I was recently talking with someone about the difficulties in the administration of smart contracts.
One of the main advantages of smart contracts is that you don't have to trust them.
The smart contract code(if it's visible) will tell you everything you need to know about its functionality.
This is great, we all cry "huzzah!" in joy and call it a day.
Well... almost.
Most real-world utilities for contracts require some sort of administration.
Do you want to create an NFT record of line items from a store?
Simple enough, right? Just add the items to a list, create the NFT & send it to a wallet.
It's perfect! Until, of course, someone wants to return an item to the store or an item was mispriced in the till system.
What do we do then?
You can come up with some complex machinery of moving parts, but how do you organize it?
How do you prevent tampering with multiple NFTs representing a single transaction?
How do you keep it from becoming so brittle that it's unuseable?
With Web3 there is the opportunity for radical transparency, durability and speed of transactions. This alone will change how business is done throughout the world. What it can't change is the need for trust between different parties when transacting (though that will be altered as well).
For example, let's say that a real estate transaction is committed to the blockchain.
Great, you've just bought a brand new tract of land some place you'd like to be.
According to the block chain it's yours.
They have your USDC and you have... well, nothing so far.
Don't worry, though, your resident real estate authority will send you an NFT with the deed to your new land.
Great, sounds good. You'll meet the old owner, and get the keys to the buildings on the land and...
Oh, wait - we have a physical component to this too. Someone will need to transfer the keys to you after the sale.
That means that while the transaction is trustless, you still need human intermediaries to ensure the full exchange is completed.
Oh, but that's a temporary problem. Everything will be digital soon, even the keys to your home.
Alright, let's grant that.
You've made an exchange of digital goods for digital access and ownership of property.
The transaction works perfectly.
But... you didn't use a realtor.
Because you didn't use a realtor, no one verified that the proof of ownership was valid.
Suddenly, you have a worthless NFT and a whole lot less USDC.
You trusted and didn't verify. You didn't go through parties that knew the space & its pitfalls because web 3 is all about direct transactions, right?
Like it or not, as web 3 tech is adopted across more and more platforms hundreds of thousands of people (if not millions) are going to repeatedly make this mistake. We're going to need trusted intermediaries, and even then they'll make mistakes.
Are these limitations of web 3? Or just how we're approaching it so far?
How can we help the mass of people who will join web 3 in the coming years to have a safe and enjoyable experience?
Education is necessary,but it alone is not enough. Most people just want something that works - and soon enough, traditional means of transaction may no longer be available to them.
How can we help prepare the way for those who are skeptical and reluctant to join web 3, and make it a safe place to transact?
Give me your thoughts in the comments. I have a few thoughts that I'll put together in Part 2 over the next few days and I'll post them here.
