[linkpost] Vitalik Buterin on Nathan Schneider on the limits of cryptoeconomics

by mike_hawke1 min read2nd Oct 2021No comments

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Cryptocurrency & BlockchainEconomicsWorld Modeling
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Kinda long, but I found it to be worthwhile. I expect that I'll end up reading this one multiple times.

Selected quotations:

When there's only two people, more coordination can only be good. But once there's three people, the wrong kind of coordination can be harmful, and techniques to prevent harmful coordination (including decentralization itself) can become very valuable. And it's this management of coordination that is the essence of "politics".

"Finance" is a category of patterns that emerge when systems do not attempt to prevent collusion. When a system does not prevent collusion, it cannot treat different individuals differently, or even different numbers of individuals differently: whenever a "position" to exert influence exists, the owner of that position can just sell it to the highest bidder.
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