Re: [Sks-devel] Requesting your thoughts on a web of trust scheme

[Robert J. Hansen]

On 12/11/2011 8:55 PM, Daniel F wrote:
> Please see my response above. I am sorry if the proposal as is
> didn't make it patently clear, but it was originally written for
> people with the right context, and I failed to realize that there is
> that significant omission from the POV of a third-party reader. As
> per above, this is about trade trust, and nothing else.

In that case, I think this proposal fails to take into account the major
problems with economic trust over the internet.

The principal one is the internet offers both ephemeral identities and
pseudonymous identities.  If I'm J. Random Person, I have an incentive
to become trusted to the point where someone trusts me with a big trade,
and then I have an incentive to betray that trust, walk away from my
ephemeral pseudonym, reap my windfall and start over again somewhere else.

There are a lot of ways people have tried to solve this.  You can try to
structure trades such that the benefit of future trades is always
greater than the benefit to be had from selling out on any one
particular trade: but that involves unrealistic models of economic
growth.  You can try to abolish ephemerality or pseudonymity, in which
case, the trust metric becomes quite straightforward and you really
don't need this system.  (I gave a large sum of money to a complete
stranger a few months ago in order to purchase a Mustang GT sports car.
 Didn't bother me in the slightest -- I knew who he was, I knew where he
worked, I knew how long his business had been in operation, and he knew
that if he screwed me over I'd sue him.  I could've paid for it in
BitCoins via an electronic transaction and told him to leave the car in
my apartment building's garage and the keys at my desk, and still been
perfectly confident the car would've arrived as ordered.  The existence
of enforceable contracts radically simplifies trust calculations.)

Anyway.  I hate to sound dismissive, but -- I think you're solving the
wrong problem and not paying enough attention to the eight hundred pound
gorilla in the room.

And with that, I think I'm done here.  It's not that the question isn't
interesting, but we're now entering the realm of game-theoretical
questions and that's unquestionably off-topic for this list.

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