Tauchain and the Cost of Trust

in tauchain •  8 months ago

It's Thursday and I'm back, guys.

It's been long time, but here I'm again :)

This post theme was getting ripe in my head for long time. Something like since 2014.

Recently I got some data to put together the stepping stones for turning my mere suspicion into more of a grounded conclusion.

The problem was that it was also growing in width and depth with time, so here you are a momentary snapshot or sketch-map of it, which I intend to elaborate further on.

I'll start with shooting two slogan-missiles which constitute super-compression of lotsa research and which will be revisited soon in separate series of articles.

Trust is Force

  • ''you trust 'em only as much as you can make 'em to...''


Money is Mnemonics

  • yes, precisely THIS is the core essence and function of ANY monetary system - (even the primordial barter one with its naturally emerging special tokens [1], [2] to mitigate its intrinsic exponential wall [3] of unscalabiliuty [4], [5]) - to account or remember human activity. That is, money is always work to prove work. Basically we need to remember due to impossibility of simultaneity of transactions.

Which I already went over [33]... and, I beg your pardon. Three, not two slogans. The third one is:

Law is Between, Code is Within

Will explain later what I mean [6] and how it ties up with the former two. In a nutshell is about the enforceability as essential characteristic of all law and now will just hint that the reason why Force (coercion) is deemed to be fundamentally non-decentralizable is the Pauli exclusion principle [7] which is kinda ''location conservation law'' [8].

You already know [9], [10] my taste for epystemological 'archaeology', that's why I think it is better to carry the story on in chronological order.

Back in 2014 I stumbled upon series of extremely astute and deep thought articles [11], [12], [13], [14], [15] on the cost of several well known monetary systems in comparison with Bitcoin, which just has been grown enough to become visible for unaided eye.

I remember I discovered these great articles by the obviously great Hass McCook in the wake of the MtGox [16], [17] boom and bust aftershock, when huge anxiety about the 'wastefullness' of the Bitcoin mining was reigning the public sentiment. (It happens everytime the price nears the production cost).

The search of mine which hit those was driven by the quite legitimate question of:

''If crypto is wasteful, then how much the traditional fiat costs us, god damn it?''

Well, the comparison turned up, as I suspected, not at all in favor neither of the quite recent demetalized fractalized-centralized double-entry book-keeping debts mnemonincs of the banknotes monetary system, nor in favor of the millennia old 'heavy metal' single-entry money where the physical possession of gold/silver denotes your purchase power...

And it occured it was not at all just about costs of mining, refining, casting, ink, printing press, storage, accounting, counterfaiting countermeasures, ... but the bill to pay includes also all the social infrastructure and capital devoted on the making the system to work, and to be kept ticking ...

Essentially all which is know as ... government. All its buildings, all its sallaried humans, all their guns, pens, pensions, courts, judges and bailiffs ... everything.

All that needed in order a common Ledger to be built, maintained, broadcasted and kept. The difference between government and governance is obvious - the former is the means to an end, the later is the end. The former is the machine, the later is the function.

Here is the place to insert three other quick notions which are in the pipeline for revisiting and furnishing with separate articles.:

Firstly, Mnemonics is subject of big evolutionary/development forces just as anything else into the combinatorial explosion which the universe, nature, society is ...

You noticed above the notion of money emergence kinda coinciding with writing? The Sumerian example.

Writing is mnemonics amplifier [18]. Just like the combustion engines are transportation boosters [19].

The better memory and memory sharing system we have on our disposal the better money we have.

Money is technology [20].

Secondly, any book-keeping - regardless whether we write by hand on cave wall or papyri, or by blade on a wooden stick, or by most sophisticated laser-quantum methods on most sophisticated multi-dimensional crystals [21] - is, yeah, a function of writing. We can go even further and state that illiterate verbal folklore - the only thing we got for millions of years - is form of verbal writing onto each other's short-term/long-term memories, just like photography and sound recording is.

The important thing to note here is that in the light of ''Money is Mnemonics'' spell of mine - the accountancy systems do possess cardinality of entries [22], [23], [24].

And it seems that the mega-trend is:

''the more entries handled = the better our money is''

Fiat one - monetary and overall - is double-entry based and relies upon import of trust, blockchain is tripple-entry and trust is built-in. Blockchain is not 'trustless' but is 'autotrophic' [25] in regards with trust.

The third notion turns us back on track with the main theme of this article. It is that of the mutual entropy [26].

The Ledger, no matter which tech it uses to be, has as purpose to define how the individual people's acivity has to be limited for the sake of collective cooperation and collaboration.

The Ledger - product of the particular kind of Mnemonics in play - literally SHAPES and MAKES the society.

As kinda Sorites [27] or Holon [28] or Mereonomic [29] ... generator.

NOW, which costs more? Which one is more wasteful of all the known Ledger or Mnemonic or Monetary systems known?

Literally couple of days ago I stumbled upon ''The $29 trillion cost of trust'' from 24 Jul 2018 by Sinclair Davidson, Mikayla Novak and Jason Potts [30], which made this long time in the making article to come out.

Now I finally have put my eyes on some numbers to juggle with.
$29 Trills!
The ecumenical [31] or midgardic [32] GDP is evaluated on roughly rounded up ~$100t p.a.
There is lots of well grounded criticism [33] on the ability of the present day fiat financial system to actually manage to encompass and measure it all - but lets take this conditional good round figure for the global GDP.
The total wealth of ~quarter of $Quadrillion (giving total average depriciation / consumption rate of over a third per year).

GDP evaluates the dynamic part. The work.

Almost 1/3rd of all work is devoted to account for or to prove the work!

Visualize the fiat system as a primitive, primordial, predeluvial or perecursor form of PoW [34].

Funny enough this ~1/3rd global proof-of-work or mnemoic or governance cost strangely coincides with the energy budget of the brain [35] as fraction of the total energy a human body dissipates to live.

The last two pieces of research argumentation to close the topic are.:

  • ''Nothing is Cheaper than Proof of Work'' from 04 Aug 2015 by Paul Sztorc [36]


  • ''Bitcoin: A $5.8 Million Valuation Crypto-Currency and A New Era of Human Cooperation'' from 25 Jul 2017 by Mr. Game & Watch [37]

I'm trully impressed by the depth of these two documents. It is as big as - each sentence backed by several book volumes of profound research.

Paul Sztorc convincingly demonstrates that PoW is the most efficient protocol for decentralization or 'trustlessness'. It appears that 'PoW is the cheapest' not only among the blockspace [38] but also cheapest everywhere and everywhen.

Mr. Game and Watch evaluates that if in the present day 100-ish $Trills strong global economy there was nothing but Bitcoin as a form of money - the value of a single BTC would be worth millions of $.

''Banknote waste differs from other types of monetary waste in that it is much harder to perceive, by virtue of the complex nature of banknote creation. In contrast, Bitcoin mining directly consumes electricity, and gold mining obviously requires engineers, machinery, armed guards and so forth. At first glance, it seems incredible that impoverished hunter-gatherers would devote some of their precious time to the manufactureof silly beads and shells and other collectibles. And, it seems wasteful indeed, that we humans use ourpowerful brains primarily to obsess over what other people think of us. All of these activities are wasteful,in a narrow sense, but in a broader sense they maintain the infrastructure required to promote and sustaincooperation. These are social activities – we engage in them because we are not alone.''

Apparently monetary system which involves humans to function is unscalable. In the preTau. It is far easier and unlimited as capacity to grow our electricity and machinery resources, than to replicate humans. [46]

Intuitively, the lower the Cost of Trust the stronger the society, the bigger and with higher acceleration is the growth of the economy, the higher is the affluence and wealth. [18], [39], [40], [41], [19], [42].

If hypothetically the Cost of Trust is zero, the value of the economy will be infinite?

The endogenous automation of production and distribution of trust which the blockchain enables many orders of magntitude lowering of the cost of trust, compared with the present hand-driven system. (As an example - Satoshi himself posited aka 'payment channels' [43] and Lightning Network [44] and such promise hundreds of thousands of times smaller transaction costs all internal to the trusltessness environment of blockchain without to rely upon human work to prove work ...)

At the end, what has Tauchain in common with that all?

Well, lotsa things. I'm light years if not infinitely far from any generalization and systematization, but here you are an improvised list ... of questions :

  • Tau is generalization of all p2p network protocols. It is even generalization of all Taus by the virtues of self-reference and self-definition.

  • Evolution is an algorithm. Very poor one. Now we have it as the only means to blind search the phase space of all possible blockchain decentralization protocols [45]. Human ingenuity amplified by Tau enabled collective super-intelligence increases the chances for discovering and harnessing better than the evolutionary algos, so in more controlled manner to evaluate and implement even lower cost trust-making.

  • What if Cost of Trust is negative? Is this at all possible? So far accountancy, money-mnemonics, book-keeping, proving work, management, governance splits the system into controller and controlled, and the former relies upon the resources of the later. Recording and enforcing are form of work, distinct from the 'actual' 'useful' work. Are proof-as-you-work protocols possible? Where the economy just reflects itself as it goes? Self-proving work? Real systemic self-control? [47]

Please, you continue ...


[1] - https://www.thoughtco.com/clay-tokens-mesopotamian-writing-171673

[2] - http://www.ancientpages.com/2017/07/08/intriguing-sumerian-clay-tokens-ancient-book-keeping-system-used-long-writing-appeared/

[3] - https://arxiv.org/abs/1703.02572

[4] - https://steemit.com/tauchain/@karov/scaling-is-layering

[5] - https://steemit.com/tauchain/@karov/tauchain-transcaling

[6] - http://www.behest.io/ & https://steemit.com/blockchain/@karov/behest-for-tauchain

[7] - https://en.wikipedia.org/wiki/Pauli_exclusion_principle

[8] - https://en.wikipedia.org/wiki/Conservation_law

[9] - https://steemit.com/bitcoin/@karov/bitcoin-retrodictions

[10] - https://steemit.com/blockchain/@karov/geodesic-by-tau

[11] - https://www.coindesk.com/microscope-true-costs-gold-production/

[12] - https://www.coindesk.com/microscope-real-costs-dollar/

[13] - https://www.coindesk.com/microscope-true-costs-banking/

[14] - https://www.coindesk.com/microscope-economic-environmental-costs-bitcoin-mining/

[15] - https://thebitcoin.pub/t/under-the-microscope-conclusions-on-the-costs-of-bitcoin/44457

[16] - https://en.wikipedia.org/wiki/Mt._Gox

[17] - https://oracletimes.com/mt-gox-bitcoin-whale-trustee-seized-selling-bitcoin-btc/

[18] - https://steemit.com/tauchain/@karov/tauchain-the-hanson-engine

[19] - https://steemit.com/tauchain/@karov/tauchain-as-szabo-booster

[20] - https://winklevosscapital.com/money-is-broken-but-its-future-is-not/

[21] - https://en.wikipedia.org/wiki/5D_optical_data_storage

[22] - https://en.wikipedia.org/wiki/Single-entry_bookkeeping_system

[23] - https://en.wikipedia.org/wiki/Double-entry_bookkeeping_system

[24] - https://bitcoinmagazine.com/articles/triple-entry-bookkeeping-bitcoin-1392069656/

[25] - https://en.wikipedia.org/wiki/Autotroph

[26] - https://en.wikipedia.org/wiki/Mutual_information

[27] - https://en.wikipedia.org/wiki/Sorites_paradox

[28] - https://en.wikipedia.org/wiki/Holon_(philosophy)

[29] - https://en.wikipedia.org/wiki/Mereology

[30] - https://medium.com/@cryptoeconomics/the-29-trillion-cost-of-trust-be8ffbd5788d

[31] - https://en.wikipedia.org/wiki/Ecumene

[32] - https://en.wikipedia.org/wiki/Midgard

[33] - https://steemit.com/tauchain/@karov/tauchain-trumps-procrustics

[34] - https://en.wikipedia.org/wiki/Proof-of-work_system

[35] - http://www.pnas.org/content/99/16/10237

[36] - http://www.truthcoin.info/blog/pow-cheapest/

[37] - https://www.scribd.com/document/354688866/Bitcoin-A-5-8-Million-Valuation-Crypto-Currency-and-A-New-Era-of-Human-Cooperation

[38] - http://www.truthcoin.info/blog/blockspace-demand/

[39] - https://steemit.com/blockchain/@karov/tau-through-the-moravec-prism

[40] - https://steemit.com/tauchain/@karov/masa-effect-with-tauchain

[41] - https://steemit.com/tauchain/@karov/tutor-ex-machina

[42] - https://steemit.com/tauchain/@karov/tauchain-trumps-procrustics

[43] - https://bitcoin.org/bitcoin.pdf

[44] - https://lightning.network/

[45] - https://steemit.com/tauchain/@karov/tauchain-in-the-algoverse

[46] - http://www.juliansimon.com/writings/Ultimate_Resource/ & https://orionsarm.com/fm_store/Population.pdf

[47] - https://en.wikipedia.org/wiki/Cybernetics & https://en.wikipedia.org/wiki/Control_theory

18qSKUUTAGw1uL53simrSiZ6pJpfxKACvj for research support. Thanks.

Copyright © 2018 Georgi Karov. All rights reserved.

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Good post and nice to see you shared all the content like money, bitcoin and cryptocurrency & altcoin and ICO etc..
In today's date, all should have knowledge about everything.

By yours,