failure family
transition and migration risk
- cost and uncertainty of principles based transition: The downsides of principles based regulation are a costly and time consuming transition from rules based regulation, uncertainty, and compliance probl
- hybrid-coding-obsolescence: The benefits of coding existing law into smart contracts are only temporary, because as smart contracting evolves over time fewer smart contracting so
- displacement-of-existing-legal-services: The decentralization of law pursued by Legal Tech startups has broad repercussions for the legal profession, the first of which is that existing legal
- ipo-termination-of-shareholder-agreement: A shareholder agreement authorized under MBCA Section 7.32 ceases to be effective once the corporation's stock is listed on a national securities exch
- Legacy integration cost: Adoption of blockchain is costly and technically difficult because the technology is continually evolving and integrating blockchain databases with ex
- isolated-infrastructure-reform: The complex systems that decentralized infrastructure technology will reform are interdependent, so development of the infrastructure elements alone i
- loss of the settlement grace period: Instant settlement destroys an existing business practice: without the T+3 grace period, institutional investors can no longer lend idle shares to inv
- obsolete-payment-infrastructure: Central bank operated wholesale payment systems are at the end of their technological life cycle, running on largely obsolete database designs and com
- resilience versus cost and privacy tradeoff in wholesale DLT settlement: The Bank of Canada's year long Jasper trial revealed a tradeoff rather than a solution: Ethereum would make the wholesale payment system more resilien
- Hardfork Upgrade Cost: Decentralized networks depend on dynamic governance because evolving blockchain protocols require updates, and the practice of hardforking that remain
- VC competitive displacement by token offerings: Traditional VCs often cannot effectively compete with the ever increasing array of decentralized token offering avenues.
- abrupt-consensus-transition-destabilization: An abrupt transition from Proof of Stake to Secure Proof of Stake would destabilize networks built on stake-based incentives, because stake is a fungi
- validator-infrastructure-obsolescence: A direct move from PoS to SPoS would render existing validator communities and stake-optimized infrastructures obsolete or force significant reconfigu
- Compounding Institutional Dissolution: The three dissolution mechanisms compound: marginal cost collapse undermines price signals, transformed asymmetry relocates the binding informational
- Business Model Incoherence: Newspapers, record labels, broadcast networks, and publishing houses did not merely lose market share under zero marginal cost distribution; their fou