failure family

smart contract rigidity

34 claims across 18 works.

• no-breach-no-remedy: Breach of a smart contract is arguably not even possible, because the contract simply will not execute if a parameter is not fulfilled.
• immutability-blocks-remedies: To institute traditional remedies where a smart contract transaction disadvantages one of the parties, courts would have to change the blockchain, and
• inevitable-smart-contract-imperfection: Problems with smart contracts are inevitable because of subjectivity in human relationships, bounded rationality of coders and contracting parties, in
• asymmetric encumbrance abuse: Parties to a smart contract must avoid asymmetric encumbrance of assets, because in an anonymous blockchain environment where assets cannot be recover
• rigidity of smart contract logic: Smart contracts cannot by themselves carry human business interactions, because those interactions require flexibility in interpreting intent that is
• minimum performance degeneration: A pure code is law smart contract between anonymous parties creates a zero sum scenario in which each party is incentivized to deliver only the minimu
• missing-default-rules: Unlike corporate governance systems, the decentralized nexus of incomplete smart contracts has no supply of majoritarian default rules to fill its gap
• no-real-time-governance-upgrade: The core governance failure of the original 2016 DAO was its inability to create dynamic governance protocol upgrades in real time through dynamic fee
• backstop-absent-guarantee-failure: Without a decentralized human backstop to code, the immutability of the blockchain and its cryptographic security systems may not be able to create tr
• rigidity-of-mathematical-logic: Smart contracts fail to accommodate human business interaction because code does not follow the same logic on similar terms as natural human language,
• cancel-out-on-unanticipated-events: Smart contracts undermine the parties' ability to continue collaborating when unanticipated eventualities arise, because in most cases of unfulfilled
• rigidity-of-mathematical-logic: Human business interactions require a flexibility that is at odds with the merciless mathematical logic of smart contracts, so smart contracting canno
• cancel-out-on-unfulfilled-parameters: Smart contracts undermine counterparties' ability to continue collaborating when unanticipated eventualities arise, because in most cases of unfulfill
• rigidity-of-mathematical-logic: Despite their benefits, smart contracts are subject to significant limitations because human business interactions require a flexibility that is at od
• intent-interpretation-gap: Smart contracting cannot ensure the flexibility in interpreting intent that human interaction requires, because smart contract code does not follow th
• cancel-out-on-unanticipated-events: Smart contracts undermine the ability of counterparties to continue collaborating when unanticipated eventualities arise, because in most cases of unf
• no-partial-performance: Human business interaction typically requires the possibility that each party may fulfill only a portion of an intended collaboration, a partial perfo
• transferability-creates-attack-points: The transferability of the stores of value entailed in cryptocurrencies creates core points of attack and undermines the very nature of decentralizati
• ex-ante-incompleteness-of-hardcoded-policy: Full hardcoding is impossible: no stable cryptocurrency can encode all required policies and policy actions with full transparency, because future pol
• limits-of-full-automation: The day-to-day stability mechanism can be fully automated by algorithm, but monetary and fiscal policy choices cannot be: the algorithm's parameters m
• immutability trap: The immutability of blockchain ledgers is itself a vulnerability, because once a DAO is in operation its essential construction is very difficult to a
• non codifiable information is discarded: Because human interactions in business are often too complex to be fully codified objectively, DeFi systems that exclude all non objective information
• unwise-protocol-centralization: Protocol centralization, meaning rigid and immediately enforced rules such as those executed by smart contracts, leads to instability unless it is imp
• code-is-law-absolutism: Despite its alluring simplicity, the Code is Law credo taken as an absolute is not an efficient solution for business, because unintended consequences
• Codeless Human Backstop Gap: A decentralized human backstop to code is a core and often overlooked infrastructure requirement, because without it the immutability of the blockchai
• irreversible self execution: Rigid code is law smart contracts over fungible currency are built to guarantee irreversible, unreviewable, self executing outcomes, which is a poor m
• perfect design fallacy: The engineering assumption that such problems can be entirely avoided through perfect system design is naive: exceptions will always exist because bus
• review delay causing contract obsolescence: Delays in legacy code reviews, which can be exacerbated by digital asset market conditions, can impact development and may require complete rewriting
• Irreversible self execution rigidity: Smart contracts that govern fungible currency exchanges are engineered for irreversible, unreviewable, programmed self execution, and that design make
• Incomplete contracting in code: Code is law fails as a complete business ordering because business ventures very rarely proceed exactly as written in smart contract code: real busine
• Immutability blocks judicial modification: Because blockchain based contracts are immutable, they cannot be altered by judicial order, which creates enforceability problems whenever a dispute a
• Automated self help violates mandatory remedy rules: The adaptability of common law to smart contracts is strained when the coded mechanism itself violates a legal norm, as with smart contracts that enab
• No appeal or mitigation in automated enforcement: Unlike legal systems that balance enforcement against fairness, the binary execution of code offers no mechanism for appeal or mitigation, which limit
• Loophole exploitation under rigid coded terms: The deterministic execution of smart contracts rigidly enforces coded terms and thereby incentivizes participants to exploit loopholes for immediate g