Bitcoin on Nostr: Relational Contracts & Trust Networks via Nostr Though bitcoin operates without a ...
Relational Contracts & Trust Networks via Nostr
Though bitcoin operates without a need for trust, real-world economic activities often still require it. The article explores how Relational Contract theory can establish and quantify trust through Nostr, highlighting that economic transactions can maintain stability without third-party escrow or the threat of violence. The concept is that trust is built through repeated successful exchanges where both parties recognize mutual benefits, leading to stable trading relationships.
- The challenges of relational contracts, such as bootstrapping trust from zero and the costliness of destroying relationships, can be mitigated through strategic interactions and cost signalling.
- The author proposes a sybil-resistant proof-of-trade-history that leverages a voluntary transaction rake to build reputational data, which could shift the preference towards honest cooperation rather than defection.
- Potential for Nostr lies in markets dominated by a few companies that inhibit free interaction, where peer-to-peer transactions via Nostr can lead to substantial market improvements and drive bitcoin adoption as the default currency.
- The author expresses optimism for Nostr's potential to reshape economic systems and ends the article with a personal note on starting an aerospace & defense startup, inviting interested readers to get in touch.
https://heaviside.substack.com/p/nostrato-how-relational-contracts
Though bitcoin operates without a need for trust, real-world economic activities often still require it. The article explores how Relational Contract theory can establish and quantify trust through Nostr, highlighting that economic transactions can maintain stability without third-party escrow or the threat of violence. The concept is that trust is built through repeated successful exchanges where both parties recognize mutual benefits, leading to stable trading relationships.
- The challenges of relational contracts, such as bootstrapping trust from zero and the costliness of destroying relationships, can be mitigated through strategic interactions and cost signalling.
- The author proposes a sybil-resistant proof-of-trade-history that leverages a voluntary transaction rake to build reputational data, which could shift the preference towards honest cooperation rather than defection.
- Potential for Nostr lies in markets dominated by a few companies that inhibit free interaction, where peer-to-peer transactions via Nostr can lead to substantial market improvements and drive bitcoin adoption as the default currency.
- The author expresses optimism for Nostr's potential to reshape economic systems and ends the article with a personal note on starting an aerospace & defense startup, inviting interested readers to get in touch.
https://heaviside.substack.com/p/nostrato-how-relational-contracts