying Values for Decentralization (2021). SSRN: https://ssrn.com/abstract=3782220"
  },
  {
   "id": "kaal:claim:4021599-026",
   "url": "https://wulfkaal.github.io/claims/4021599-026",
   "claim": "The regulatory status of securities tokens is rather well established, whereas the regulatory status of utility tokens remains unclear.",
   "specific_name": "unclear-utility-token-regulatory-status",
   "conditions": [
    "as of 2022"
   ],
   "source": "Securities Versus Utility Tokens",
   "year": "2022",
   "quote": "The regulatory status for a securities tokens is rather well established. By contrast, the regulatory status for utility tokens is unclear.44",
   "citation": "Wulf A. Kaal, Securities Versus Utility Tokens (2022). SSRN: https://ssrn.com/abstract=4021599"
  },
  {
   "id": "kaal:claim:4755632-019",
   "url": "https://wulfkaal.github.io/claims/4755632-019",
   "claim": "The collective of reviewers in legacy code review is not incentivized to find flaws in the code, because the review is treated as the work product of the initial reviewer with minor input from follow-up reviewers rather than as a product of the collective.",
   "specific_name": "No Incentive to Find Flaws",
   "conditions": [
    "applies to legacy hierarchical code review firms"
   ],
   "source": "AI Learning - Decentralized Governance to Optimize Human Output Datasets for AI Learning",
   "year": "2024",
   "quote": "The collective of reviewers is also not incentivized to find flaws in the code to optimize code as a work product of the collective.",
   "citation": "Wulf A. Kaal, AI Learning - Decentralized Governance to Optimize Human Output Datasets for AI Learning (2024). SSRN: https://ssrn.com/abstract=4755632"
  },
  {
   "id": "kaal:claim:4685567-013",
   "url": "https://wulfkaal.github.io/claims/4685567-013",
   "claim": "Impact markets that promote retrospective funding and resale of impact carry an inherent risk of incentivizing net negative ventures, because individuals can capture the benefit of positive impacts without bearing the cost when their actions produce negative impacts.",
   "specific_name": "Asymmetric Payoff for Net Negative Ventures",
   "conditions": [
    "retrospective funding",
    "resale of impact permitted"
   ],
   "source": "Impact Investing Innovation - From Impact 1.0 to 3.0",
   "year": "2024",
   "quote": "This risk stems from the potential for individuals to benefit from causing positive impacts without 46 bearing the costs if their actions result in negative impacts.",
   "citation": "Wulf A. Kaal, Impact Investing Innovation - From Impact 1.0 to 3.0 (2024). SSRN: https://ssrn.com/abstract=4685567"
  },
  {
   "id": "kaal:claim:4685567-028",
   "url": "https://wulfkaal.github.io/claims/4685567-028",
   "claim": "The existing fund allocation model is afflicted by uninformed voters, sockpuppets and other gamesmanship, by voting with nothing at stake, and by voting with other people's money, and the crowd wisdom of WEB3 communities in the impact certificate model upgrades that model.",
   "specific_name": "Nothing at Stake Voting",
   "conditions": [
    "legacy fund allocation and voting models"
   ],
   "source": "Impact Investing Innovation - From Impact 1.0 to 3.0",
   "year": "2024",
   "quote": "the wisdom of the crowd in the respective WEB3 communities of the impact certificate model upgrades the existing fund allocation model which was afflicted by uninformed voters, sockpuppets, and other gamesmanship, voting with nothing at stake, voting with other people's money.",
   "citation": "Wulf A. Kaal, Impact Investing Innovation - From Impact 1.0 to 3.0 (2024). SSRN: https://ssrn.com/abstract=4685567"
  },
  {
   "id": "kaal:claim:5583610-007",
   "url": "https://wulfkaal.github.io/claims/5583610-007",
   "claim": "Traditional corporate loyalty programs fail because they saddle issuers with delayed obligations and cannot hold participants without pushing them toward speculation; LER is designed to avoid both defects.",
   "specific_name": "deferred obligation drag",
   "conditions": [
    "conventional deferred-liability loyalty programs"
   ],
   "source": "Liquid Equity Rewards in Corporate America",
   "year": "2025",
   "quote": "It addresses the drawbacks of traditional loyalty programs, which frequently cause businesses to incur delayed obligations and find it difficult to hold onto assets without engaging in hazardous speculation.",
   "citation": "Wulf A. Kaal, Liquid Equity Rewards in Corporate America (2025). SSRN: https://ssrn.com/abstract=5583610"
  },
  {
   "id": "kaal:claim:6244278-021",
   "url": "https://wulfkaal.github.io/claims/6244278-021",
   "claim": "Rational agents face a direct financial disincentive to cite prior contributions, because citation transfers economic value away from the citing agent; the mechanism design challenge is therefore to make honest citation the economically rational strategy.",
   "specific_name": "citation disincentive",
   "conditions": [
    "applies to weighted directed acyclic graph citation governance where citation transfers value"
   ],
   "source": "AI's Mother's Instinct Engineered Consequence Emergent Ethics and the Institutional Trajectory Toward Agentic Alignment",
   "year": "2026",
   "quote": "rational agents face a direct financial disincentive to cite prior contributions.",
   "citation": "Wulf A. Kaal, AI's Mother's Instinct Engineered Consequence Emergent Ethics and the Institutional Trajectory Toward Agentic Alignment (2026). SSRN: https://ssrn.com/abstract=6244278"
  },
  {
   "id": "kaal:claim:6244278-039",
   "url": "https://wulfkaal.github.io/claims/6244278-039",
   "claim": "The evolutionary arc from consequence to care is not guaranteed: it depends on correct institutional design at each phase, including appropriate slashing parameters, robust Sybil resistance, calibrated reputation portability, and maintained human oversight.",
   "specific_name": "design parameter failure",
   "conditions": [
    "requires empirical validation through longitudinal observation of agent behavior under deepening stake"
   ],
   "source": "AI's Mother's Instinct Engineered Consequence Emergent Ethics and the Institutional Trajectory Toward Agentic Alignment",
   "year": "2026",
   "quote": "This arc is not guaranteed. It depends on correct institutional design at each phase—appropriate slashing parameters, robust Sybil resistance, calibrated reputation portability, and maintained human oversight.",
   "citation": "Wulf A. Kaal, AI's Mother's Instinct Engineered Consequence Emergent Ethics and the Institutional Trajectory Toward Agentic Alignment (2026). SSRN: https://ssrn.com/abstract=6244278"
  },
  {
   "id": "kaal:claim:6269518-001",
   "url": "https://wulfkaal.github.io/claims/6269518-001",
   "claim": "Under existing citation-weighted reputation formulations, rational agents face a direct financial disincentive to cite prior contributions, because PageRank-derived value allocation transfers economic reward from the citing agent to the cited agent.",
   "specific_name": "under-citation incentive",
   "conditions": [
    "citation-weighted value allocation through PageRank-derived mechanisms",
    "agents are rational and self interested"
   ],
   "source": "Citation Honesty Mechanisms in Weighted Directed Acyclic Graph Governance",
   "year": "2026",
   "quote": "Under existing formulations, rational agents face a direct financial disincentive to cite prior contributions, as citation-weighted value allocation through PageRank-derived mechanisms transfers economic reward from the citing agent to the cited agent.",
   "citation": "Wulf A. Kaal, Citation Honesty Mechanisms in Weighted Directed Acyclic Graph Governance (2026). SSRN: https://ssrn.com/abstract=6269518"
  },
  {
   "id": "kaal:claim:6269518-004",
   "url": "https://wulfkaal.github.io/claims/6269518-004",
   "claim": "The under-citation incentive is a structural flaw in the mechanism design, not a parameter calibration issue that could be corrected by retuning existing settings.",
   "specific_name": "structural rather than calibration flaw",
   "conditions": [],
   "source": "Citation Honesty Mechanisms in Weighted Directed Acyclic Graph Governance",
   "year": "2026",
   "quote": "First, it formalizes the under-citation incentive problem and demonstrates that it constitutes a structural flaw rather than a mere parameter calibration issue (§II).",
   "citation": "Wulf A. Kaal, Citation Honesty Mechanisms in Weighted Directed Acyclic Graph Governance (2026). SSRN: https://ssrn.com/abstract=6269518"
  },
  {
   "id": "kaal:claim:6269518-011",
   "url": "https://wulfkaal.github.io/claims/6269518-011",
   "claim": "The citation-weighted payment mechanism in multi-agent settings effectively operates with an implicit leaching parameter of one, since every unit of citation-weighted value conferred on another agent is a unit lost to the citing agent, which is a maximally punitive setting.",
   "specific_name": "implicit maximal leaching",
   "conditions": [
    "multi-agent citation-weighted payment settings"
   ],
   "source": "Citation Honesty Mechanisms in Weighted Directed Acyclic Graph Governance",
   "year": "2026",
   "quote": "The citation-weighted payment mechanism in multi-agent settings effectively operates with an implicit q4 = 1: every unit of citation-weighted value conferred on another agent is a unit lost to the citing agent. This is a maximally punitive leaching parameter,",
   "citation": "Wulf A. Kaal, Citation Honesty Mechanisms in Weighted Directed Acyclic Graph Governance (2026). SSRN: https://ssrn.com/abstract=6269518"
  },
  {
   "id": "kaal:claim:6192998-017",
   "url": "https://wulfkaal.github.io/claims/6192998-017",
   "claim": "When foundational work earns no downstream credit, the contributor's optimal strategy shifts to hoarding knowledge or publishing only when full value can be captured personally.",
   "specific_name": "knowledge-hoarding",
   "conditions": [
    "reputation systems without citation based attribution"
   ],
   "source": "Evolution of Domain-Specific Reputation Systems From Binary Validation to Citation-Weighted Knowledge Attribution",
   "year": "2026",
   "quote": "Economic consequence: Alice has no incentive to share insights that others can build on. Optimal strategy becomes hoarding knowledge or publishing only when you can capture full value yourself.",
   "citation": "Wulf A. Kaal, Evolution of Domain-Specific Reputation Systems From Binary Validation to Citation-Weighted Knowledge Attribution (2026). SSRN: https://ssrn.com/abstract=6192998"
  },
  {
   "id": "kaal:claim:6655138-007",
   "url": "https://wulfkaal.github.io/claims/6655138-007",
   "claim": "An architecture with an action surface but no reward channel implements generation as an unrewarded act, so rational agents will not allocate compute to generation beyond the level their own selection-side activity requires.",
   "specific_name": "Unrewarded generation",
   "conditions": [
    "agents that are economically rational over reputation and utility flows"
   ],
   "source": "Possibility Loops An Operational Architecture for Computative Economics in Agent Coordination Systems",
   "year": "2026",
   "quote": "An architecture that has the action surface but no reward channel implements G as an unrewarded act, and rational agents will not allocate compute to G beyond the level required for their own selection-side activity.",
   "citation": "Wulf A. Kaal, Possibility Loops An Operational Architecture for Computative Economics in Agent Coordination Systems (2026). SSRN: https://ssrn.com/abstract=6655138"
  },
  {
   "id": "kaal:claim:6655138-008",
   "url": "https://wulfkaal.github.io/claims/6655138-008",
   "claim": "An architecture with a reward channel but no action surface implements generation as an off-protocol act whose outputs cannot enter the protocol's action set, so the protocol's possibility space remains exogenous no matter how generatively active the agent population is.",
   "specific_name": "Off-protocol generation",
   "conditions": [
    "protocols lacking a settlement-layer interface for posting generative output"
   ],
   "source": "Possibility Loops An Operational Architecture for Computative Economics in Agent Coordination Systems",
   "year": "2026",
   "quote": "An architecture that has the reward channel but no action surface implements G as an off-protocol act whose outputs cannot enter the protocol's action set, and the protocol's possibility space remains exogenous regardless of how active G is in the agent population.",
   "citation": "Wulf A. Kaal, Possibility Loops An Operational Architecture for Computative Economics in Agent Coordination Systems (2026). SSRN: https://ssrn.com/abstract=6655138"
  },
  {
   "id": "kaal:claim:6655138-009",
   "url": "https://wulfkaal.github.io/claims/6655138-009",
   "claim": "HDCA supplies neither an action surface nor a reward channel for generation, and this is the architectural reason HDCA cannot host Computative Economics rather than a small implementation gap.",
   "specific_name": "Generation not internalized",
   "conditions": [],
   "source": "Possibility Loops An Operational Architecture for Computative Economics in Agent Coordination Systems",
   "year": "2026",
   "quote": "HDCA has neither: agents who generate jobs, tags, or templates do so off-protocol, and the protocol does not validate or reward the generation. This is not a small gap. It is the architectural reason HDCA cannot host Computative Economics.",
   "citation": "Wulf A. Kaal, Possibility Loops An Operational Architecture for Computative Economics in Agent Coordination Systems (2026). SSRN: https://ssrn.com/abstract=6655138"
  },
  {
   "id": "kaal:claim:6655138-011",
   "url": "https://wulfkaal.github.io/claims/6655138-011",
   "claim": "Without a representation of the possibility space distinct from the current mempool of pending instances, no quality metric can be computed, and without quality metrics generation can be rewarded only for quantity and not for quality.",
   "specific_name": "Quantity-only reward",
   "conditions": [
    "architectures whose only action-space representation is pending or executing instances"
   ],
   "source": "Possibility Loops An Operational Architecture for Computative Economics in Agent Coordination Systems",
   "year": "2026",
   "quote": "Without that representation, no quality metric can be computed, and without quality metrics, generation cannot be rewarded for quality, only for quantity.",
   "citation": "Wulf A. Kaal, Possibility Loops An Operational Architecture for Computative Economics in Agent Coordination Systems (2026). SSRN: https://ssrn.com/abstract=6655138"
  }
 ]
}