Dynamics of Decentralized Security (Safety)
Continuing our discussion about blockchain community’s approach to the conflict between security and openness, now we come to people in group (c)[26], those who are willing to break away with the traditional, centralized notion of security, identity to embrace the new way of decentralized thinking – and that’s us, people who follow the Metis Way.
The traditional centralized system functions like an internal combustion engine⁶⁶ – individuals are like nuts and bolts of this giant engine and they must submit themselves to rules of the engine’s big cycle⁶⁷, so work can be done – but work depends on strong walls to hold the combustion chamber together where energy exchange takes place for work (hence the cycle). Centralized systems’ security is like the combustion chamber walls that are strong, rigid, coercive.
We, people of the Metis Way, renounce the ways of the centralized system – this means we should also part ways with that strong wall security model of the centralized system. We should venture away from the comfortable zones of the equilibrium into the nonequilibrium realms of self-assembly and life. The ecosystems of life do not fancy big dirty cycles of burning, exploding machines, but embrace small cycles of nonequilibrium behaviors, of which self-assembly and life are some exemplified phenomena. Such decentralized system dynamics resembles a dissipative system[13] that we mentioned in Part II of this discussion.
Both the small nonequilibrium cycle phenomena of inanimate self-assembly structure (such as in chemistry and fluid dynamics) and life need some seed condition or template to grow from – by this analogy our decentralized blockchain can design mechanisms around a seed pattern to generate diverse concern space for working decentralized mechanisms. As in nature the right combination of structure and condition that span the sustainable concern space and mechanisms depend on business trial and error and evolution. And such aforementioned seed pattern, condition or template, is called – yes, you guess it right – DAC.
In decentralized ecosystems, there is no place for a big, global, strong wall of security that hang above each individual participants. Instead, decentralized security is individualized – let’s borrow a common term and simply call it safety. Here in the decentralized land, security means the condition to sustain certain patterns of existence – e.g., self-assembly or life-forms – and
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⁶⁶ Internal Combustion Engine (ICE).
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(cont.)
nature always find a way for each of those patterns to work. Decentralized security is not absolute and noncoercive. They are probabilistic and can fail or collapse in a nondeterminate way – and that’s OK. Since decentralized security (safety) is individualized, each of its sporadic failure or collapse won’t bring down the whole ecosystem – that is just the way of nonequilibrium existence and life.
Understanding the dynamics of the decentralized systems could aid us in its mechanism design. Now we know the importance of finding the right condition for a seed with a cycle. The seed is a DAC, of course – a decentralized business template. With the approach inspired by the split-and-push methodology employed in layer 3 (business application layer) and tetralemma[27], we could build around each DAC a specific concern space – and in this concern space, mechanisms are solutions to form the condition for small dissipative cycles that can sustain themselves – manifestation of adaptive liveness[18] of the Metis Way.
Of course, the practical task of constructing the specific concern space and find the working cycle is left to those who start the DAC as a decentralized business. Business can succeed and fail. In the decentralized land, a business plan must be implemented as on-chain (layer 1 + layer 2 + layer 3) algorithmic mechanisms. How to increase the odds for success and decrease the odds for failure? First you must build your seed right – the DAC. DAC is a collection of parameters, attributes, and mechanisms – smart contracts – which defines a set of rules for economic incentives to work their magic.
With the attributes defined in DAC, you also need to set up the concern space – what are the concerns of your decentralized blockchain business? Only you, the founder, know. After setting up DAC, the seed, you need to find the cycle – and this part is the hardest. But don’t despair – we have theoretic and practical tools to help you with this part of the task as well. We already know that traditional mechanism design field was born out of game theory. But we can’t just toy with traditional economic game design practice post factum. Now in our DAC economy mechanism design challenge, we must up the ante – we need to tackle more complex games, e.g., evolutionary games. There are already interdisciplinary research across dynamics and algorithmic game theory – and it seems interesting mechanisms all involve some cycles – such as oscillators⁶⁸ and recurrence⁶⁹ behaviors. In a sense, a truly decentralized on-chain business has more similarity with the pharmaceutical industry than with the Internet industry where the winning formula is the product.
Now that we have concluded our deconstruction of centralized notion of security into a newly constructed notion of decentralized security – let’s apply a similar surgery to the other side of the blockchain mechanism design conflict – openness, permission and identity.
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⁶⁸ Non-Equilibrium Dynamics and Verifier's Dilemma.
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